Econ Quiz 2

As more people migrated West during the gold rush, what happened to the demand curve in most western markets for food and housing, holding all else constant? Select one: a. The demand curve shifted to the right. b. The demand curve shifted to the left. c. There was no shift, but there was an increase in quantity demanded. d. There was no shift, but there was a decrease in quantity demanded. e. There was no shift, and there was no increase or decrease in quantity demanded.

a

Higher input costs Select one: a. reduce profits. b. increase profits. c. shift the demand curve. d. always happen during a recession. e. provide an incentive to hire more workers.

a

Noah walks past the same pharmacy every day. He realizes the pharmacy always changes its prices on Mondays but keeps the price steady for the rest of the week. On Sunday, Noah turns on the news and hears a report projecting that the price of aspirin is going to increase. Holding all else constant, what do you think would happen to Noah's demand for aspirin on Sunday? Select one: a. His demand would shift to the right. b. His demand would shift to the left. c. We would see a movement down his demand curve but no shift. d. We would see a movement up his demand curve but no shift. e. We would see nothing happen to his demand curve until the price changes on Monday.

a

Taxes on producers cause the equilibrium price of a good to Select one: a. increase. b. decrease. c. remain the same. d. go up only for producers. e. go down only for consumers.

a

The government recently imposed a number of regulations on companies that will make it more expensive for companies to hire workers. What consequence will this have on the labor market? Select one: a. These regulations will raise the cost of labor and shift supply to the left. b. These regulations will raise the cost of labor and shift supply to the right. c. These regulations will raise the cost of labor and cause a rightward movement along the supply curve. d. These regulations will raise the cost of labor and cause a leftward movement along the supply curve. e. These regulations will not affect the supply curve.

a

When consumers expect the price for self-driving cars to fall in the future, Select one: a. the demand for self-driving cars decreases. b. the demand for self-driving cars increases. c. the quantity demanded of self-driving cars decreases. d. the quantity demanded of self-driving cars increases. e. both the demand and quantity demanded increase.

a

When firms in a market expect the price of their products to rise, the supply curve of their goods ________, causing the equilibrium price to ________. Select one: a. decreases; rise b. decreases; fall c. increases; fall d. increases; rise e. increases; rise and the equilibrium quantity to fall

a

When supply shifts left and demand shifts right, Select one: a. the equilibrium price always rises. b. the equilibrium price always falls. c. the equilibrium quantity always falls. d. the equilibrium quantity always rises. e. the equilibrium price is indeterminate.

a

When the government places a tax on a good and all else is held constant, which of the following would most likely happen? Select one: a. The overall consumption of the good decreases. b. The price the buyer pays for the good decreases, assuming the good does not have a horizontal demand curve. c. The supply curve shifts to the right. d. The government receives no tax revenue if the tax is more than 20%. e. The price and quantity readjust back to the competitive market equilibrium point where they were at before the imposition of the tax.

a

A change in quantity supplied Select one: a. is represented by a shift in the supply curve. b. is represented by a movement along the supply curve. c. happens only when the price increases. d. happens only when the price decreases. e. is positive if the price of the good decreases.

b

As computing software to automate tasks and calculations has become cheaper, businesses have offered these to employees. What impact would this have on the market for what these businesses sell? Select one: a. The technology will lead to a leftward shift of the supply curve. b. The technology will lead to a rightward shift of the supply curve. c. The technology will lead to a leftward shift of the demand curve. d. The technology will lead to a leftward movement along the supply curve. e. There will be no change in the supply or the quantity supplied.

b

How does the market demand reflect the law of demand? Select one: a. As the price increases, the market quantity demanded increases. b. As the price decreases, the market quantity demanded increases. c. As the price increases, the market quantity demanded increases then decreases. d. As the price decreases, the market quantity demanded decreases then increases. e. The market demand curve does not reflect the law of demand.

b

On January 1, 2019, the government decreased the tax on coal producers from $1.10 per ton to $0.55 per ton. Our model of supply and demand predicts that Select one: a. the demand for coal decreased. b. the supply of coal increased. c. the demand for coal increased. d. the supply of coal decreased. e. both the supply of and demand for coal decreased.

