Economics Chapter 5

When government actions cause the supply of a good to increase, what happens to the supply curve for that good?

• The supply curve is unaffected.

• It reverses direction.

• It shifts to the right.

• It shifts to the left.

What affect does a rise in the cost of raw materials have on the cost of a good?

• A rise in the cost of raw materials lowers the overall cost of production.

• The good becomes cheaper to produce.

• The good becomes more expensive to produce.

• This does not have any affect on the eventual price of a good.

The supply of imported goods and services has an impact on the supply of the same goods and services here.

Government import restrictions will cause a decrease in the supply of restricted goods.

• The Global Economy

• Future Expectations of Prices

• Number of Suppliers

• None of these

Expectations of higher prices will reduce supply now and increase supply later. Expectations of lower prices will have the opposite effect.

• Future Expectations of Prices

• Number of Suppliers

• The Global Economy

• None of these

If more firms enter a market, the market supply of the good will rise. If firms leave the market, supply will decrease.

• Future Expectations of Prices

• Number of suppliers

• The Global Economy

• None of these

is a government payment that supports a business or market.

• Subsidy

• Evacuation

• Retaliation

• Habeas Corpus

is a tax on the production or sale of a good.

• Wasabi Tax

• Excise Tax

• Increasingly difficult tax

• Progressionistic tax

occurs when the government steps into a market to affect the price, quantity, or quality of a good.

• Retaliation

• Responsiblility

• Regulation

• Reputation

Any _______________ in the cost of an input such as the raw materials, machinery, or labor used to produce a good, will affect supply.

• retaliation

• reputation

• change

• rhetorical

As input costs ___________________, the firm’s marginal costs also increase, decreasing profitability and supply.

• decrease

• stay stationary

• increase

• None of these