Unit 2 Check-in

When the price of something increases, the quantity demanded

• increases.

• decreases.

• remains unchanged.

• reverses.

Consider the term marginal utility. Which word is the best synonym for marginal?

• useful

• satisfactory

• borderline

• additional

Demand is the desire, (a)   , and willingness to buy a product or service.

What is the main cause of a change in quantity demanded?

• substitution

• changes in revenue

• change in price

• the income effect

Which of the following replaces a costly item with a less costly one?

• the substitution effect

• the income effect

• change in demand

• consumer taste

Which product most likely has a demand that is inelastic?

• a meal at a restaurant

• green beans

• a vital medicine

• a vacation

Quantity supplied increases when the price (a)   .

Which of these best describes the influence of high prices on the behavior of producers?

• They are an incentive for producers to produce more.

• They are an incentive for producers to buy less.

• They encourage producers to modify their supply schedules.

• They have no significant overall effect on producer behavior.

Which of these names the way in which producers regard taxes?

• as an investment in technology

• as part of the cost of production

• as an entry in their supply schedule

• as an encouragement to productivity

Which of these is true of both an individual supply curve and a market supply curve?

• A change in quantity supplied takes place when a change in demand occurs.

• A change in quantity supplied takes place only when there is a change in price.

• A change in quantity supplied takes place only when the price remains constant.

• A change in quantity supplied takes place when a change in demand is projected.