Econ 1014 Exam 1 Study Guide

If suppliers of a good are very responsive to changes

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2) If suppliers of a good are very responsive to changes in the price of their good, then: a. The supply curve will be very flat, because even small change in price will lead to a big change in the quantity supplied b. The supply curve slope will be small since the slope represents the change in the vertical axis (price) divided by the change in the horizontal axis (quantity supplied) c. If consumers want suppliers to offer more goods for sale, they can offer even a small price increase and suppliers will produce more d. All of the above e. None of the above 3) According to Law of Supply: 4) A supply curve: Unit 2 Section 4: Equilibrium 1) If the price of the good is above the market equilibrium:
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2) If the price of the good is below the market equilibrium: a. There will be a shortage of the good and market forces will try to force the price down to equilibrium b. There will be a surplus of the good and market forces will try to force the price down to equilibrium c. There will be a shortage of the good and market equilibrium price will rise d. There will be a surplus of the good and market equilibrium price will rise e. None of the above
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