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Economics111813
| Question | Answer |
|---|---|
| Law of Supply | Tendency of suppliers to offer more of a good at a higher price |
| Import restrictions cause prices to________ | Rise |
| If sellers expect the price of goods to increase dramatically in the near future ________________ | They will store the goods until the price goes up |
| Examples of goods with inelastic supply: | Apple orchards, orange groves, etc. (they have inelastic supply in the short term) |
| When the selling price of a good goes up ________________ | It becomes practical to produce more goods |
| The factor that has the greatest influence on elasticity and inelasticity of supply | Time |
| Examples of Fixed costs | Rent, property taxes, essential workers, etc. |
| Change in quantity supplied is movement along a given supply curve due to _________ | Price |
| If the supply of a good is inelastic ___________________________ | Producers will not change their quantity supplied by much if the market price goes up |
| Subsidy | A government payment that supports a business or market |
| Excise Tax | A tax on the production or sale of a good; it increases production costs by adding an extra cost for each unit sold and causes the supply of a good to decrease at all price levels and the supply curve shifts to the left |
| Regulation | Government intervention in a market that affects the production of a good |
| Formula to calculate the price elasticity of supply | % Change in Quantity Supplied/ % Change in Price |
| What is the difference between a supply schedule and a market supply schedule? | A supply schedule is a chart that lists how much of a good a supplier will offer at different prices. A market supply schedule is a chart that lists how much of a good all suppliers will offer at different prices |
| How is elasticity of supply related to elasticity of demand? | They both react to a change. Elasticity of supply reacts to a change in price while elasticity of demand reacts to a change in demand. |
| What causes supply to grow as price goes up? | Cost of production |
| Supply Schedule | A chart that lists how much of a good a supplier will offer at different prices |
| Supply Curve | A graph of the quantity supplied of a good at different prices |
| Elasticity of Supply | A measure of the way quantity supplied reacts to a change in price |
| Excise Tax | A tax on the production or sale of a good |
| Variable Cost | A cost that rises or falls depending on how much is produced |
| Increasing Marginal Returns | A level of production in which the marginal product of labor increases as the number of workers increases |
| Diminishing Marginal Returns | A level of production in which the marginal product of labor decreases as the number of workers increases |
| Marginal Revenue | The additional income from selling one more unit of a good; sometimes equal to price |
| Marginal Product of Labor | The change in output from hiring one additional unity of labor |
| Marginal Cost | The cost of producing one more unit of a good |
| Market Supply Schedule | A chart that lists how much of a good all suppliers will offer at different prices |
| Quantity Supplied | The amount a supplier is willing and able to supply at a certain price |
| Market Supply Curve | A graph of the quantity supplied of a good by all suppliers at different prices |
| Total Cost | Fixed costs plus variable costs |
| Variable | A factor that can change |
| Regulation | Government intervention in a market that affects the production of a good |
Created by:
AndreaPost