Ch 3 Individual Markets: Demand And Supply

10 Questions  I  By Ecofanics on September 7, 2009
Review for ch 3 McConnell and Brue 15 ed.

  

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1.  The law of demand states that as price increases, other thing being equal, the quantity of the product demanded increases.
A.
B.
2.  If price falls, there will be an increase in demand.
A.
B.
3.  If the demand for a product increases and the supply of the product decreases, the equilibrium price will increase and the equilibrium quantity will be indeterminant.
A.
B.
4.  A surplus indicates that the quantity demanded is less that the quantity supplied.
A.
B.
5.  If the supply of a product increases and the demand decreases, the equilibrium price and quantity will increase.
A.
B.
6.  If the market price of a product is below its equilibrium price, the market price will will tend to rise because demand will decrease and supply will increase.
A.
B.
7.  If two goods are complementary, an increase in the price of one will tend to increase the demand  for the other.
A.
B.
8.  Supply is a schedule that shows the amounts of a product a producer can make in a limited amount of time.
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B.
9.  If consumer tastes or preferences for a product decrease, the demand for the product will tend to decrease.
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B.
10.  Economists often make the assumption of other things equal to hold constant the effects of other factors when examining the relationship between prices and quantities demanded and supplied.
A.
B.
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