Exam 3: Demand, Supply, and Market Equilibrium

Answer the question based on the following supply and demand schedules in units per week for a product. Refer to the above table. If the government introduced a guaranteed price floor of $40 and agreed to purchase surplus output, then the government's total support payments to producers would be:

Assume that the graphs show a competitive market for the product stated in the question. Select the graph above that best shows the change in the market specified in the following situation: In the market for wheat, when the cost of fertilizer decreases.

In the diagrams below, the subscript "1" refers to the initial position of the curve, while the subscript "2" refers to the final position after the curve shifts. Which diagram above illustrates the effects on the peanut butter market, if severe flooding destroys a large portion of the peanut crop in the economy?

"Price" in the statement of the Law of Supply refers to:

In a market with supply and demand curves as shown above, a price ceiling of $2.50 will result in:

Refer to the above graph with three demand curves. An "increase in quantity demanded" would be illustrated by a change from:

An increase in the demand for corn is more than offset by an increase in its supply. As a result the equilibrium price will:

All of the following are assumed to be constant when the supply curve for a product is drawn, except the:

A newspaper reports that the average price of new homes in a certain city had decreased, and the number of new homes sold had also decreased. This situation is probably caused by:

What will happen to the equilibrium quantity and price of salmon in a competitive market when there is an equal decrease in demand and supply?

In the diagrams below, the subscript "1" refers to the initial position of the curve, while the subscript "2" refers to the final position after the curve shifts. Which diagram above illustrates the effect on the natural-gas market, with the widespread use of "fracking" or hydraulic fracturing by gas-drilling companies?

When the government requires ethanol from corn to be used as an additive to gasoline, the supply of corn decreases.

Which is most likely to be observed in a community where legal ceilings are imposed on residential rents?

Which of the following factors will decrease the current demand for a product?

If product Y is an inferior good, a decrease in consumer incomes will:

In markets where the supply curve is vertical, changes in:

Which of the following goods would most probably be an inferior good?

In cases where the supply curve is vertical, any change in demand will cause only a change in price but no change in quantity.

A television station reports that the price of orange juice has declined but the quantity traded has increased. This situation could be caused by a(n):

Answer the question based on the following supply and demand schedules in units per week for a product. Refer to the above table. If demand increased by 100 units at each price level, and the government set a price ceiling of $40, then there will be: