Econ 202 Chapter 4 Quizzes

| Taco | | WILL |\ | \ | \ | \ |_______\______________________ Ench Tacos Enchiladas Bree 12 6 Will 4 6 16 12 What is the slope of the line?

-4/6

Suppose a 4 percent increase in price results in a 2 percent increase in the quantity supplied of a good. Calculate the price elasticity of supply and characterize the product. - 2; The product is elastic. - 0.5; The product is inelastic. - 0.2; The product is inelastic. - 50%; The product is inelastic.

0.5; The product is inelastic.

Suppose that the price of a money clip increases from $0.75 to $0.90 and quantity supplied rises from 8,000 units to 10,000 units. Use the midpoint formula to calculate the price elasticity of supply.

1.22

Apples Cherries Taylor 8 2 Jeff 6 3 14 5 The opportunity cost for Jeff to pick a bushel of apples is

1/2

Shirts Pants Dylan 12 9 Justin 4 8 TOTAL 16 17 The opportunity cost for Justin to make a pair of pants is

1/2

Tacos Enchiladas Bree 12 6 Will 4 16 16 22 The opportunity cost for Bree to make a taco is

1/2

Serena Haley Bracelets 8 9 Necklaces 16 12 What is Haley's opportunity cost of making a bracelet?

12/9 of a necklace

The price elasticity of supply for umbrellas is 2. Suppose you're told that following a price increase, quantity supplied increased by 30 percent. What was the percentage change in price that brought this about? - 6.7 percent - 60 percent - 15 percent - impossible to determine without additional information

15 percent

Serena Haley Bracelets 8 9 Necklaces 16 12 What is Haley's opportunity cost of making a necklace?

9/12 of a bracelet

An increase in the price of pineapples will result in - a decrease in the demand for pineapples. - a larger quantity of pineapples supplied. - an increase in the supply of pineapples. - a smaller quantity of pineapples supplied.

a larger quantity of pineapples supplied.

If opportunity costs are constant, the production possibilities frontier would be graphed as: - a ray from the origin. - a negatively sloped curve bowed in toward the origin. - a negatively sloped straight line. - a positively sloped straight line.

a negatively sloped straight line

A decrease in the price of GPS systems will result in - a decrease in the demand for GPS systems. - a larger quantity of GPS systems supplied. - a smaller quantity of GPS systems supplied. - an increase in the supply of GPS systems.

a smaller quantity of GPS systems supplied.

Which of the following would cause a decrease in the supply of milk? - a decrease in the price of milk - an increase the price of a product that producers sell instead of milk - an increase in the number of firms that produce milk - an increase in the price of cookies (assuming that milk and cookies are complements)

an increase the price of a product that producers sell instead of milk

Which of the following is a product innovation? - self check-out lines - assembly lines - antibiotics - Kyle Field

antibiotics

Comparative advantage means the ability to produce a good or service - of a higher quality than any other producer. - at a lower opportunity cost than any other producer. - at a higher profit level than any other producer. - at a lower selling price than any other producer.

at a lower opportunity cost than any other producer

You have an absolute advantage whenever you - prefer to do one particular activity. - can produce more of something than others with the same resources. - can produce something at a lower opportunity cost than others. - are better educated than someone else.

can produce more of something than others with the same resources.

An outward shift of a nation's production possibilities frontier represents: - rising prices of the two goods on the production possibilities frontier model. - a situation in which a country produces more of one good and less of another. - economic growth. - an impossible situation

economic growth.

A supply schedule - is a table that shows the relationship between the price of a product and the quantity of the product that producers and consumers are willing to exchange. - is the relationship between the supply of a product and the cost of producing the product. - is a table that shows the relationship between the price of a product and the quantity of the product supplied. - is a curve that shows the relationship between the price of a product and the quantity of the product supplied.

is a table that shows the relationship between the price of a product and the quantity of the product supplied.

A movement from Y to Z (Shows PPF moving out completely rightward) - is the result of a decrease in preference for food products. - is the result of advancements in plastic production technology. - is the result of advancements in food production technology. - represents an increase in the demand for plastic products.

is the result of advancements in plastic production technology.

The production possibilities frontier shows the ________ combinations of two products that can be produced in a particular time period with available resources. - only - maximum attainable - minimum attainable - equitable

maximum attainable

The price elasticity of an upward-sloping supply curve is always: - positive. - greater than one. - negative. - impossible to determine.

positive

Which of the following is a process innovation? - airports - self checkout lines - smartphones - Lasik eye surgery

self checkout lines

Economic decline (negative growth) is represented on a production possibilities frontier model by the production possibility frontier - shifting outward. - becoming flatter. - shifting inward. - becoming steeper.

shifting inward

The supply curve for watches - shows the relationship between the quantity of watches firms are willing and able to supply and the quantity of watches consumers are willing and able to purchase. - shows the supply of watches consumers are willing and able to buy at any given price. - is downward sloping. - shows the relationship between the price of watches and the quantity of watches supplied.

shows the relationship between the price of watches and the quantity of watches supplied.

