Understanding Market Equilibrium: Price Changes and Demand
School
Indiana University, South Bend**We aren't endorsed by this school
Course
ECON 104
Subject
Economics
Date
Dec 12, 2024
Pages
1
Uploaded by JudgeOxideCoyote22
Which of the following events will cause a decrease in the equilibrium price?lower input pricesFive new sellers enter a market (that previously had seven) and begin producing a good. Which of the following choices explains what happens to the equilibriumQandP?The supply curve will shift to the right, the equilibrium P will fall, and the equilibrium Q will rise.In a free market when there are unexploited gains from trade:there are buyers who are willing to pay more for goods than sellers are asking.Imagine a free market in which at a price of $10, quantity supplied is 50 units and quantity demanded is 50 units. Equilibrium price in this market:is equal to $10.In a free market setting where quantity supplied is 50 units and quantity demanded is 40 units, price will: fallTim values treats for his dog at $10 per box, and John values them at $6 per box. If the price of dog treats is $3per box, but only one box is available between these two buyers, then gains from trade will be maximizedwhen: Tim buys the treats.Suppose there is an increase in demand in a market and no change in the supply. What will happen to the market equilibrium price and quantity?Equilibrium price will rise; equilibrium quantity will riseCorrect!An early frost in the vineyards of Napa Valley would cause a(n):decrease in the supply of wine, increasing price.An increase in demand causes a:temporary shortage at the old equilibrium price and a higher new equilibrium price and quantity.If demand increases,ceteris paribus, market price will be ______ at the new equilibrium point. higherA technological innovation in the production of golf balls increases ______, causing the price to ______ and the ______.supply; fall; quantity demanded to increaseWhich choice explains how the OPEC crisis of 1973 affected oil prices?The supply of oil was reduced, leading to a rise in oil pricesEconomic growth in China has led to more Chinese people owning cars, which:increased demand for oil, causing oil prices to rise.
