Supply and Demand

Front

As prices rise, sellers will offer more goods and services for sale.

Back

Law of Supply

Front

The change in consumption resulting from a change in income

Back

Income effect

Front

Why is the Supply Curve upward-sloping?

Back

As price increases, suppliers can earn higher profits or justify higher marginal costs to produce more.

Front

What should a producer do when there is a shortage of a good?

Back

Raise the prices of that good.

Front

What happens when a price ceiling is imposed above the equilibrium price?

Back

The equilibrium outcome prevails.

Front

Which of the following will not cause the demand for product K to change? Options:
A change in the price of close-substitute product J
,
An increase in consumer incomes
,
A change in the price of K
, A change in consumer tastes

Back

A change in the price of K

Front

If the demand curve shifts to the right, then the supply curve move up and to the right.

Back

True

Front

An increase in price of jelly causes a decrease in demand of peanut butter. The products are

Back

complements

Front

An effective ceiling price will:

Back

clear the market.

Front

Why does an increase in the price of a product reduce the amount purchased?

Back

Consumers will substitute other products for the one whose price has risen.