Workers at a bicycle assembly plant currently earn the mandatory minimum wage. If the federal government increases the minimum wage by $1/hr, then it is likely that

supply of bicycles will shift to the left.

Assume the market for port is perfectly competitive. When one port buyer exits the market,

the price of pork does not change.

Soup is an inferior good if the demand

for soup falls when income rises.

What would happen to the equilibrium price and qty of lattes if coffee shops began using a machine that reduced the amt of labor necessary to produce steamed milk, which is used to make lattes, and scientists discovered that lattes cause heart attacks.

The equilibrium price would decrease, and the effect on equilibrium qty would be ambiguous.`

Suppose roses are currently selling for $20/dzn, but the equilibrium price of roses is $30/dzn. We would expect

shortage to exist and the market price of roses to increase.

Equilibrium qty must increase when demand

increase and supply does not change, when demand does not change and supply increase and when both demand and supply increase.

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ECON2302 - KC - Ch04

Ecomomics Chapter 4 review

Question	Answer
Workers at a bicycle assembly plant currently earn the mandatory minimum wage. If the federal government increases the minimum wage by $1/hr, then it is likely that	supply of bicycles will shift to the left.
Assume the market for port is perfectly competitive. When one port buyer exits the market,	the price of pork does not change.
Soup is an inferior good if the demand	for soup falls when income rises.
What would happen to the equilibrium price and qty of lattes if coffee shops began using a machine that reduced the amt of labor necessary to produce steamed milk, which is used to make lattes, and scientists discovered that lattes cause heart attacks.	The equilibrium price would decrease, and the effect on equilibrium qty would be ambiguous.`
A decrease in demand will cause a decrease in price, which will cause a decrease in supply. True or false?	FALSE
Sellers respond to surplus by cutting their prices. True or false?	TRUE
Price cannot fall so low that some sellers choose to supply a qty of zero. True or false?	FALSE
Which of the following is a determinant of the market supply curve but NOT a determinant of an individual's seller's supply?	the number of sellers.
The quantity supplied of a good or service is the amount that sellers are willing and able to sell at a particular price. True or false?	TRUE
Suppose roses are currently selling for $20/dzn, but the equilibrium price of roses is $30/dzn. We would expect	shortage to exist and the market price of roses to increase.
Equilibrium qty must increase when demand	increase and supply does not change, when demand does not change and supply increase and when both demand and supply increase.
The law of demand is true for most goods in the economy. True or false?	TRUE
The law of supply states that, other things equal, when the price of a good falls, the qty supplied of the good rises. True or false?	FALSE
When the price of a good is low, selling the good is profitable, and so the qty supplies is large. True or false?	FALSE
In a competitive market, each seller has limited control over the price of his product because buyers exert more control over the price than do sellers. True or false? True or false?	FALSE

Created by: debra473

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