b

Some studies have shown that smelling tulips before playing soccer can increase speed, thereby causing players to score more goals. When these findings were announced, the price and quantity of tulips sold increased in college towns. One reason for these results could have been that the Select one: a. producers increased their supply of tulips. b. consumers increased their demand for tulips. c. producers increased their supply of tulips and consumers increased their demand for tulips. d. producers decreased their supply of tulips. e. consumers decreased their demand for tulips.

b

What would happen in the market for SUVs if the government started to subsidize the production of SUVs that get very few miles per gallon and the price of gasoline went up? Select one: a. The equilibrium price would go up and the equilibrium quantity would go up. b. The equilibrium price would go down and the equilibrium quantity would be indeterminate. c. The equilibrium price would be indeterminate and the equilibrium quantity would go up. d. The equilibrium price would go up and the equilibrium quantity would be indeterminate. e. The equilibrium price would be indeterminate and the equilibrium quantity would go down.

b

What would we expect to happen to the price and quantity of Apple iPhones if the price of Samsung phones increases and Apple develops a new technology that makes its iPhone production process more efficient? Select one: a. The equilibrium price will go up and the equilibrium quantity will go up. b. The equilibrium price will be indeterminate and the equilibrium quantity will go up. c. The equilibrium price will go down and the equilibrium quantity will be indeterminate. d. The equilibrium price will be indeterminate and the equilibrium quantity will go down. e. The equilibrium price will go up and the equilibrium quantity will be indeterminate.

b

When supply shifts right and demand shifts left, Select one: a. the equilibrium price always rises. b. the equilibrium price always falls. c. the equilibrium quantity always falls. d. the equilibrium quantity always rises. e. the equilibrium price is indeterminate.

b

A decrease in demand is represented by a Select one: a. shift of the demand curve to the right. b. movement along the demand curve to the right. c. shift of the demand curve to the left. d. movement along the demand curve to the left. e. shift in the supply curve.

c

A demand schedule Select one: a. is a curve representing the relationship between the price of a good or service and the quantity demanded. b. is a list of goods and services demanded at different prices. c. is a table representing the relationship between the price of a good or service and the quantity demanded. d. can be used only to analyze the individual's demand for a good or service. e. can be used only to analyze the entire market's demand for a good or service.

c

As the life expectancy in the United States increases, which of the following is likely to happen to the demand curve for items such as health care, cancer treatments, and nursing facilities, holding all else constant, and why? Select one: a. There would be a decrease because individuals are healthier. b. There would be an increase because the cost of these items is falling. c. There would be an increase because there will be more buyers in these markets. d. There would be a decrease because Social Security benefits are running out. e. They will stay the same because these changes would affect the supply curve but not the demand curve.

c

During the Industrial Revolution, the invention of the power loom led to more efficient textile production. According to the supply and demand model, when the power loom was invented, if all else was held constant, we would expect the equilibrium price of textiles to ________ and the equilibrium quantity of textiles to ________. Select one: a. increase; increase b. increase; decrease c. decrease; increase d. decrease; decrease e. remain the same; increase

c

If the price and quantity for an inferior good, Good A, is $10 and 4 units at the original equilibrium, what is one possibility for the new equilibrium price and quantity of Good A if we see income increase and all other factors stay constant? Select one: a. $11 and 3 units b. $11 and 7 units c. $8 and 3 units d. $8 and 8 units e. $11 and 2 units

c

If the price of coffee beans were to increase by 120% over the decade and if all else were held constant, what would we expect to happen to the supply curve of coffee lattes? Select one: a. The supply curve would shift to the right. b. The quantity supplied would increase. c. The supply curve would shift to the left. d. The supply curve would shift down. e. Nothing would happen; the cost of coffee has no impact on the supply of coffee lattes.

c

What would happen to the equilibrium price and quantity for the market for alcohol if the government decreased the tax on producers and a scientific study confirmed that drinking alcohol increased the rate of heart disease? Select one: a. The equilibrium price will be indeterminate and the equilibrium quantity will go down. b. The equilibrium price will go up and the equilibrium quantity will go up. c. The equilibrium price will go down and the equilibrium quantity will be indeterminate. d. The equilibrium price will be indeterminate and the equilibrium quantity will go up. e. The equilibrium price will go up and the equilibrium quantity will be indeterminate.

