Econ Hw 2 (Peralta)

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A movement along a supply curve is called a change in supply while a shift of the supply curve is called a change in quantity supplied.
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Terms in this set (31)
Which of the following is not a characteristic of a perfectly competitive market?All of the above are characteristics of a perfectly competitive market.Which of the following is the least likely to be a competitive market?cable televisionWhich of the following would most likely serve as an example of a monopoly?a local cable television companyA downward-sloping demand curve illustratesthe law of demand.A leftward shift of a demand curve is called adecrease in demandA likely example of complementary goods for most people would bechips and salsa.A likely example of substitute goods for most people would bepencils and pens.A market demand curve shows how the total quantity demanded of a good varies asprice varies.A movement upward and to the left along a demand curve is called adecrease in quantity demanded.When quantity demanded decreases at every possible price, the demand curve hasshifted to the left.When we move along a given demand curve,all nonprice determinants of demand are held constant.A decrease in quantity suppliedresults in a movement downward and to the left along a fixed supply curve.A leftward shift of a supply curve is called adecrease in supply.Lead is an important input in the production of crystal. If the price of lead decreases, then we would expect the supply ofcrystal to increase.Suppose an increase in the price of rubber coincides with an advance in the technology of tire production. As a result of these two events, the demand for tiresNone of the above is necessarily correct.The sum of all the individual supply curves for a product is calledmarket supplyWhich of these statements best represents the law of supply?When the price of a good decreases, sellers produce less of the good.A shortage exists in a market ifthe current price is below its equilibrium price.Another term for equilibrium price ismarket-clearing price.Equilibrium quantity must increase when demandincreases and supply does not change, when demand does not change and supply increases, and when both demand and supply increase.If a shortage exists in a market, then we know that the actual price isbelow the equilibrium price, and quantity demanded is greater than quantity supplied.