Unit 5

Question 1

A table showing quantities supplied at different possible prices.

Answer 1

Supply schedule

Question 2

The amount of a good or service that a consumer is willing and able to purchase at a specific price.

Answer 2

Quantity demand

Question 3

The amount of a good or service that consumers are able and willing to purchase at a specific time period.

Answer 3

Demand

Question 4

The amount of a good or service that a producer is willing and able to supply at a specific price.

Answer 4

Quantity supplied

Question 5

A table showing quantities demand at different possible prices.

Answer 5

Demand schedule

Question 6

The amount of a good or service that producers are able and willing to sell at various prices during a specific time period.

Answer 6

Supply

Question 7

The price at which the amount producers are willing to supply is equal to the amount consumers are willing to buy.

Answer 7

Equilibrium price

Question 8

Economic rule stating that the quantity demand and price move in opposite directions.

Answer 8

Law of demand

Question 9

Economic rule stating that quantity supplied and price move in the same direction.

Answer 9

Law of supply

Question 10

A legal maximum price that may be changed for a particular good or service.

Answer 10

Price Celling

Question 11

A legal minimum price below which a good or service may not be sold.

Answer 11

Price floor

Question 12

What creates a shortage?

Answer 12

When the quantity demand is greater than the quantity supply.

Question 13

What creates a surplus?

Answer 13

Price floor

Question 14

The ability of a good or service to satisfy a customers want.

Answer 14

Utilities

Question 15

the additional amount of satisfaction.

Answer 15

Marginal utilities

Question 16

Economic rule stating that the additional satisfaction of a customer gets from purchasing one more unit of a product declines with each additional unit purchased.

Answer 16

Law of marginal utility

Question 17

Economic rule stating that as more units of a factor of production are added, total output continues to increase, but at a diminishing rate.

Answer 17

Law of diminished return

Question 18

Economic rule stating that individuals cannot keep buying the same quantity of a product if its price rises while their income stays the same.

Answer 18

Real income affect

Question 19

Economic rule stating that if two items satisfy the same needs in the price of one rises, people Will buy the other.

Answer 19

Substitution effect

Question 20

What is an sample of a complementary good?

Answer 20

Batteries and gas

Question 21

Economic concept dealing with how consumers respond to change in price.

Answer 21

Elasticity

Question 22

Salt and pepper are examples of goods that have what type of demand?

Answer 22

Inelastic, we will buy these no matter what

Question 23

A house is an example of a good that has what type of demand?

Answer 23

Elastic

Question 24

What are the determinants of demand

Answer 24

Change in population, income, taste preferences, complementary goods

Question 25

What determines supply?

Answer 25

Price of inputs

Question 26

If the price of inputs increase which way does the supply curve move

Answer 26

To the right

Question 27

If the population increases the demand curve shifts which way?

Answer 27

Right

Question 28

Distribution of goods and services based on something other than price.

Answer 28

Rationing

Question 29

Underground or illegal markets in which goods are treated at prices above their legal maximum price or in which illegal goods are sold.

Answer 29

Black market

Question 30

If prices go up and your income does not change this is an example of what?

Answer 30

Real income affect

Question 31

The process of freely exchanging goods and services between buyers and sellers.

Answer 31

Market

Question 32

A transaction in which a buyer and the seller exercise their economic freedom by working out their own terms of exchange.

Answer 32

Voluntary exchange