1.Suppose there is an decrease in the price of wood. We would expect the supply
ID: 1135712 • Letter: 1
Question
1.Suppose there is an decrease in the price of wood. We would expect the supply curve for pencils to
shift leftward.
remained unchanged as the price of pencils and the quantity supplied move up.
shift rightward.
remain unchanged as the price of pencils and the quantity supplied move down.
2.
If a surplus exists in a market, then we know that the actual price is
A.above the equilibrium price, and quantity demanded is greater than quantity supplied.
B.below the equilibrium price, and quantity demanded is greater than quantity supplied.
C.above the equilibrium price, and quantity supplied is greater than quantity demanded.
D.below the equilibrium price, and quantity supplied is greater than quantity demanded.
a.shift leftward.
b.remained unchanged as the price of pencils and the quantity supplied move up.
c.shift rightward.
d.remain unchanged as the price of pencils and the quantity supplied move down.
Explanation / Answer
1) c) Shift rightward, If the cost of resources used to produce a good increase, then the sellers will have to supply the same quantity at that price.
2) c) Above the equilibrium price, and the quantity supplied is greater than quantity demanded.
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