Exam 3: Markets, Demand and Supply, and the Price System

Last year a firm made 1, 000 units of its product available at a price of $5 per unit.This year the firm will still make 1, 000 units available, but only if the price is $7 per unit.What is most likely to have happened?

The amount of a product that people are willing and able to purchase at a specific price is referred to as the:

Which of the following will cause an increase in the quantity demanded of ice cream at an ice cream store?

A price ceiling imposed on a good that is below the equilibrium price will result in a shortage of that good.

If both supply and demand for a good increase, which of the following will definitely happen?

A market survey conducted by an electronics manufacturer reported a year on year growth in the sale of television sets, along with an increase in the selling price.Which of the following could be a likely cause for this situation?

Other things remaining the same, if a large part of the population decided against having soda for health reasons, this would result in:

Which of the following statements is not true about a market system?

The exchange of goods and services directly without money is called:

Consider the market described by Table 3.4.Identify the correct statement.

Which of the following will cause an inward shift in the demand for steaks at a restaurant?

Other things remaining the same, an individual demand schedule shows the various quantities of a good:

The leaders of the reforms in the countries that turned from government-run economies to market economies were told by their economic advisers to watch the price of eggs, not the heavy industries such as power generation and oil refining, because:

A price floor does not benefit producers.

Which of the following statements correctly defines the law of demand?

The development of a low-cost synthetic fuel is expected to cause a decrease in the price of oil.

The table given below reports the quantity demanded and supplied of a commodity at different prices in a market. Table 3.5 Refer to Table 3.5.If government imposes a price floor of $2:

A price floor is the minimum price that consumers have to pay.

The market demand curve is derived by summing individual demand curves horizontally.

In a country that depends on the government to decide the allocation of resources,