ECON 300 MIDTERM 1 QUESTIONS AND
CORRECT ANSWERS WITH COMPLETE
SOLUTION | NEW 2026 UPDATE
4 key assumptions of the economic model - ANSWERS oSupply and Demand in
a single market
oAll goods in the market are identical
oAll goods sold in the market sell for the same price, and everyone has the same
info
oThere are many producers and consumers
supply - ANSWERS the combined amount of a good that all producers in a
market are willing to sell
demand - ANSWERS combined amount of a good that all consumers in a
market are willing to buy
commodities - ANSWERS products traded in markets in which consumers view
different varieties of the good as essentially interchangeable
factors that influence demand - ANSWERS price
number of consumers
wealth/ consumer income
tastes/preferences
,prices of other goods
substitutes - ANSWERS good that can be used IN PLACE of another good
complements - ANSWERS good that is purchased and used IN COMBINATION
with another good
demand curve - ANSWERS relationship b/w quantity of a good that consumers
demand and the goods price
demand choke price - ANSWERS price at which no consumer is willing to buy a
good
quantity demand is ZERO
vertical intercept of inverse demand curve
inverse demand curve - ANSWERS demand curve written in the form of price
as a function of quantity demanded
change in quantity demanded - ANSWERS movement ALONG demand curve
result of change in goods price
change in demand - ANSWERS SHIFT of demand curve
result of change in a determinant of demand other than the goods price
Determinants of Supply - ANSWERS price
, suppliers cost of production
# of sellers
sellers outside options
production technology - ANSWERS the processes used to make, distribute,
and sell a good
supply curves - ANSWERS graph relationship b/w quantity supplied of a good
and the good's price
supply choke price - ANSWERS price at with no firms is willing to produce a
good
quantity supplied is ZERO
vertical intercept of inverse supply curve
inverse supply curve - ANSWERS supply curve written in the form of price as a
function of quantity supplied
changes in quantity supplied - ANSWERS movement ALONG supply curve that
occurs as a result of a change in good's price
change in supply - ANSWERS SHIFT of supply curve cause by a change in a
determinant of supply other than price
market equilibrium - ANSWERS point where quantity demanded by consumers
exactly equals quantity supplied by producers
CORRECT ANSWERS WITH COMPLETE
SOLUTION | NEW 2026 UPDATE
4 key assumptions of the economic model - ANSWERS oSupply and Demand in
a single market
oAll goods in the market are identical
oAll goods sold in the market sell for the same price, and everyone has the same
info
oThere are many producers and consumers
supply - ANSWERS the combined amount of a good that all producers in a
market are willing to sell
demand - ANSWERS combined amount of a good that all consumers in a
market are willing to buy
commodities - ANSWERS products traded in markets in which consumers view
different varieties of the good as essentially interchangeable
factors that influence demand - ANSWERS price
number of consumers
wealth/ consumer income
tastes/preferences
,prices of other goods
substitutes - ANSWERS good that can be used IN PLACE of another good
complements - ANSWERS good that is purchased and used IN COMBINATION
with another good
demand curve - ANSWERS relationship b/w quantity of a good that consumers
demand and the goods price
demand choke price - ANSWERS price at which no consumer is willing to buy a
good
quantity demand is ZERO
vertical intercept of inverse demand curve
inverse demand curve - ANSWERS demand curve written in the form of price
as a function of quantity demanded
change in quantity demanded - ANSWERS movement ALONG demand curve
result of change in goods price
change in demand - ANSWERS SHIFT of demand curve
result of change in a determinant of demand other than the goods price
Determinants of Supply - ANSWERS price
, suppliers cost of production
# of sellers
sellers outside options
production technology - ANSWERS the processes used to make, distribute,
and sell a good
supply curves - ANSWERS graph relationship b/w quantity supplied of a good
and the good's price
supply choke price - ANSWERS price at with no firms is willing to produce a
good
quantity supplied is ZERO
vertical intercept of inverse supply curve
inverse supply curve - ANSWERS supply curve written in the form of price as a
function of quantity supplied
changes in quantity supplied - ANSWERS movement ALONG supply curve that
occurs as a result of a change in good's price
change in supply - ANSWERS SHIFT of supply curve cause by a change in a
determinant of supply other than price
market equilibrium - ANSWERS point where quantity demanded by consumers
exactly equals quantity supplied by producers
