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Cards In This Set
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Explain the Law of Demand.
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When the price of a product falls, the quantity demanded of the product will increase.
When the price of a product increases, the quantity demanded of the product with decrease.
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Name the variables that shift market demand.
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Income, Price of Related Goods, Tastes, Population and demographics, and Expected Future Prices.
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What will happen to the demand for a normal good/inferior good when income rises?
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Normal Good: Demand with increase.
Inferior Good: Demand will decrease.
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An increase in income (and the good is normal) shifts the demand curve to the...
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Right.
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In increase in income (and the good is inferior) shifts the demand curve to the...
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Left.
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In increase in the price of a substitue good shifts the demand curve to the...
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Right.
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An increase in the price of a completentary good shifts the demand curve to the...
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Left.
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In increase in teh taste for the good shifts the demand curve to the...
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Right.
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An increase in population shifts the demand curve to the...
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Right.
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An increase in the expected price of the good in the future shifts the demand curve to the...
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Right.
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Explain the Law of Supply.
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An increase in price causes the quantity supplied to increase.
A decrease in price causes the quantity supplied to decrease.
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What variables shift market supply?
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Prices of inputs, Technological change, Prices of substitutes in production, Number of firms in the market, and Expected future prices.
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In increase in the price of an input will shift the supply curve to the...
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Left.
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In increase in productivity will shift the supply curve to the...
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Right.
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An increase in the price of a substitute in production will shift the supply curve to the...
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Left.
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