The law of demand states that if the price of a good falls and all other things remain the same, the
  • quantity demanded of the good rises.
Suppose that supply increases and demand decreases. What effect will this have on price and quantity?
  • None of the statements associated with this question are correct.
If steak is a normal good, what do you suppose would happen to price and quantity during an economic recession?
  • Price and quantity would both decrease.
Suppose market demand and supply are given by Qd = 100 – 2P and QS = 5 + 3P. If a price floor of $30 is set, what will be size of the resulting surplus?
  • 55
Suppose market demand and supply are given by Qd = 100 – 2P and QS = 5 + 3P. If a price ceiling of $15 is imposed, what will be the resulting full economic price?
  • $25
Suppose market demand and supply are given by Qd = 100 – 2P and QS = 5 + 3P. If a price ceiling of $15 is imposed,
  • there will be a shortage of 20 units.
Suppose the supply of good X is given by QS x = 10 + 2Px. How many units of good X are produced if the price of good X is 20?
    For a steel factory, a decrease in the cost of electricity to the plant will cause the supply curve to:
    • shift to the right.
    The economic principle that producers are willing to produce more output when price is high is depicted by the:
    • upward slope of the supply curve.
    The curve which summarizes the total quantity producers are willing and able to produce at differing prices is the:
    • market supply curve.