Market Equilibrium, Disequilibrium, and Changes in Equilibrium

A “change in quantity demanded” is a shift of the entire demand curve to the right or to the left.

• True
• False

“In the corn market, demand often exceeds supply, and supply sometimes exceeds demand.” “The price of corn rises and falls in response to changes in supply and demand.” In which of these two statements are the terms “supply” and “demand” used correctly?

Suppose that in the market for computer memory chips, the equilibrium price is $50 per chip. If the current price is $55 per chip, then there will be a(an) ______________ of memory chips.

• shortage
• surplus
• equilibrium quantity
• a future increase in the production
• none of the above

On a hot day, both the demand for lemonade and the supply of lemonade increase.

• Price Up
• Quantity Up
• Price Down
• Quantity Down

A price ceiling will result in a shortage only if the ceiling price is ____________ the equilibrium price.

• Less than
• greater than
• equal to

The law of demand is illustrated by a demand curve that is

• vertical
• horizontal
• Upward sloping
• downward sloping

Which would cause a decrease in the quantity of computers supplied?

• An increase in the demand of computers.
• A decrease in the demand of computers.
• An increase in the incomes of consumers.
• A decrease in the price of parts for making computers.

The price of oil declines significantly, the price of gasoline also declines. The latter occurs because of a(n):

• increase in the demand for gasoline
• decrease in the demand for gasoline
• increase in the supply of gasoline
• decrease in the supply of gasoline.

A schedule which shows the various amounts of a product producers are willing and able to produce at each price in a series of possible prices during a specified period of time is called:

• Quantity supplied
• Quantity demanded
• Supply
• Demand

If the quantity supplied of a product is less than the quantity demanded, then:

• There is a shortage of the product
• There is a surplus of the product
• The product is a normal good
• The product is an inferior good