Supply and Demand

Expanding production to benefit from economies of scale.

Decreasing the price of the product.

Raising the price of the product.

Increasing advertising to make demand more elastic.

Consumers can have all goods and services they desire without trade-offs.

Scarcity applies only to producers, not consumers.

Consumers must make choices based on limited resources.

Government intervention eliminates scarcity for consumers.

Marginal utility

Price elasticity

Opportunity cost

Production possibility curve

The producer has significant market power and can influence market prices easily.

Consumers perceive the good as a necessity with few close substitutes available.

The market structure closely resembles perfect competition with many substitutes available.

The producer operates under highly elastic product demand conditions.

Unitary elastic

Highly elastic

Perfectly inelastic

Relatively inelastic

It can increase social welfare if it leads to output closer to the socially optimal level.

It reduces social welfare by increasing both consumer surpluses at the expense of producer surplus.

It always decreases social welfare due to higher prices for some consumers.

Social welfare remains unaffected as only distribution between producer and consumer surpluses changes.

The demand curve shifts leftward.

The supply curve shifts leftward.

The demand curve shifts rightward.

The supply curve shifts rightward.

Lower production costs.

Increase in demand.

Surplus of goods.

Shortage of goods.

The firm can increase the market price.

The firm becomes a monopolist in the market.

The market price remains unchanged.

Other firms will exit the market due to increased competition.

Gym memberships are normal goods

Gym memberships are inferior goods

Gym memberships are Giffen goods

Gym memberships are substitute goods