Econ Chapter 4 Review

What two factors are necessary for demand?

• desire for a good or service and its availability in the market

• desire for a good or service and the ability to pay for it

• the availability of a good or service and the ability to pay for it

• familiarity with a good or service and the desire to pay for it

An actress sets off a craze for wearing camouflage clothing among her fans. What factor is affecting demand?

• consumer expectations

• consumer taste

• complements

• substitutes

What is a market demand curve?

• a table showing how much of a product an individual is willing and able to buy

• a table showing how much of a product a market is willing and able to buy

• a graph showing how much of a product an individual is willing and able to buy

• a graph showing how much of a product a market is willing and able to buy

How is total revenue calculated?

• multiplying price by change in demand

• multiplying price by quantity sold

• multiplying change in price by change in quantity demanded

• multiplying change in price by quantity sold

What do business owners use to gather information for market demand schedules?

• income effect

• marginal utility

• market research

• substitution effect

Which of the following describes a demand curve?

• it is a horizontal line

• it slopes downward from left to right

• it slopes downward from right to left.

• it is bow-shaped

Which economic concept is defined as the measure of how responsive consumers are to price change?

• consumer expectation

• Consumer Taste

• decreasing marginal utility

• elasticity of demand

What term is defined as the change in the amount consumers will buy because they can buy a different product instead?

• inferior goods

• normal goods

• income effect

• substitution effect

What explains the shape of a demand curve?

• the law of diminishing marginal utility

• the formula to calculate total revenue

• the substitution effect

• the income effect

What term is defined as goods that consumers demand more of when their incomes rise?

• inferior goods

• normal goods

• complementary goods

• substitute goods