11. People benefit by participating in the market because: Participants in the m

Question

11. People benefit by participating in the market because:

Participants in the market do not have to make choices.

12. A lower quantity demanded of a good reflects, ceteris paribus:

All of the above.

13. An increase in the price of one good can cause an increase in the demand for another good if the goods are:

Not necessary and can therefore be cut from a consumer's budget.

14. An increase in the price of a good causes a:

Leftward shift in the demand curve.

15. When the number of sellers in a market increases, ceteris paribus:

Both (A) and (C).

16. If a farmer could plant either corn or wheat (substitute goods) on the same plot of land, a shift in the supply curve for corn will take place when, ceteris paribus:

All of the above.

17. When a surplus exists:

All of the above.

18. If the quantity demanded of a good is less than the quantity supplied of the good at the current price, then:

There is a surplus of the good.

19. A leftward shift in a demand curve and a rightward shift in a supply curve both result in a:

Higher equilibrium quantity.

20. When supply decreases, ceteris paribus, the equilibrium price will increase because:

Explanation / Answer

Q11. Answer is Market participation allows individuals to specialize and ultimately, consume more. Q12. Answer is A higher price of the goods. Q13. Answer is Substitutes. Q14. Answer is Movement up along the supply curve Q15. Answer is The market supply curve shifts right. Q16. Answer is The Price of wheat changes Q17. Answer is Producer reduce price in an attempt to decrease excess inventory. Q18. Answer is The price will increase untill it reaches the equilibrium price. Q19. Answer is Lower equilibrium price. Q20. Answer is A shortage exists at the old equilibrium price.

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