At a price for which quantity demanded exceeds quantity supplied, a __________ is experienced, which pushes the price __________ toward its equilibrium value
A) surplus; downward
B) surplus; upward
C) shortage; downward
D) shortage; upward
D
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Joe's income is $500, the price of food (F) is $2 per unit, and the price of shelter (S) is $100. Which of the following represents his budget constraint?
A) 500 = 2F + 100S B) F = 250 - 50S C) S = 5 - .02F D) All of the above
When a production possibilities frontier is bowed outward, the opportunity cost of producing an additional unit of a good
a. increases as more of the good is produced. b. decreases as more of the good is produced. c. does not change as more of the good is produced. d. may increase, decrease, or not change as more of the good is produced.
When the relative price of a good increases, consumers respond by buying
a. a larger quantity of that good and a larger quantity of substitutes for that good. b. a larger quantity of that good and a smaller quantity of substitutes for that good. c. a smaller quantity of that good and a larger quantity of substitutes for that good. d. a smaller quantity of that good and a smaller quantity of substitutes for that good.
Good X is a normal good. If the average income of those who buy good X rises, the _____________ curve for good X will shift ____________ resulting in a(n) _____________ in the equilibrium price of X and a(n) ____________ in the equilibrium quantity of X
A) supply; rightward; decrease; increase. B) demand; leftward; decrease; decrease C) demand; rightward; increase; increase D) supply; leftward; increase; decrease E) supply; leftward; increase; increase