Exam 3: B: Demand, Supply, and Market Equilibrium

If two goods are complements (in consumption), a decline in the price of one will cause an increase in the demand for the other.

If an effective ceiling price is placed on gasoline then:

Which of the above diagrams illustrate(s) the effect of a decrease in consumer incomes upon the market for second-hand clothing? (Second-hand clothing is considered to be an inferior good)

When the price of a product falls, the purchasing power of our money income rises and thus permits us to purchase more of the product.This statement describes:

With allocative efficiency:

A price floor in a competitive market will result in persistent shortages of a product.

Which will not cause a shift in the demand for product A?

You are asked to determine, other things equal, the effects of a given change in a determinant of demand or supply for product Xupon (1) the demand (D) for, or supply (S) of, X, (2) the equilibrium price (P) of X and (3) the equilibrium quantity (Q) of X.Refer to the above.An improvement in the technology used to produce X will:

Which of the following combinations of changes in supply and demand (listed in the same order) is likely to cause an indeterminate change in quantity?

Other things equal, which of the following might shift the demand curve for gasoline to the left?

Graphically, the horizontal sum of all individual demand curves is known as:

The development of a new production technique that lowers the cost of producing product X will shift the supply curve of product X to the right.

Refer to the above data.If the price in this market was $14:

A surplus of any given commodity can be expected whenever the:

In the corn market, demand often exceeds supply and supply sometimes exceeds demand"."The price of corn rises and falls in response to changes in supply and demand.In which of these two statements are the terms "demand" and "supply" being used correct

Shortages and surpluses can occur in markets other than those in which government imposes the price floors and ceilings.This phenomenon could be explained by the action of seller(s):

An increase in demand and an increase in supply will:

You are asked to determine, other things equal, the effects of a given change in a determinant of demand or supply for product Xupon (1) the demand (D) for, or supply (S) of, X, (2) the equilibrium price (P) of X and (3) the equilibrium quantity (Q) of X.Refer to the above.If X is an inferior good, a decrease in income will:

The demand for commodity X is represented by the equation P = 10 - 0.2Q and supply by the equation P = 2 + 0.2Q.Refer to the above information.After the change in demand, the new equilibrium price is:

A news story states that "Videotapes lose their appeal as consumers switch to DVDs for movies." In a competitive market for the purchase of videotapes of movies, this situation would lead to a(n):