Which best describes the role the availability of resources plays when a company is considering whether to produce a certain good?
Resources can always be obtained, no matter what the cost
. If a resource is difficult to obtain, production costs will be high.
Which best describes why the law of supply operates the way it does in a free enterprise economy?
Which best explains why the law of supply operates the way it does in a free enterprise economy?
Companies want to be as profitable as possible.
microeconomics.
How does the law of supply say the factor will respond to the increase in the price of blue widgets?
The law of supply says that the factory will respond by
producing more blue widgets
. Under the current model, input costs aside, the factory stands to make $100 dollars a day if both blue and green widgets are priced at $5 a widget.
Which best describes what happens to the amount of goods and services that is supplied to consumers?
Which best describes what happens to the amount of a good or service that is supplied to consumers?
The amount of a good or service can change
. The amount of a good or service always remains the same. … The amount of a service cannot change.
What is a measure of behaviors by producers and consumers in response to changes in price?
Elasticity
is the measure of behaviours by producers and consumers in response to changes in price. It is the conic term which measures how the supply and demand is affected and changed because of an increase or decrease in price.
What are the 6 characteristics of a free market economy?
What are the six major characteristics of a pure market economy?
Freedom of enterprise, little or no government control, freedom of choice, private property, profit incentive, and competition
.
What is the key to free enterprise?
The U.S. economic system of free enterprise has five main principles: the
freedom for individuals to choose businesses
, the right to private property, profits as an incentive, competition, and consumer sovereignty.
What happens when the price of a good increases?
An increase in the price of a good
will increase demand for its substitute
, while a decrease in the price of a good will decrease demand for its substitute. … An increase in the price of a good will decrease demand for its complement while a decrease in the price of a good will increase demand for its complement.
What usually happens to the demand for a good or service when the price increases?
According to the law of demand, as the price of a good or service increases, the:
Quantity demanded of the good or service will decrease
. … The demand for good A will decrease and the demand curve will shift to the left.
Which events could cause the change in demand shown?
Factors that can shift the demand curve for goods and services, causing a different quantity to be demanded at any given price, include
changes in tastes, population, income, prices of substitute or complement goods
, and expectations about future conditions and prices.
Which is an example of a positive incentive for consumers?
Example of positive incentives for consumers will be
a discount coupon or free sample of any product with the purchase of some other product
.
Which best describes a reason that consumer demand can change?
Which best describes a reason that consumer demand can change? …
It helps consumers tell producers when prices are too high
.
What is the law of supply example?
The law of supply
summarizes the effect price changes have on producer behavior
. For example, a business will make more video game systems if the price of those systems increases. The opposite is true if the price of video game systems decreases.
Which factors must Producer consider when deciding what good to supply?
the appeal of the good to family members the elasticity of a good being supplied competition within
the market the ability to produce the good efficiently the ability to produce a good of low quality.
What does high price elasticity mean?
Price elasticity of demand measures the change in consumption of a good as a result of a change in price. … This product would be considered highly elastic because it
has a score higher than 1
, meaning the demand is greatly influenced by price change.
How will an increase in the price of inputs shift the supply curve?
Price of inputs: If the price of inputs increases the supply curve will
shift left as sellers are less willing or able to sell goods at any given price
. Inputs include land, labor, energy and raw materials. Number of suppliers: As more firms enter the industry the market supply curve will shift out driving down prices.
