Micro and Macroeconomics

All of the following are sections of the circular flow diagram but....

• Product market

• factor market

• Firms

• Flea Market

The outer circle in the circular flow diagram is the flow of....

• goods, services, and productive resources

• money

• aggregate supply and demand

• price and quantity

The law of Demand states.....

• that the higher the price, the more producers will make

• the lower the price, the less producers will make

• the higher the price, the more consumers will buy

• the lower the price, the more consumers will buy

The law of supply states

• the higher the price, the less producers will make

• the higher the price, the more producers will make

• the lower the price, the more consumers will buy

• the higher the price, the more consumers will buy

In the circular flow diagram, which sections buys goods and services from the product market and provides productive resources to the factor market.....

• Households

• Firms

• Corporations

• Limited Liability Partnership

In the circular flow diagram, which section is where business purchase productive resources needed to make products?

• Product market

• factor market

• households

• firms

Which of the following might cause supply to increase on a Micro graph?

• Government subsidizing tomato production

• firms providing electricity and power going out of business

• An increase in government taxation on textbook producers

• A natural disaster destroying farmers ability to harvest their crops

When quantity supplied and demanded are equal you have...

• a surplus

• a shortage

• a deficit

• equilibrium

On a micro graph, which of the following might cause demand to increase?

• A decrease in the price of a complementary good

• increase in sales and income taxes on consumers

• a decline in the popularity of a product

• A random increase in the price of the product

On a micro graph, which of the following might cause demand to decrease?

• A rise in the popularity of a product

• increase in the disposable income of consumers

• A substitute good is available at a cheaper price

• A complementary good is now available at a cheaper rate