A reduction in production costs typically leads to an increase in supply, as producers can produce more at lower costs.

If the price of a substitute good increases, consumers will likely buy more of the original good, increasing its demand.

If supply decreases while demand remains constant, there will be a shortage, leading to an increase in the equilibrium price.

In the case of a surplus, suppliers will lower the price to encourage more sales, leading to a decrease in price.

A rightward shift in the demand curve indicates an increase in demand at all price levels.

An increase in consumer preferences for a product typically leads to an increase in demand for that product.

When the price of a product decreases, consumers are generally more willing to buy more of it, leading to an increase in demand.

Market equilibrium occurs when the quantity supplied equals the quantity demanded at a certain price.

The law of supply states that there is a direct relationship between price and quantity supplied; as price increases, quantity supplied also increases.

Microeconomics primarily focuses on individual markets and the behavior of consumers and firms within those markets.

Perfect competition is characterized by many buyers and many sellers in the market.

A shortage occurs when the quantity demanded exceeds the quantity supplied at a given price.

The point where the supply and demand curves intersect is called the equilibrium, where quantity supplied equals quantity demanded.

A change in consumer income can lead to a shift in the demand curve, as higher income typically increases demand for normal goods.

Consumer income is a determinant of demand, not supply.