Economics Unit 3 Supply and Demand

According to the rules of Supply, which of these would happen if the price of an item was raised

• Producers would want to make less of the item

• More of the item would be produced

• The producers would increase the price of that item even more

• Producers would lower the price on similar items.

In a perfect competition, what sets the equilibrium price in the market?

• nonprice competition

• Products supply and demand

• The US Government

• a monopoly

What is one possible effect of restrictions prices on imports?

• prices drop

• prices rise

• prices to rise steeply and then drop.

• They usually do not have any lasting effect on price.

If the demand for a normal good (for example, steak) shifts to the left, what would be the reason for this shift?

• Consumers have less income to spend

• There has been a reduction in the number of cattle

• the price of steak has risen.

• the price of cattle feed has gone up.

On a demand curve, movement along the curve, as opposed to a shift in the entire curve, is a result of ___

• price change

• demand increase

• decrease in dmeand

• change in demand

The relationship between income and a normal good demand is?

• If your income increases your demand will go up as well

• An increase in price increases income.

• If your income increases your demand will go down.

• A decrease in income increases demand.

Why would a demand curve be downward sloping?

• because quantity demanded increases as price decreases

• because of the natural elasticity of the market

• because it shows how increasing incentives changes demand

What will happen if the price is increased for a product that is a substitute for another product?

• Increased demand for the replacement good

• nothing

• no effect on the other good

• Decrease the demand for the other good.

What do prices do for buyers and sellers?

• help them make decisions

• help them buy products

• help model new products

• help with market sales targets in a four year span

What will happen if there is a decrease in the price of cameras

• cause the demand curve for film to become vertical.

• shift the demand curve for film to the right.

• shift the demand curve for film to the left.

• not affect the demand for film.