Unit 3 Microeconomics Review Game SSEMI1-3

Review game rules First team to raise the correct answer on their board in the air earns the point. DON’T shout out answers! First place= +6 Second place= +5 Third place= +4

Ready… Set… Here we go!

The equilibrium price, or the market clearing price, is the point at which consumer demand is ________ to the supply from businesses.

equal

The reliance on one another to provide the goods and services that people need. Product Market Economic interdependence C. Factor market

B

In a market economy, ______ serves as an incentive for consumer to purchase a product. A. Shortage Surplus Price

C

Solid arrows represent ________________.

Goods and services

Suppose consumers see an increase in the price of peanut butter Suppose consumers see an increase in the price of peanut butter. We would expect A. The demand for jelly to increase B. The demand for jelly to decrease

B

The law of supply states that if businesses can charge a higher price for a good or service, then they will supply more to maximize their ________.

profits

If the price goes from $2 to $3, then the quantity supplied will increase to _______.

200

Suppose that there is an increase in input prices Suppose that there is an increase in input prices. We would expect supply to ___________________.

decrease

In this graph, supply is going up and price is going ________.

down

A new super computer will allow producers to lay off 1,500 works and increase production. Therefore, the supply curve will shift to the __________.

right

• Many sellers in market • Products are identical • Easy to enter and exit the market • Price takers This describes _________ Competition.

Perfect (Pure)

When buyers and sellers interact in a market, a _______________ price is determined.

Equilibrium

Equilibrium price is $______ for this product.

$2

• Many sellers in market • Product must be different to attract consumers • Lots of advertising • Easy to enter and exit the market This describes ________________ Competition.

Monopolistic

This graph shows a _____________ in quantity demanded.

increase

If the headline of a newspaper read, “Study shows orange juice causes disease,” then the demand curve for orange juice would shift to the _______.

Left

A surplus exists _______________ the equilibrium price.

above

Form of business that has low liability, access to large amounts of cash, and has the longest life span would be a ______________.

corporation

Businesses sell goods and households buy them in the ___________ market.

Product

If the government subsidizes a farm, then the production of that farm should go _______.

Up

-Income goes down -Population in a market area decreases -Price of a substitute good goes down -Price of a complimentary good goes up All of these factors would cause the demand curve to shift to the ____________.

Left

Which graph shows an increase in supply? B C D

Graph A

The law of demand states that as price goes down, the quantity demanded goes ______.

Up

______________ competition has similar or identical products but multiple businesses that sell that product. You need a lot of advertising to distinguish your product from others.

Monopolistic

____________ have the least liability, the most profits, but get double taxed as a business.

Corporations

One benefit of a _________ proprietorship is that you get to keep all of the profits, but you have the most liability if your business fails.

sole

A price ceiling ________ the equilibrium price causes a shortage.

below

A price ______ above the equilibrium causes a surplus.

floor

Bonus Question- 10 points Draw a graph that shows the production of Red Sox Nation as being inefficient.