Econ: Chapter 5 Demand & Supply Review

The law of demand states that as quantity demanded decreases

• wages decrease.
• production increases.
• price increases.
• quality decreases.

In the summer picnic season, a sharp rise in the price of burgers may lead to an increase in demand for

• buns.
• relish.
• chicken.
• coleslaw.

Quantity demanded moves along the demand curve in response to changes in

• price.
• income.
• preferences.
• expectations.

Which of these is most likely to happen to demand for clothes in a clothing store when blizzards keep customers at home?

• The demand curve shifts to the left.
• The demand curve becomes flatter.
• The demand curve shifts to the right.
• The demand curve becomes steeper.

Supply depends on the willingness and ability of

• donors to contribute.
• producers to produce.
• advertisers to promote.
• consumers to purchase.

According to the law of supply, what happens as price increases?

• The quantity supplied increases.
• The quantity supplied decreases.
• The supply curve shifts to the left.
• The supply curve shifts to the right.

Which of these would most likely increase the supply of soccer balls?

• a transportation strike
• a government excise tax
• a decrease in the price of raw materials
• an increase in the supply of tennis balls

The degree to which the quantity demanded responds to changes in price is called

• elasticity.
• revenue.
• schedule.
• utility.

Which of these is most likely to quickly become available in larger quantities as a result of a price increase?

• airline service
• babysitters
• medical doctors
• midsize cars

Which of these is the best example of diminishing marginal utility?

• A shortage of bike paths makes bicycles less useful.
• Bicycles become less useful as they get old and start to rust.
• Someone who has one bicycle will have less use for another.
• People with cars have less use for bicycles than people without cars have.