Over longer periods of time, increases in oil prices provide firms with incentives to explore and recover oil. What does this indicate about the long-run price elasticity of supply for oil? - The elasticity coefficient approaches 0 in the long run as supplies are depleted. - The elasticity coefficient is likely to be higher in the long run than in the short run. - The elasticity coefficient is likely to be lower in the long run than in the short run. - The elasticity coefficient is unstable in the long run because oil supplies may be depleted.

The elasticity coefficient is likely to be higher in the long run than in the short run.

An increase in the quantity of a product supplied is caused by an increase in the price of the product. - True - False

True

Quantity supplied refers to the amount of a good or service that a firm is willing and able to supply at a given price. - True - False

True

All else equal, as the price of a product falls, the quantity supplied increases. - True - False

False

WHAT SHOULD YOU DO FOR GRAPHS?

GO LOOK AT QUIZ 4.5, 4.6,4.7,4.8 ANSWERS

Suppose the value of the price elasticity of supply is 4. What does this mean? - A 4 percent increase in the price of the good causes quantity supplied to increase by 1 percent. - A 1 percent increase in the price of the good causes the supply curve to shift upward by 4 percent. - A 1 percent increase in the price of the good causes quantity supplied to increase by 4 percent. - For every $1 increase in price, quantity supplied increases by 4 units.

A 1 percent increase in the price of the good causes quantity supplied to increase by 4 percent.

Why has the number of people living on farms gone down so drastically from 1900? - Process innovations such as herd immunization - Process innovations such as mechanized planting and harvesting - All of these - Investment in capital such as tractors

All of these

What is the difference between an "increase in supply" and an "increase in quantity supplied"? - An "increase in supply" means the supply curve has shifted to the right while an "increase in quantity supplied" means at any given price supply has increased. - An "increase in supply" means the supply curve has shifted to the right while an "increase in quantity supplied" refers to a movement along a given supply curve in response to an increase in price. - There is no difference between the two terms; they both refer to a shift of the supply curve. - There is no difference between the two terms; they both refer to a movement along a given supply curve.

An "increase in supply" means the supply curve has shifted to the right while an "increase in quantity supplied" refers to a movement along a given supply curve in response to an increase in price.

Serena Haley Bracelets 8 9 Necklaces 16 12 Which of the following statements is true? - Haley has an absolute advantage in making bracelets and Serena in making necklaces. - Haley has an absolute advantage in making both products. - Haley has an absolute advantage in making necklaces and Serena in making bracelets. - Serena has an absolute advantage in making both products

Haley has an absolute advantage in making bracelets and Serena in making necklaces.

Which of the following is an example of capital? - smartphones - self checkout lines - Washington, D.C. - Kyle Field

Kyle Field

Assembly lines are an example of: - Process innovation - Product innovation - Capital investment - All of these

Process innovation

In October 2005, the U.S. Fish and Wildlife Service banned the importation of beluga caviar, the most prized of caviars, from the Caspian Sea. What happened in the market for caviar in the United States? - The supply curve shifted to the left. - The demand curve shifted to the right. - The demand curve shifted to the left. - The supply curve shifted to the right.

The supply curve shifted to the left.

In February, market analysts predict that the price of titanium will rise in March. What happens in the titanium market in February, holding everything else constant? - The supply curve shifts to the left. - The demand curve shifts to the left. - The supply curve shifts to the right. - The quantity of titanium demanded and the quantity of titanium supplied both increase.

The supply curve shifts to the left.

In October, market analysts predict that the price of platinum will fall in November. What happens in the platinum market in October, holding everything else constant? - The supply curve shifts to the left. - The quantity of platinum demanded and the quantity of platinum supplied both increase. - The demand curve shifts to the right. - The supply curve shifts to the right.

The supply curve shifts to the right.

If the United States placed an embargo on Swedish products, what would happen in the U.S. market for Swedish furniture? - The demand curve would shift to the right. - The demand curve would shift to the left. - The supply curve would shift to the left. - The supply curve would shift to the right.

The supply curve would shift to the left.

