Exam 3: Demand and Supply

The principle stating that, for virtually all goods and services, there is a negative relationship between price and quantity demanded, all other things unchanged, is the law of:

Which of the following will result in an increased price of milk?

Use the following to answer questions . Exhibit: Demand and Supply of Wheat -(Exhibit: Demand and Supply of Wheat) What are the equilibrium price and quantity in this wheat market?

A decrease in the price of a good will result in a decrease in supply.

A surplus is a result of equilibrium price being below the current price.

Use the following to answer questions Exhibit: The Demand for Chocolate-Covered Peanuts Quantity Demanded (bags per month) -(Exhibit: The Demand for Chocolate-Covered Peanuts) If George is only able to purchase 30 bags of chocolate-covered peanuts, the maximum price he is willing and able to pay for each bag is ________ cents.

Given that meat and potatoes are complementary goods, if the price of meat decreases substantially, there would be:

Which of the following most correctly states the law of demand?

A decrease in the price of eggs, all other things unchanged, will result in a(n):

Use the following to answer questions . Exhibit: Demand and Supply of Gasoline -(Exhibit: Demand and Supply of Gasoline) The initial price and quantity (at intersection of S₁ and D) in equilibrium are:

If the price of a commodity increases, all other things unchanged, you would expect the:

Use the following to answer questions . Exhibit: Demand Shifters and Supply Shifters -(Exhibit: Demand Shifters and Supply Shifters) The exhibit shows how supply and demand might shift in response to specific events. Suppose a wet and sunny year increases the nation's corn crop by 20 percent. Which panel best describes how this will affect the market for corn?

Differentiate between a change in demand and a change in quantity demanded.

Plastic and steel are substitutes in the production of automobiles. If steel prices go up, all other things unchanged:

Use the following to answer questions . Exhibit: Simultaneous Shifts in Demand and Supply -(Exhibit: Simultaneous Shifts in Demand and Supply) D₁ and S₁ are original supply and demand curves, and S₂ and D₂ are new curves. In this market for a normal good, the shift in the demand curve may have been a result of:

Use the following to answer questions . Exhibit: Demand and Supply-Determinants -(Exhibit: Demand and Supply-Determinants) The exhibit shows how supply and demand might shift in response to specific events. Suppose consumer incomes decrease. Which panel best describes how this will affect the market for used clothing, an inferior good?

Use the following to answer questions Exhibit: The Demand for Chocolate-Covered Peanuts Quantity Demanded (bags per month) -(Exhibit: The Demand for Chocolate-Covered Peanuts) If the price of chocolate-covered peanuts increases from 40 cents to 50 cents, Dan will reduce his quantity demanded from 160 bags to 140 bags due to:

If the quantity supplied in a market exceeds the quantity demanded in a market, we would expect price to:

In the Case in Point on "The Monks of St. Benedict's," the Monks got out of the egg business largely because:

The law of demand implies that: