Microeconomic Concepts: Supply and Demand

Which statement best defines demand in microeconomics?

• Amount consumers will buy at various prices

• Amount producers will sell at one market price

• Quantity bought only when price equals zero

• Desire to buy regardless of the price level

A fall in the price of the good being studied causes which effect on demand?

• No change in quantity demanded

• Leftward shift of the demand curve

• Rightward shift of the demand curve

• Movement down along the demand curve

Which is a shifter of demand, not a movement along the curve?

• Consumer tastes change suddenly

• Temporary price spike today

• Price of the good decreases

• Sale discount for this product

Which event would most likely decrease demand for a product?

• Lower price of a close substitute

• Higher consumer incomes overall

• More consumers enter the market

• Lower price of a complement

What distinguishes a change in supply from a change in quantity supplied?

• Shift of the curve versus movement along

• Both are shifts from one curve to another

• Both are movements along the same curve

• Movement along versus shift of the curve

An increase in the market price of a good, holding other factors constant, causes which effect on supply?

• Leftward shift of the supply curve

• Rightward shift of the supply curve

• Movement up along the supply curve

• No change in quantity supplied

Which is a shifter that can increase supply for many firms?

• Improved production technology

• Fewer sellers in the market

• Higher output taxes imposed

• Rising input resource costs

Which factor is listed as a shifter of demand rather than supply?

• Subsidies granted to producers

• Cost of resources used in production

• Number of consumers in the market

• Number of sellers in the market

Which scenario best illustrates a change in quantity demanded rather than a change in demand?

• A popular ad campaign boosts desire for sneakers

• Consumers expect higher future prices and buy now

• Rising incomes increase purchases of restaurant meals

• Gasoline price drops and more is bought today

Which term describes the nature and degree of competition among firms in the same industry?

• Total product

• Economic model

• Market structure

• Price fixing