Practice Questions
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What happens to the market equilibrium price when a technological advancement reduces production costs for suppliers?
When production costs go down, suppliers can make more products for less money. Other options are incorrect because Some might think that lower costs ...
What happens to the equilibrium price and quantity in a market when there is an increase in demand while supply remains constant?
When more people want to buy something, the price goes up. Other options are incorrect because This answer suggests that the price goes down, which is...
What is the likely effect of a price ceiling set below the market equilibrium price on the supply and demand in a market?
When a price ceiling is set below the market equilibrium, it means prices can't go high enough. Other options are incorrect because Some might think a...
If the demand for a product is elastic and there is a significant increase in the cost of production leading to a leftward shift in the supply curve, what is the likely outcome in terms of market equilibrium?
When production costs go up, it becomes harder to make the product. Other options are incorrect because This answer suggests that price will go down, ...
If consumer preferences shift towards a product, how does this affect market equilibrium and what could potentially lead to a market shortage?
When more people want a product, demand goes up. Other options are incorrect because This option suggests that less demand leads to lower prices and e...
What happens to the market equilibrium price and quantity when there is an increase in demand while supply remains constant?
When more people want to buy a product, the price goes up. Other options are incorrect because Some might think that if demand goes up, prices should ...
What occurs in a market when demand increases while supply remains constant?
When more people want a product but there is the same amount available, the price goes up. Other options are incorrect because Some might think that h...
What happens to the equilibrium price of a product when there is an increase in demand while supply remains constant?
When more people want to buy a product, they are willing to pay more for it. Other options are incorrect because Some might think that more demand mea...
Arrange the following steps in the correct order that describe the impact of an increase in demand and a decrease in supply on market equilibrium: A) Market price increases B) Demand curve shifts right C) Supply curve shifts left D) New equilibrium quantity established
When demand increases, the demand curve shifts to the right. Other options are incorrect because This option suggests that supply changes before deman...
An increase in demand while supply decreases is to market price rising as an increase in consumer confidence is to what?
When people feel confident about the economy, they tend to spend more money. Other options are incorrect because Some might think that more production...
A sudden increase in consumer preferences for electric cars occurs simultaneously with a significant rise in production costs for manufacturers. How would you classify the resulting changes in market equilibrium for electric cars?
When more people want electric cars, demand goes up. Other options are incorrect because This option suggests that price changes are unclear, but dema...
A local coffee shop experiences an increase in customer preference for specialty coffee while facing a shortage of coffee beans due to a recent drought. How will this situation likely impact the market equilibrium for specialty coffee in the short term?
When more people want specialty coffee, demand goes up. Other options are incorrect because Some might think that if supply is low, prices should drop...
When demand increases and supply decreases in a competitive market, which of the following outcomes are likely to occur? (Select all that apply)
In this situation, we can't say for sure what will happen to price or quantity. Other options are incorrect because Some might think that prices will ...
If demand increases while supply decreases, what is the likely impact on market equilibrium price and quantity?
When more people want a product but there is less of it available, prices go up. Other options are incorrect because This option suggests that both pr...
If demand increases while supply decreases, what is the most likely effect on market equilibrium?
When more people want a product but there are fewer available, prices go up. Other options are incorrect because This answer suggests that more demand...
If the market experiences a simultaneous increase in demand and a decrease in supply, what is the most likely outcome on the equilibrium price and quantity?
When demand goes up, people want to buy more. Other options are incorrect because This answer suggests that quantity will increase, but that's not tru...
When there is an increase in demand and a decrease in supply, the market equilibrium price will generally _______ while the equilibrium quantity may be _______.
When more people want a product but there is less of it available, the price goes up. Other options are incorrect because This answer suggests that pr...
Master Analyzing Market Equilibrium Changes
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