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ShentonEconsTest2
Study4EconsTest2
| Question | Answer |
|---|---|
| What is the Law of Demand? | As price of a Good rises, the quantity demanded will fall. |
| Changes to Equillibriums:What happens in "Increase in Demands"? | D-curve shifts to right, Increase in Price, Expansion of Quantity |
| Changes to Equillibriums: What happens in "Decrease in Demand"? | D-curve shifts to left, Decrease in Price, Quantity Expands |
| Changes to Equillibriums: What happens in "Increase in Supply"? | S-curve shifts to right, E.Price decrease,E.Q expands |
| Changes to Equillibriums: What happens in "Decrease in Supply"? | S-curve shifts to left, E.Price increase, E.Q contracts |
| What are the 'Changes to Equillibriums'? | -increase in demand, -decrease in demand, -increase in supply, -decrease in supply |
| Demand and Supply: What happens when inventories fall and consumption rises? | Price increases causing Q to contract + O to expand -> Pe |
| What are inventories? | Any unsold stock, also unemployment. |
| Demand and Supply: What happens when inventories rise and consumption falls? | P fall causing Q to expand + O to contract -> Pe |
| At P, S<D | Shortage |
| At P, S>D | Surplus |
| What are the characteristics of a competitive market? | Price determined by interaction between buyers and sellers |
| What is a Product Market? | consumer is demand and firm is the supplier |
| What is a Factor Market? | Households sell resources (in factors of production) to firms |
| What are the characteristics of a Non-Competitive Market? | A monopoly, dominant firm rules |
| In Supply: As P rises, Producers _____? | increase output |
| In Supply: As P rises, Demand ____? | contracts |
| In Supply: As Output rises and consumers buy less, Product is _____? | Less scarce |
| In Supply: As P falls, Consumer buy more-> product becomes ______ and price______? | Scarcer and Price increases |
| What is Demand? | Buying intentions of consumers that are willing and able to purchase |
| What is the Income Effect? | As real Y falls you demand less of a good |
| What is the Substitution Effect? | As price increases for Good A, demand will fall and demand for Good B increases |
| What is the Law of Diminishing Marginal Utility? | Satisfaction received from the consumption of increasing quantities of goods and services will eventually fall |
| Demand: P increases = Quantity falling | Contraction |
| Demand: P decreases = Quantity rising | Expansion |
| What is Price at E? | Market/Equillibrium Price |
| D=S | Equillibrium |
| What are the Non-Price Factors? (Shifting Entire Curve) | - Y of consumers- Related goods prices- Tastes and Preferences- Expectations of Consumers- Demographic Factors |
| What is Price at E? | Market/Equillibrium Price |
| D=S | Equillibrium |
| What are the Non-Price Factors? (Shifting Entire Curve) | - Y of consumers- Related goods prices- Tastes and Preferences- Expectations of Consumers- Demographic Factors |
Created by:
Chrissy3421
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