c

An improvement in technology Select one: a. is one way to shift the demand curve. b. always increases producers' profits. c. allows a producer to decrease output with the same amount of input. d. allows a producer to increase output with the same amount of input. e. shifts the supply curve to the left.

d

In one year, 20 golf courses opened on the East Coast. During that same year, CBS started broadcasting professional golf on TV, which sparked more interest in the sport. What would we expect to happen to the price and quantity of a game of golf on the East Coast during that year? Select one: a. The equilibrium price will be indeterminate and the equilibrium quantity will go down. b. The equilibrium price will go up and the equilibrium quantity will go up. c. The equilibrium price will go down and the equilibrium quantity will be indeterminate. d. The equilibrium price will be indeterminate and the equilibrium quantity will go up. e. The equilibrium price will go up and the equilibrium quantity will be indeterminate.

d

When both supply and demand shift to the right, the equilibrium Select one: a. price always rises. b. price always falls. c. quantity always falls. d. quantity always rises. e. quantity is indeterminate.

d

When supply shifts to the right and demand stays constant, the equilibrium price ________ and the equilibrium quantity ________. Select one: a. increases; decreases b. increases; increases c. decreases; decreases d. decreases; increases e. stays the same; increases

d

When the government places a tax on the producer of a good or service Select one: a. the demand curve for the good or service shifts to the right. b. the demand curve for the good or service shifts to the left. c. the supply curve for the good or service shifts to the right. d. the supply curve for the good or service shifts to the left. e. both the supply and demand curves for the good or service shift to the left.

d

Which of the following could describe the behavior of a clothing producer in a perfectly competitive market? Select one: a. The clothing producer uses high-quality material and prices its shirts higher than some other competitors. b. The clothing producer employs several designers to offer styles its competitors do not offer. c. The clothing producer operates in a market where surpluses are common. d. The clothing producer imports its fabrics from another country. e. The clothing producer always prominently displays its unique brand name on its products.

d

Which of the following will cause the demand curve for sunscreen to shift to the right? Select one: a. The price of sunscreen decreases. b. The price of sunscreen increases. c. Cloudy weather is forecast for the next week. d. News media remind people that sunscreen helps ward off skin cancer. e. The price of parking at the beach increases.

d

A technological advancement for Good A will shift the ________ curve of Good A to the ________, making the equilibrium price ________. Select one: a. demand; left; decrease b. supply; right; increase c. demand; right; increase d. supply; left; increase e. supply; right; decrease

e

Alejandra's sister would like to start a business with her brother selling simple black knit hats without logos at all stores in the area. Her brother disagrees and thinks the hats should have a special logo on them and should be sold only at specific stores. As the deciding vote, what should Alejandra choose and why? Select one: a. sell simple black knit hats because prices will be higher as the number of stores increases b. sell simple black knit hats because prices will be higher as the hats become more commonplace c. sell black knit hats with a special logo because prices will be lower as the hats become more unique d. sell black knit hats with a special logo because prices will be lower as the hats are sold in fewer stores e. sell black knit hats with a special logo because prices will be higher as the hats become more unique and are sold in fewer stores

e

Firm A notices that Firm B is making a profit by producing footballs. There is nothing stopping Firm A from entering the football market, so it does. Holding all else constant, the number of firms in the market will Select one: a. increase, causing demand to increase. b. increase, causing the supply to decrease. c. decrease, causing the supply to decrease. d. decrease, causing the supply to increase. e. increase, causing the supply to increase.

e

Inputs are Select one: a. goods that are used together. b. goods that are used in place of one another. c. goods that one demands more of as one's income increases. d. goods that one demands less of as one's income increases. e. resources that firms use in the production of final goods and services.

e

With no barriers to entry or exit and when firms in a market are operating at a loss, we can expect other firms to exit, causing the ________ curve to shift to the ________ and making the equilibrium price ________ and the equilibrium quantity ________. Select one: a. demand; right; increase; increase b. demand; left; decrease; decrease c. supply; right; decrease; increase d. supply; left; increase; increase e. supply; left; increase; decrease

e