Chapter 4 Review Supply

Question 1: / T/F : A change in price is always a movement along the curve.

Question 2: / _______________ is the amount of a good or service a producer is willing to sell at a particular price.

Question 3: / ___________ states that producers supply more goods and services at higher prices and fewer goods and services at lower prices.

Question 4: / What is the amount of money remaining after producers have paid all of their costs?

Question 5: / What are expenditures on workers’ wages, rent, interest on loans, electricity, raw materials, and other goods or services used to manufacture a product?

Question 6: / What lists the quantity of a product that producers will supply at various market prices?

Question 7: / Supply tends to ______ when there is a lack of competition. / (Increase or Decrease)

Question 8: / What is the situation that exists when a small change in a good’s price causes a major change in the quantity supplied?

Question 9: / What is the situation that exists when a change in a good’s price has little impact on the quantity supplied?

Question 10: / What are the six determinants of supply?

Question 11: / What makes a good elastic?

Question 12: / What makes a good inelastic?

Question 13: / What are two examples of government tools?

Question 14: / ________ are production costs that change as the level of output changes.

Question 15: / _________ are the sum of a company’s fixed and variable production costs.

Question 16: / What are productions costs that do not change as the level of output changes?

Question 17: / The total fixed costs of a company is referred to as ___________.

Question 18: / Variable Costs or Fixed Costs: A. Raw Materials B. Property Taxes C. Salaries D. Rent E. Wages

Question 19: / Steve decides to plant sugar beets instead of sunflowers this spring because the price of sugar beets is increasing this summer. What determinant of supply is at work and explain on the curve where the market will shift? / Determinant:_______________________

Question 20: / The price of leather has fallen tremendously in the past few days. Diamond Baseballs have stepped up production due to reduction in production costs. What determinant of supply is at work? Demonstrate which way the supply curve will move due to the determinant at work. / Determinant:________________________