Danielle Ocean pays for monthly pool maintenance for her home swimming pool. Last week the owner of the pool service informed Danielle that he will have to raise his monthly service fee because of increases in the price of pool chemicals. How is the market for pool maintenance services affected by this? - There is an increase in the supply of pool maintenance services. - There is a decrease in the supply of pool maintenance services. - There is a decrease in the demand for pool maintenance services. - There is a decrease in the quantity of pool maintenance services supplied.

There is a decrease in the supply of pool maintenance services.

Shirts Pants Dylan 12 9 Justin 4 8 TOTAL 16 17 Dylan has a: - a comparative advantage and an absolute advantage in making shirts. - a comparative advantage but not an absolute advantage in making shirts. - a comparative advantage and an absolute advantage in making pants. - a comparative advantage but not an absolute advantage in making pants. - none of these.

a comparative advantage and an absolute advantage in making shirts.

Tacos Enchiladas Bree 12 6 Will 4 16 16 22 Bree has: - a comparative advantage and an absolute advantage in making tacos. - a comparative advantage but not an absolute advantage in making tacos. - a comparative advantage and an absolute advantage in making enchiladas. - a comparative advantage but not an abolute advantage in making enchiladas. - none of these.

a comparative advantage and an absolute advantage in making tacos.

Apples Cherries Taylor 8 2 Jeff 6 3 14 5 Jeff Has: - a comparative advantage and an absolute advantage in picking cherries. - a comparative advantage but not an absolute advantage in picking cherries. - a comparative advantage and an absolute advantage in picking apples. - a comparative advantage but not an absolute advantage in picking apples. - none of these.

a comparative advantage and an absolute advantage in picking cherries.

Shirts Pants Dylan 12 9 Justin 4 8 TOTAL 16 17 Justin has a: - a comparative advantage and an absolute advantage in making shirts. - a comparative advantage but not an absolute advantage in making shirts. - a comparative advantage and an absolute advantage in making pants. - a comparative advantage but not an absolute advantage in making pants. - none of these.

a comparative advantage but not an absolute advantage in making pants.

Last year, the Pottery Palace supplied 8,000 ceramic pots at $40 each. This year, the company supplied the same quantity of ceramic pots at $55 each. Based on this evidence, The Pottery Palace has experienced - a decrease in supply. - an increase in the quantity supplied. - an increase in supply. - a decrease in the quantity supplied.

a decrease in supply.

Ranchers can raise either cattle or sheep on their land. Which of the following would cause the supply of sheep to increase? - an increase in the price of sheep - a decrease in the price of cattle - an increase in the price of sheep feed - an increase in the demand for cattle

a decrease in the price of cattle

An increase in the price of off-road vehicles will result in - a larger quantity of off-road vehicles supplied. - an increase in the demand for off-road vehicles. - a decrease in the supply of off-road vehicles. - a smaller quantity of off-road vehicles supplied.

a larger quantity of off-road vehicles supplied.

The price elasticity of supply is equal to: - the change in quantity supplied divided by the change in price. - the percentage change in price divided by the percentage change in quantity supplied. - the percentage change in quantity supplied divided by the percentage change in price. - the value of the slope of the supply curve.

the percentage change in quantity supplied divided by the percentage change in price.

One would speak of a change in the quantity of a good supplied, rather than a change in supply, if - the cost of producing the good changes. - prices of substitutes in production change. - supplier expectations about future prices change. - the price of the good changes.

the price of the good changes

Tacos Enchiladas Bree 12 6 Will 4 16 16 22 The producer with the least opportunity cost of making a taco is: - the producer who gives up the fewest enchiladas to make a taco. - the producer who can make the most enchiladas per taco given up. - the producer who can make the most tacos. - the producer who can make the fewest enchiladas. - the producer who can make the most enchiladas per taco given up AND the producer who can make the most tacos.

the producer who gives up the fewest enchiladas to make a taco.

Shirts Pants Dylan 12 9 Justin 4 8 TOTAL 16 17 The producer with the least opportunity cost of making a shirt is: - the producer who gives up the fewest pants to make a shirt. - the producer who can make the most pants per shirt given up. - the producer who can make the most shirts. - the producer who can make the fewest pants. - the producer who can make the most pants per shirt given up AND the producer who can make the most shirts.

the producer who gives up the fewest pants to make a shirt.

If, in the market for oranges, the supply has increased then - there has been a movement downwards along the supply curve for oranges. - there has been a movement upwards along the supply curve for oranges. - the supply curve for oranges has shifted to the left. - the supply curve for oranges has shifted to the right

the supply curve for oranges has shifted to the right

If in the market for peaches the supply curve has shifted to the left, - the quantity of peaches supplied has increased. - the supply of peaches has increased. - the quantity of peaches supplied has decreased. - the supply of peaches has decreased.

the supply of peaches has decreased.