Market Demand Functions and Shifts

<p>Changes in consumer preferences (D)</p> Signup and view all the answers

<p>The price of the good (B)</p> Signup and view all the answers

<p>The demand for the other good increases (A)</p> Signup and view all the answers

<p>Normal good (D)</p> Signup and view all the answers

<p>The demand for beer will decrease (C)</p> Signup and view all the answers

<p>Second hand furniture (B)</p> Signup and view all the answers

<p>They can increase demand for goods based on personal liking (B)</p> Signup and view all the answers

<p>Anticipating a future price drop (C)</p> Signup and view all the answers

<p>Increase demand for the product (C)</p> Signup and view all the answers

<p>Daily variations in consumption (C)</p> Signup and view all the answers

<p>Monopoly (A)</p> Signup and view all the answers

<p>Perfectly competitive market (D)</p> Signup and view all the answers

<p>Products that consumers view as identical (B)</p> Signup and view all the answers

<p>Goods and services are public goods (C)</p> Signup and view all the answers

<p>The number of suppliers in the market (A)</p> Signup and view all the answers

<p>Market for milk in Europe (B)</p> Signup and view all the answers

<p>The number of competitors present (A)</p> Signup and view all the answers

<p>Oligopoly (D)</p> Signup and view all the answers

<p>Marginal costs increase as more resources are used. (D)</p> Signup and view all the answers

<p>p = S -1(q) (D)</p> Signup and view all the answers

<p>By multiplying the individual supply function by the number of producers. (D)</p> Signup and view all the answers

<p>Because more producers contribute to the supply at the same price. (D)</p> Signup and view all the answers

<p>They vary significantly among different producers. (C)</p> Signup and view all the answers

<p>Supply functions are assumed to be linear. (C)</p> Signup and view all the answers

<p>Upward sloping. (C)</p> Signup and view all the answers

<p>Combined supply at each price level. (A)</p> Signup and view all the answers

<p>Reservation Price (D)</p> Signup and view all the answers

<p>Law of Demand (B)</p> Signup and view all the answers

<p>Difference between maximum willingness to pay and paid market price (A)</p> Signup and view all the answers

<p>Giffen goods (B)</p> Signup and view all the answers

<p>Sum of all individual consumer surplus (D)</p> Signup and view all the answers

<p>Consumers will not purchase sandwiches (B)</p> Signup and view all the answers

<p>Demand decreases as income decreases (C)</p> Signup and view all the answers

<p>Willingness to pay may exceed, be equal to, or be less than market price (B)</p> Signup and view all the answers

<p>Revenues definitely decrease. (D)</p> Signup and view all the answers

<p>It increases at all price levels. (C)</p> Signup and view all the answers

<p>Only one variable is changing while others are constant. (D)</p> Signup and view all the answers

<p>It may decrease or remain unchanged. (B)</p> Signup and view all the answers

<p>Some suppliers may exit the market. (B)</p> Signup and view all the answers

<p>Equilibrium quantity is likely to increase. (B)</p> Signup and view all the answers

<p>Decreased production costs. (B)</p> Signup and view all the answers

<p>Higher quantities will lead to lower marginal returns. (C)</p> Signup and view all the answers

A market structure where there are many buyers and sellers, each with a negligible impact on the market price. Products are identical, and buyers prioritize the lowest price.

A market where one seller controls the entire supply of a product. This firm dictates the price.

A market structure with only a few sellers. Each firm has some control over price, but must consider how their competitors will react.

A market structure where two firms control the entire supply of a product.

When producers have minimal control over the price of their products. The market price is dictated by the forces of supply and demand.

The ability of a company to influence the market price of its product. It can either raise prices above market levels or reduce output.

Products from different sellers are considered identical by consumers. Buyers focus on the price.

Products from different sellers are considered distinct by consumers. Factors like brand, quality, and features impact choices.

The total amount of a good or service that all consumers in a market are willing and able to purchase at a given price.

A graphical representation of the relationship between the price of a good and the quantity demanded by consumers.

A change in the quantity demanded of a good due to a change in its own price, moving along the existing demand curve.

A shift of the entire demand curve, caused by changes in factors other than the price of the good.

A change in income, taste, or any other factor that alters consumers' willingness to buy a good, resulting in a shift of the demand curve.

The maximum price a consumer is willing to pay for a good or service.

The relationship between the price of a good and the quantity demanded, showing that as the price increases, the quantity demanded decreases.

The total amount of money consumers are willing to pay for a good or service, represented by the area under the demand curve.

The difference between a consumer's maximum willingness to pay for a good and the actual price paid.

A market structure where there are many buyers and sellers, with no single entity having significant control over prices.

Two goods where an increase in the price of one leads to an increase in the demand for the other. Think of choosing one good over the other.

Two goods where an increase in the price of one leads to a decrease in the demand for the other. Think of consuming these goods together.

A good where demand increases as your income increases.

A good where demand decreases as your income increases.

A shift in demand caused by changes in income levels.

A change in demand resulting from altered personal preferences.

A change in demand influenced by beliefs about the future.

A change in demand driven by advertising efforts.

The relationship between the quantity of a good supplied and its price, where the quantity supplied is directly proportional to the price.

The cost of producing one additional unit of a good.

The principle that as more units of a factor of production are added to a fixed factor, the marginal product of the variable factor will eventually decline.

The sum of the individual supply functions of all producers in a market.

A market supply function that is the result of identical producers adding their individual supplies.

A market supply function that is the result of producers with different cost structures adding their individual supplies.

The function that describes the relationship between the quantity of a good supplied and the market price.

The graphical representation of the supply function.

The assumption that all other factors besides the one being considered remain constant. It's commonly used in economics to isolate the effect of a single variable on the outcome.

A change in the conditions that causes consumers to buy less of a product at any given price.

A change in the conditions that causes suppliers to produce more of a product at every price, often due to cheaper production costs.

The law of diminishing returns states that as more units of a variable input are added to a fixed input, the marginal output eventually declines. This doesn't apply when there's a supply shock, as the shock itself changes the production conditions.

When the price of a good falls, some producers may exit the market, even if overall production has increased. This is because the reduced price makes it unprofitable for some suppliers to continue.

The impact of a positive supply shock on producer revenues is uncertain because equilibrium price and quantity move in opposite directions. An increase in production may lead to a lower price, impacting overall revenue.

A state where the forces of supply and demand are balanced, leading to a specific price and quantity of goods exchanged in the market.

The impact of a negative demand shock on producer revenues is unambiguous because both equilibrium price and quantity move in the same direction. Lower demand leads to both lower prices and quantities sold, impacting revenue.