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Competitive Markets: Supply

Authored by Alexis Partee

Social Studies, Other

11th - 12th Grade

Used 4+ times

Competitive Markets: Supply
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14 questions

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1.

MULTIPLE CHOICE QUESTION

1 min • 1 pt

A fall in the price of corn, ceteris paribus, is likely to lead to _______________ the supply curve

for corn.

a leftward shift in

a rightward shift in

a downward movement along

an upward movement along

Answer explanation

Media Image

A fall in price will only cause movement along a supply curve, rather than a shift. Since the price fell, quantity supplied will decrease as well.

2.

MULTIPLE CHOICE QUESTION

1 min • 1 pt

Which of the following is likely to increase the supply of strawberries?

an increase in the demand for strawberries

an increase in the price of pesticides

a fall in the price of blueberries, a competitive good in production

an increase in the price of strawberries

Answer explanation

Media Image

Blueberries in this case would be an example of competitive supply.

3.

MULTIPLE CHOICE QUESTION

1 min • 1 pt

A fall in input prices or costs of production, ceteris paribus, leads to

an increase in supply

a decrease in supply

an increase in demand

a decrease in demand

Answer explanation

If inputs, or factors of production, are less expensive, then a firm can increase their production at a lower cost.

4.

MULTIPLE CHOICE QUESTION

1 min • 1 pt

An increase in the quantity of corn supplied, shown by _______________ can result from ______________________.

a downward movement along the supply curve / an improvement in the technology of producing corn

an upward movement along the supply curve / an increase in the price of corn

a rightward shift of the corn supply curve / lower input prices

a leftward shift of the corn supply curve / higher input prices

Answer explanation

Since this question is asking about "quantity supplied," then it has to be caused by a change in price. Since quantity increased, the law of supply states that the price probably increased as well.

5.

MULTIPLE CHOICE QUESTION

1 min • 1 pt

You observe that the quantity of a good supplied by producers falls as the price of the good increases. You conclude that

this is a violation of the law of supply

this is likely due to an increase in supply

this is likely due to a decrease in demand

this is likely due to a decrease in supply

Answer explanation

If quantity supplied has fallen but prices have risen, that's a good indication that the supply curve has probably shifted to the left.

6.

MULTIPLE CHOICE QUESTION

1 min • 1 pt

The short run is the period of time when _____________________ whereas the long run is the period of time when _____________________.

all factors of production are fixed / all factors of production are variable

at least one factor of production is fixed / at least one factor of production is variable

at least one factor of production is fixed / all factors of production are variable

all factors of production are fixed / at least one factor of production is variable

Answer explanation

Land and capital are usually the fixed inputs in the short-run. Everything is variable in the long-run

7.

MULTIPLE CHOICE QUESTION

1 min • 1 pt

The marginal product of labour refers to

output produced by one worker on average

extra cost of hiring one more worker

extra output produced by one more worker

extra revenue gained from hiring one more worker

Answer explanation

"Marginal" in economics means "one more." In this case, we want to know how much more of a product (or output) do we get from hiring one more person.

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