Show:
Chapter 4
Chapter 4 part 2
Chapter 4 part 3
Chapter 5
Chapter 5 part 2
100
What does the law of demand say about lower prices?
Lower prices increase quantity demanded
100
Give one example of complementary goods.
Answers will vary
100
A good that consumers demand more of when their incomes increase
Normal good
100
The tendency of suppliers to offer more of a good at a higher price
Law of supply
100
A government payment that supports a business of market
Subsidy
200
When consumers react to an increase in a good’s price by consuming less of that good and more of other goods
Substitution effect
200
A measure of how consumers react to a change in price is the definition of what
Elasticity of demand
200
A good that consumers demand less of when their income increases
Inferior good
200
A supply schedule provides what information
The relationship between price and quantity supplied for a specific good
200
How would the supply of apples probably be affected if the price of apples was expected to drop in the near future?
The supply would increase just before the price drop as suppliers placed goods on the market
300
Which of the following is plotted on the vertical axis of a demand curve
Price
300
Give one example of a good with inelastic demand
Answers will vary - gas, prescription drugs, etc.
300
The total amount of money a firm receives by selling goods or services
Revenue
300
If supply is inelastic, how will supply react to a small increase in price
Supply will not change
300
Assuming that a $1 per pound tax has been placed on chicken. What effect will this have on the supply curve for chicken?
The supply curve will move to the right
400
Two factors that will cause a shift in demand
Income, Consumer expectations, Population, Consumer tastes, advertising
400
What is the relationship between elastic demand and total revenue? Finish this statement - Prices rise, demand falls, revenue ___________________
Prices rise, demand falls, revenues decrease
400
A graphic representation of a demand schedule
Demand curve
400
Why might marginal product of labor decrease when one increases the amount of workers
Increasing workers but failing to increase capital will likely result in a decrease in marginal product of labor
400
The change in output from hiring one additional unit of labor
Marginal product of labor
500
How does the ceteris paribus assumption affect a demand curve
It allows the demand curve to exist as a constant without variables other than price affecting it.
500
Give one example of complementary goods
Answers will vary
500
Describes demand that is very sensitive to a change in price
Elastic
500
Why goes the government impose excise taxes on some goods
To discourage the sale of goods deemed harmful to the public good
500
Government intervention in a market that affects the production of a good
Regulation