1.5 & 1.6 - Supply and Market Equilibrium

Front

If the wage rate of workers producing a good decreases, what is likely to happen?

Back

The supply of the good will increase.

Front

Which of the following describes the law of supply?

Back

An increase in price will increase quantity supplied.

Front

What happens in a competitive market when the price of a good is below the equilibrium price?

Back

Price will increase to eliminate the shortage and restore equilibrium.

Front

Which changes in supply and demand will definitely decrease both the equilibrium price and quantity of a good?

Back

Supply - No change Demand - Decrease

Front

To protect domestic producers, a country imposes a tariff on imported commodity Y. What is most likely to happen in the short run? I. A decrease in domestic production of Y II. An increase in domestic production of Y III. An increase in foreign output of Y

Back

II. An increase in domestic production of Y

Front

The table shows the quantity demanded and supplied for wheat at various prices. What is the equilibrium price and quantity for wheat?

Back

Price - $1.50 Bushels of Wheat - 20,000

Front

The graph shows the demand and supply of a good. If the market price is P1, then

Back

there is a surplus, and the price will fall

Front

At a price of P2, what will happen in the market?

Back

There will be a surplus of 60 units and 30 units will be exchanged.

Front

Assume the market for bottled water is in equilibrium. If both supply and demand decrease, what will happen to equilibrium price and quantity?

Back

Price - Indeterminate Quantity​ - Decrease

Front

At price P0, which of the following is true?

Back

Shortage will push prices up to equilibrium at 60 units.