Save
Upgrade to remove ads
Busy. Please wait.
Log in with Clever
or
show password
Forgot Password?
Don't have an account?  Sign up 
Sign up using Clever
or
Username is available taken
show password


Make sure to remember your password. If you forget it there is no way for StudyStack to send you a reset link. You would need to create a new account. Your email address is only used to allow you to reset your password. See our Privacy Policy and Terms of Service.

Already a StudyStack user? Log In

Reset Password
Enter the associated with your account, and we'll email you a link to reset your password.
focusNode
Didn't know it?
click below
 
Knew it?
click below
Don't Know
Remaining cards (0)
Know
0:00
edit
Embed Code - If you would like this activity on your web page, copy the script below and paste it into your web page.

  Normal Size     Small Size show me how

Economics Review 4

QuestionAnswer
What is meant by the term market equilibrium? Market equilibrium occurs when demand equals supply.
Define the term market clearing price. The market clearing price is the price at which sellers are clearing (selling) their stock at an acceptable rate.
True or False? The equilibrium price is where sellers and buyers are satisfied. True. At the equilibrium price, sellers will be satisfied with the rate and quantity of sales, and buyers will be satisfied that the product provides benefits worth paying for.
How is market disequilibrium defined? Market disequilibrium occurs whenever there is excess demand or excess supply in a market.
What does the term excess demand mean? Excess demand occurs when the demand is greater than the supply.
Define the term excess supply. Excess supply occurs when the supply is greater than the demand.
What can cause excess demand? Excess demand occurs when product prices are too low or when demand is so high that supply cannot keep up with it.
What causes excess supply? Excess supply occurs when product prices are too high or when demand falls unexpectedly.
State the meaning of the term shortage. A shortage occurs when there is excess demand in the market (Qd > Qs).
True or False? Shortages arise when the price is above equilibrium. False. Shortages arise when the selling price is below equilibrium, whereas surpluses arise when the selling price is above equilibrium.
Define the term surplus. Surplus is the term used when there is excess supply in the market (Qs > Qd).
What do demand and supply schedules show? Demand and supply schedules show the quantity demanded and the quantity supplied of a product at different price levels.
What are dynamic markets? Dynamic markets are real world markets that are constantly changing.
Define the term disequilibrium. Disequilibrium occurs when there is excess demand or excess supply in a market.
How do market forces respond to disequilibrium? Market forces seek to clear excess demand or supply.
What causes an increase in demand? An increase in demand is caused by a change in the conditions of demand.
State the meaning of the term supply shock. A supply shock is an unexpected event that changes the supply of a good or service, such as the 2011 tsunami in Japan, which created a global supply shock.
What is the impact of inflation on demand? Inflation lowers real income, reducing the demand for normal goods and services.
What is the aim of a subsidy? A subsidy is a payment from the government to the producer with the aim of increasing the supply of a good or service.
True or False? An increase in supply lowers the equilibrium price. True. An increase in supply lowers the equilibrium price.
How do markets respond to excess demand? Sellers usually raise prices in response to excess demand.
What is the market's response to excess supply? Excess supply usually causes sellers to lower prices.
Created by: BethC
 

 



Voices

Use these flashcards to help memorize information. Look at the large card and try to recall what is on the other side. Then click the card to flip it. If you knew the answer, click the green Know box. Otherwise, click the red Don't know box.

When you've placed seven or more cards in the Don't know box, click "retry" to try those cards again.

If you've accidentally put the card in the wrong box, just click on the card to take it out of the box.

You can also use your keyboard to move the cards as follows:

If you are logged in to your account, this website will remember which cards you know and don't know so that they are in the same box the next time you log in.

When you need a break, try one of the other activities listed below the flashcards like Matching, Snowman, or Hungry Bug. Although it may feel like you're playing a game, your brain is still making more connections with the information to help you out.

To see how well you know the information, try the Quiz or Test activity.

Pass complete!
"Know" box contains:
Time elapsed:
Retries:
restart all cards