1) Demand and supply - answer key

# 1) Demand and supply - answer key - Answer Key Testname 1...

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Answer Key Testname: 1) DEMAND AND SUPPLY 1) C 2) A 3) B 4) B 5) B 6) C 7) False. The demand for a product is independent of its supply. It is possible that people want to buy some of the product but at prices that are below what sellers would require to begin production. 8) False. The statement claiming a contradiction confuses a change in quantity demanded with a change in the demand curve. The law of demand refers to movements along a given demand curve. The mild weather caused a leftward shift of the demand curve. 9) The market demand is Q M = N · Q = N(a - bp) = Na - Nbp . The slope of the market demand is Nb which is greater (more flat on graph) than the individual demand curve. 10) B 11) A 12) A 13) False. There is no Law of Supply. Supply curves can take multiple shapes and thus don't have to be upward sloping. (p. 22) 14) Without a quota, the supply curve will fullow the domestic supply curve for Q K 5 and p = 15 for Q > 5. With the quota, for Q > 15 thesupply rises with the domestic supply 10

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Answer Key Testname: 1) DEMAND AND SUPPLY 15) B 16) C 17) A 18) D 19) C 20) C 21) A 22) D 23) True. During a mild winter, people do not need to operate their furnace as often as in a normal winter. The demand for
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## This note was uploaded on 08/01/2011 for the course ECON 101 taught by Professor Brentkreider during the Fall '07 term at Iowa State.

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1) Demand and supply - answer key - Answer Key Testname 1...

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