Summary: Emba: Markets And Economies

Read the summary and the most important questions on EMBA: MARKETS AND ECONOMIES

• 1 Microeconomics I: Supply & Demand

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• 1.1.1 What is Microeconomics?

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• What are the two assumptions that macroeconomists make about their study of economic units and how they behave?

  They are rational
  They seek to maximize the benefits they gain

• 1.1.2 The Demand Curve

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• True or False. Just like individual demand curves, market demand curves can shift too.

  True

• What plots the quantity of a good or service demanded at different prices?

  Demand Curve (DC)

• 1.1.3 The Supply Curve

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• What law states that when the market price for a good or service increases, the quantity that suppliers produce and sell increases, and vice versa?

  Law of Supply

• True or False. Buyers have demand schedules, and sellers have supply schedules.

  True

• What plots the supply schedule?

  Supply Curve (SC)

• True or False. When supply curve shifts to the left, market supply has increased, and when shifts to the right it decreased.

  False

• 1.1.4 Law of Supply and Demand

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• What is the synonym of Equilibrium Price?

  Market-Clearing Price

• If supply > demand, there is a ________. Prices will drop until equilibrium is met.

  Surplus

• True or False. Supply = demand: The market has reached equilibrium.

  True