Market Equilibrium & Policy Module
Discipline: Economics
Type of Paper: Question-Answer
Academic Level: Undergrad. (yrs 3-4)
Paper Format: APA
Question
Economics/Microeconomic Theory
When the market is in equilibrium, the price that consumers pay and that producers receive exactly balances the
marginal benefit and marginal cost of consuming and producing a good or service.
A situation in which the quantity of output demanded is greater than the quantity of output supplied at the current market price is called a
A shortage occurs when:
A shortage occurs when:
the quantity of output demanded is greater than the quantity of output supplied at the current market price.
A situation in which the quantity of output supplied is greater than the quantity of output demanded at the current market price is called _____.
surplus
Shortages and surpluses are represented by the:
horizontal distance between the quantity demanded and the quantity supplied.
Equilibrium means that:
we should expect to see the price and the quantity converge at specific levels.
When the market is in equilibrium, the price that consumers pay and that producers receive:
balances the marginal benefit and marginal cost of consuming and producing a good or service.
Which of the following is true of a normal good?
The quantity demanded falls as the price rises.
A situation in which the quantity of output demanded is greater than the quantity of output supplied at the current market price is called a __________.
shortage or deficit
A surplus occurs when:
quantity demanded < quantity supplied.
In equilibrium:
the quantity supplied equals the quantity demanded.
The nonprice determinants or other factors that affect demand are held constant for any given:
demand curve.
When the _____ of a good changes, the quantity demanded changes.
price or cost
A shortage is sometimes called
excess demand
A surplus occurs when:
supplied is greater than the quantity of output demanded at the current market price.
A nonprice determinant of demand is:
a characteristic of demand for a good, service, or resource other than its own market price.
Shortages and surpluses are represented by the:
horizontal distance between a point on the demand curve at a particular price and a point on the supply curve at the same price.
Non-price determinants are held ____ for any given demand curve. (Use one word for the blank.)
constant
When the price of a good, service, or resource increases:
the quantity supplied increases.
Which of the following is true of a normal good?
The non-price determinants or other factors that affect supply are:
held constant for any given supply curve.
Shortages:
are usually the product of price controls.
When a nonprice determinant of supply changes:
the relationship between the quantity supplied and the price changes.
A characteristic of demand for a good, service, or resource other than its own market price is: a nonprice determinant of demand.
Identify which of the following is an example of a shortage.
No snow shovels are available when a blizzard is forecast.
When a shift of the supply curve occurs:
more or less is supplied at every price.
Which of the following occurs when the price of a good increases?
There is an increase in the quantity supplied.
Non-price determinants are held _____ (one word) for any given supply curve.
constant
A change in a nonprice determinant of supply will:
result in a shift of the supply curve.
The market adjusts to a new equilibrium price and quantity when a non-price ______ of supply changes.
determinant or factor
A nonprice determinant of demand is: