1. In the model of perfect competition:
the price is determined by how many years are left in the product’s
patent.
B no individual or firm has enough power to have any impact on price.
A
. .
C
. the consumer is at the mercy of powerful firms that can set prices
wherever they prefer.
D individual firms can influence the price, but only slightly.
. 1 points 1. QUESTION 2 A good is normal if which of the following is true? A
.
B
. When income increases, the demand increases. When income increases, the demand remains
unchanged.
C Income and the demand are unrelated.
.
D When
. income increases, the demand decreases.
1 points QUESTION 3 1. The law of demand states that other things equal:
as the price decreases, the demand curve will shift
to the right.
B as the price increases, the demand will decrease.
A
. .
C
. as the price increases, the quantity demanded will
increase.
D as the price increases, the quantity demanded will
.
decrease.
1 points 1. QUESTION 4 Which of the following examples illustrates the law of demand? A
.
B
.
C
. Fewer people play golf because incomes are lower.
Oil companies drill for new sources of oil because oil prices are higher. An increase in tuition encourages more students to enroll in college
because the quality of education has risen.
D Consumers buy more personal computers because prices have fallen.
. 1 points QUESTION 5 1. Which of the following factors would cause a movement along the
demand curve for a particular good?
A
.
B
. a change in the prices of related goods both a change in the price of that good and a change in the size of
the population
C a change in the size of the population
.
Da
. change in the price of that good
1 points 1. QUESTION 6 If the demand for tires goes down when the price of gas goes up, then
tires and gas are:
A
.
B
. complements. both
expensive.
C substitutes.
.
D both
. inexpensive.
1 points QUESTION 7 1. A college student is faced with a difficult decision of how to spend one
hour tonight. She could babysit her professor’s child at an hourly wage of $7,
she could work at the college library at a wage of $6, or she could finish her
economics homework assignment. If she chooses to complete her homework
assignment, she has incurred an opportunity cost equal to:
A
.
B
. $0. $1
3.
C $6.
.
D $7.
.
1 points 1. QUESTION 8 The typical supply curve illustrates that: A
. other things equal, the supply of the good creates its own demand for
the good.
B other things equal, the quantity supplied for a good is inversely related
.
to the price of a good.
C other things equal, the quantity supplied for a good is positively related to the price of a good.
D price and quantity supplied are unrelated.
.
. 1 points 1. QUESTION 9 A shift to the left of a supply curve is caused by: A
. a technological improvement in
production.
B an increase in the cost of an input.
.
C an
.
D an
. increase in the number of buyers.
increase in the number of sellers.
1 points QUESTION 10 1. The market equilibrium is found at the:
price where quantity demanded equals quantity
supplied.
B highest price the market will bear.
A
. .
C
. price where quantity supplied exceeds quantity
demanded.
D price where quantity demanded exceeds quantity
.
supplied.
1 points 1. QUESTION 11 Figure: Demand and Supply of Gasoline Reference: Ref 3-7 (Figure: Demand and Supply of Gasoline) Look at the figure Demand and
Supply of Gasoline. The initial equilibrium price and quantity (at intersection
of S1 and D) of gasoline are:
A $1.50 and 400
.
gallons.
B $2.00 and 450
.
gallons.
C $2.50 and 300
.
gallons.
D $2.00 and 200
.
gallons.
1 points QUESTION 12 1. Figure: Demand and Supply of Gasoline Reference: Ref 3-7 (Figure: Demand and Supply of Gasoline) Look at the figure Demand and
Supply of Gasoline. A factor that may have changed supply from S1 to S2 is:
A increased demand.
.
B
. better technology in the production of
gasoline.
C lower labor productivity in gasoline
.
production.
D increased prices of substitutes for
.
gasoline. 1 points QUESTION 13 1. Figure: Demand and Supply of Gasoline Reference: Ref 3-7 (Figure: Demand and Supply of Gasoline) Look at the figure Demand and
Supply of Gasoline. Given the equilibrium after a change in supply
from S1 to S2:
A the new quantity will be 600.
.
B the price will remain constant.
.
C the new price will be $2.00.
.
D at the old price of $2.50, there
. will be pressure for the price to fall. 1 points QUESTION 14 1. Figure: Demand and Supply of Gasoline Reference: Ref 3-7 (Figure: Demand and Supply of Gasoline) Look at the figure Demand and
Supply of Gasoline. When the supply curve shifted from the initial
equilibrium, the new intersection of supply and demand has a price of
________ and quantity of 400. This supply shift could have resulted from
________.
$1.50; an increase
technology
B $2.00; an increase
.
income
C $1.50; an increase
.
income
D $2.00; an increase
.
buyers
A
. in refining
in consumers’
in consumers’
in the number of
1 points QUESTION 15 1. Figure: Demand and Supply of Gasoline Reference: Ref 3-7 (Figure: Demand and Supply of Gasoline) Look at the figure Demand and
Supply of Gasoline. What might cause the supply curve to shift from S2 back
to the initial supply curve S1?
A Technology in the refinement of gasoline greatly improves.
.
B
.
C
. Americans want to buy more gas. The Organization of Petroleum Exporting Countries (OPEC) restricts the
production of crude oil.
D The Organization of Petroleum Exporting Countries (OPEC) increases
.
the production of crude oil.
1 points QUESTION 16 1.
When
LeBron
James
returne
d to the
Clevela
nd
Cavalier
s in
2014,
the price of
tickets
to see
the
Cavalier
s
increas
ed
because
A. their demand curve shifted right. B. their supply curve shifted right. C. their average cost increased. D. their supply curve shifted up.
1 points 1. QUESTION 17 Figure: The Demand and Supply of Wheat Reference: Ref 3-9 (Figure: The Demand and Supply of Wheat) Look at the figure The Demand
and Supply of Wheat. If a price of $10 temporarily exists in this market:
A
. a surplus (excess supply) of 4,000 bushels will
result.
B a shortage (excess demand) of 8,000 bushels
.
will result.
C a surplus (excess supply) of 8,000 bushels will
. result.
D a shortage (excess demand) of 10,000 bushels
.
will result.
1 points 1. QUESTION 18 Figure: The Demand and Supply of Wheat Reference: Ref 3-9 (Figure: The Demand and Supply of Wheat) Look at the figure The Demand
and Supply of Wheat. What is the equilibrium price in this wheat market?
A
. $
8
B$
.
6
C$
.
2
D$
.
4
1 points QUESTION 19 1. Figure: The Demand and Supply of Wheat Reference: Ref 3-9 (Figure: The Demand and Supply of Wheat) Look at the figure The Demand
and Supply of Wheat. If there were an increase in demand of 2,000 bushels
at each price, the equilibrium price and quantity would be ________ and
________ bushels, respectively.
$6;
7,000
B $7;
.
7,000
C $5;
.
5,000
D $8;
.
8,000
A
. 1 points 1. QUESTION 20 Assume that corn is an input in the production of beef but not in the
production of pork. Further, beef and pork are substitutes. A decrease in the
price of corn will:
A
. decrease the supply of beef and decrease the
demand for pork.
B increase the supply of beef and increase the
.
demand for pork.
C increase the supply of beef and decrease the
.
demand for pork. D decrease
. the supply of beef and increase the
demand for pork.
