Chapter 3 Post Quiz
Basic Elements of Supply and Demand

Matching Questions:

Match the terms on the left with the definition in the column on the right. Enter the lowercase letter of that definition in the box to the left of the question number.

	1. demand curve	a. causes an increase in demand.
	2. law of downward-sloping demand	b. consumers will shift consumption from good X to good Y when the price of good X increases.
	3. substitution effect	c. results from the summing up of the individual demands at each price of all consumers in the market.
	4. income effect	d. a graphical representation of the negative relationship between price and the number of units consumers are willing to buy.
	5. market demand	e. determinants of both supply and demand.
	6. prices of related goods	f. states that when price decreases, buyers tend to buy more.
	7. increase in the size of the market	g. consumers will buy less of good X when the price of good X increases because the increase in the price of good X makes the consumer relatively poorer.
	8. change in the price of a good	h. causes a leftward shift of the demand curve.
	9. decrease in average income	i. causes a movement along the demand curve.
	10. supply curve	j. causes the supply curve to shift to the left.
	11. increase in the cost of production.	k. can be determined by the market forces of supply and demand.
	12. market equilibrium	l. shows the number of units that producers are willing to sell at each price.
	13. what, how, for whom	m. where the supply and demand curves cross.
	14. equilibrium price increases, equilibrium quantity decreases	n. occurs when supply falls, all other things held constant.
	15. equilibrium price and quantity both decrease.	o. occurs when demand falls, all other things held constant.