Exam 4: Extensions of Demand and Supply Analysis

Suppose the price of crude oil used to produce gasoline rises significantly.At the same time,consumers purchase hybrid cars in great numbers.In the market for gasoline,demand shifts to the ________ and supply shifts to the ________.

A price floor that is set above market equilibrium will cause

If the government imposes a price floor that is higher than the market clearing price,then

When rent controls establish a legal maximum rental rate below the equilibrium rental rate,

A newspaper headline asserts: "Rising Demand Pushes Up Housing Prices." This headline

In a market,the rationing function of prices results in

A price ceiling is

In which of the following situations will both market clearing price and the equilibrium quantity decrease?

A black market is a market in which

Which of the following is most likely to generate a surplus?

When the government sets a price floor which is above the equilibrium price,

If demand increases while supply decreases,then the equilibrium price

Price controls often generate

If both buyers and sellers expect the price of a commodity to rise in the future,it is likely that the market clearing price ________ and the equilibrium quantity ________.

-Refer to the above figure.A price control has been set which has led to a shortage.This means that a

An import quota is a limit on the

In a market system,intermediaries in the exchange process are known as

The market system is also called the price system because

Suppose you observe that the price of a good increases and that the quantity of this good sold also increases.If only the demand curve or the supply curve shifts this suggests that

Assume that CDs are a normal good and that the price of stereo equipment falls while the labor costs of producing CDs increase.What will happen in the market for CDs?