Econ 101 - 2nd Exam Study Guide

Hurricane Katrina damaged a large portion of oil refining and pipeline capacity in the Gulf coast states. In the market for gasoline A) The supply curve shifted to the left resulting in an increase in the equilibrium price B) The supply curve shifted to the right resulting in an increase in the equilibrium price C) The demand curve shifted to the left resulting in a decrease in the equilibrium price D) The demand curve shifted to the right resulting in an increase in the equilibrium price

A) The supply curve shifted to the left resulting in an increase in the equilibrium price

In July, market analysts predict that the price of gold will rise in August. What happens in the gold market in July, holding everything else constant? A) The supply curve shifts to the left B) The supply curve shifts to the right C) The quantity demanded and the quantity supplies of gold increase D) The demand curve shifts to the left

A) The supply curve shifts to the left

Which of the following will not shift the demand curve for a good? A) an increase in the price of a good B) an increase in population C) a decrease in the price of a substitute good D) an increase in consumer incomes

A) an increase in the price of a good

The law of demand implies, holding everything else constant, that as the price of yogurt A) increases, the quantity of yogurt demanded will decrease B) increases, the demand for yogurt will increase C) decreases, the quantity of yogurt demanded will decrease D) decreases, the demand for yogurt will increase

A) increases, the quantity of yogurt demanded will decrease

How has the growing popularity of factory outlet stores affected the market for clothing at retail department stores? A) the demand curve for clothing at retail department stores shifts to the left B) the demand curve for clothing at retail department stores shifts to the right C) the supply curve for clothing at retail department stores shifts to the right D) the supply curve for clothing at retail department stores shifts to the left

A) the demand curve for clothing at retail department stores shifts to the left

——— means the supply curve has shifted to the right, while ——— refers to a movement along a given supply curve in response to an increase in price A) An increase in supply; a decrease in supply B) An increase in supply; an increase in quantity supplied C) A decrease in supply; an increase in supply D) A decrease in supply; a decrease in quantity supplies

B) An increase in supply; an increase in quantity supplied

Technological advancements have led to lower prices and an increase in the sale of color laser printers. How does this affect the market for laser printer ink cartridges? A) The demand curve for laser printer ink cartridges shifts to the left B) The demand curve for laser printer ink cartridges shifts to the right C) The quantity of laser printer ink cartridges demanded increases D) The quantity of laser printer ink cartridges demanded decreases

B) The demand curve for laser printer ink cartridges shifts to the right

A demand curve shows the relationship between A) the amount of a product sellers are willing to sell at a particular price and the amount consumers are willing to buy at that price B) the price of a product and the quantity of the product demanded C) the quantity that consumers are willing and able to buy and the quantity that sellers are willing and able to offer D) the price of a produce and the demand for the product

B) The price of a product and the quantity of the product demanded

If, in response to a decrease in the price of coffee, the quantity demanded of coffee increases, economists would describe this as A) an increase in demand B) an increase in quantity demanded C) a change in consumer income D) an increase in consumers' taste for coffee

B) an increase in quantity demanded

Holding everything else constant, a decrease in the price of GPS systems will result in A) a decrease in the quantity of GPS systems demanded B) an increase in the quantity of GPS systems demanded C) an increase in the demand for GPS systems D) a decrease in the supply of GPS systems

B) an increase in the quantity of GPS systems demanded

At a product's equilibrium price A) anyone who needs the product will be able to buy the product, regardless of the ability to pay B) any buyer who is willing and able to pay the price will find a seller for the product C) the federal government will provide the product to anyone who cannot afford it D) not all sellers who are willing to accept the price will find buyer for their products

B) any buyer who is willing and able to pay the price will find a seller for the product

According to a recent study, "Stricter college alcohol policies, such as raising the price of alcohol, or banning alcohol on campus, decrease the number of students who use marijuana." On the basis of this information, how would you describe alcohol and marijuana? A) the two goods are substitutes in consumption B) the two goods are complements in consumption C) there is no relationship between the two goods D) they are both luxury goods

B) the two goods are complements in consumption

In January, buyers of gold expect that the price of gold will fall in February. What happens in the gold market in January, holding everything else constant? A) The demand curve shifts to the right B) The quantity demanded increases C) The demand curve shifts to the left D) The quantity demanded decreases

C) The demand curve shifts to the left

The phrase "demand has increased" means that A) a demand curve has shifted to the left B) there has been an upward movement along a demand curve C) a demand curve has shifted to the right D) there has been a downward movement along a demand curve

C) a demand curve has shifted to the right

If a decrease in income leads to in a decrease in the demand for ice cream, then ice cream is A) a neutral good B) a necessity C) a normal good D) a complement

C) a normal good

If a decrease in income leads to an increase in the demand for macaroni, then macaroni is A) a neutral good B) a necessity C) an inferior good D) a normal good

C) an inferior good

The market for smartphones has become very competitive. The increase in competition in this market is an example of how the market responds to: A) decreases in the price of desktop computers ( a substitute for the product) B) changes in population C) changes in consumer tastes D) increases in income

C) changes in consumer tastes

Suppose that when the price of hamburgers increases, the Ruiz family increases their purchases of hot dogs. To the Ruiz family, A) hamburgers and hot dogs are complements B) hamburgers and hot dogs are inferior goods C) hamburgers and hot dogs are substitutes D) hamburgers and hot dogs are normal goods

C) hamburgers and hot dogs are substitutes

Suppose that when the price of ice cream increases, Liza decreases her purchase of hot fudge. To Liza, A) ice cream is a normal good and hot fudge is an inferior good B) ice cream and hot fudge are substitutes C) ice cream and hot fudge are complements D) ice cream and hot fudge are normal goods

C) ice cream and hot fudge are complements

At market equilibrium, A) surpluses are greater than shortages B) shortages are greater than surpluses C) quantity demanded equals quantity supplied D) demand equals supply

C) quantity demanded equals quantity supplied

Assume that the hourly price for the services of personal trainers has risen and sales of these services have also risen. One can conclude that A) the law of demand has been violated B) the number of personal trainers has increased C) the demand for personal trainers has increased D) personal trainers are deliberately charging high prices because they provide services for wealthy clients

C) the demand for personal trainers has increased

Which of the following is evidence of a shortage of chocolate? A) Firms lower the price of chocolate B) The price of chocolate is raised in order to increase sales C) The equilibrium price of chocolate falls due to a decrease in demand D) The quantity of chocolate demanded is greater than the quantity supplied

D) The quantity of chocolate demanded is greater than the quantity supplied

An ------ is represented by a rightward shift of the demand curve while an ------ is represented by a movement along a given demand curve. A) increase in demand; decrease in demand B) decrease in demand; decrease in quantity demanded C) increase in quantity demanded; increase in demand D) increase in demand; increase in quantity demanded

D) increase in demand; increase in quantity demanded

A supply curve

Is a curve that shows the relationship between the price of a product and the quantity of the product supplied