Econ 201 Ch 4 Practice quiz

fall, due to a rise in supply.

As a result of technological innovation, automated water pumps are being installed on the farms of Kenyan tomato farmers. As a result of the increased use of automated water pumps, the equilibrium price of tomatoes will: fall, due to a rise in supply. rise, due to a rise in demand. rise, due to a fall in supply. fall, due to a fall in demand.

You can charge a higher price per pumpkin.

Suppose that you have a pumpkin stall at a farmer's market, and the Halloween season arrives. You know that your customers will want to buy many pumpkins to decorate their houses and make pumpkin pies. Which of the following is a likely result of this scenario? You can charge a higher price per pumpkin. You will wind up with many unsold pumpkins. You will be able to sell only the highest-quality pumpkins. You will take fewer pumpkins to the market to sell.

(i), (ii), and (iv)

Which of the following five scenarios illustrate markets in action? (i) You rent a book at the university bookstore. (ii) You bargain at a street stall.(iii) You mow your own lawn.(iv) You get a manicure at a nail salon. (v) You grow your own vegetables and consume them yourself. (i), (ii), and (iii) (i), (ii), and (iv) (i), (iii), and (v) (iii) and (v)

there was a surplus of the product in the store.

If a store runs a sale on a product to clear out its stock, we can conclude that: there was a surplus of the product in the store. the product must be very close to its expiration date. the demand for the product is larger than the supply of the product. there was a shortage of the product in the store.

a market in action.

A seller at a farmer's market wants $10 for a bag of 10 apples. You think his price is too high, so you counter with an offer of $6 for the bag. The seller then offers you a much smaller bag of five apples for $6. You bargain again, and the seller lets you buy the 10 apples for $8. This scenario is an example of: a shortage. a centrally planned market. perfect competition. a market in action.

quantity corresponding to the intersection of the demand and supply curves.

Graphically, the equilibrium quantity can be identified as the: maximum quantity that buyers are willing to buy. maximum quantity that sellers are willing to sell. quantity corresponding to the intersection of the demand and supply curves. quantity corresponding to the intersection of the demand curve and the price axis.

(i), (ii), and (iii)

The United Kingdom plans to end the use of gas-powered and diesel-powered cars by the year 2040. At the same time, car manufacturers, such as General Motors and Nissan, are increasing the number of electric car models they produce. Based on this information, which of the following statements is/are correct? (i) If the supply of new electric cars is greater than the demand for new electric cars, then the price of electric cars will fall in the future. (ii) The demand for gasoline will fall in the future. (iii) The demand for electricity will rise in the future. (iv) The demand for diesel will rise in the future. (ii) and (iv) only (i) (i), (ii), and (iii) (i) and (ii)

300 units

Use the table to answer the question.What is the equilibrium quantity in this market? 330 units 100 units 300 units 240 units

demand for skills education increases.

When there is a shortage of highly skilled workers in a particular region, the: demand for skills education increases. demand for skills education decreases. demand for highly skilled workers increases. supply of jobs for highly skilled workers increases.

quantity demanded exceeds quantity supplied.

A shortage occurs when: quantity demanded exceeds quantity supplied. when there is insufficient demand. quantity supplied exceeds quantity demanded. there is excess production.

at prices below the equilibrium price.

Graphically, shortages will always occur: at prices above the equilibrium price. at the equilibrium price. when the quantity supplied exceeds the quantity demanded. at prices below the equilibrium price.

technological advance in production techniques

Use the figure to answer the question. Which of the following events would lead to a shift of the supply curve from Old supply to New supply? technological advance in production techniques a natural disaster that causes a shutdown of production a decrease in the size of the market increased taxation of raw materials used by producers

$9

Use the table to answer the question.What is the equilibrium price in this market? $11 $3 $7 $9

when the quantity supplied equals the quantity demanded.

An equilibrium in a market occurs: when the quantity supplied equals the quantity demanded. when suppliers have sold all the goods and services that they have produced. at the halfway point on the price axis. at the halfway point on a demand curve.

determined by the intersection of the demand and supply curves.

An equilibrium price is: determined by the intersection of the demand and supply curves. the price that prevails when quantity supplied is less than quantity demanded. the price that prevails when there is a shortage. the price that occurs when there is a surplus.

highly skilled workers can negotiate higher salaries.

When there is a shortage of highly skilled workers in a particular region: the incomes of highly skilled workers fall. there is a corresponding surplus of low-skilled workers in the region. unemployment rises among highly skilled workers. highly skilled workers can negotiate higher salaries.

The supply of cacao beans, used to produce chocolate, has fallen around the world.

You eat M&Ms every day. When you go to the store to buy some, you find that M&Ms are more expensive than they were last month. Which of the following could explain why M&Ms are more expensive? A new study finds that the benefits of eating chocolate are not as great as previously thought. Consumers are now purchasing fewer M&Ms compared to other types of chocolates. The supply of cacao beans, used to produce chocolate, has fallen around the world. A new robot has been installed at the Mars chocolate company that reduces the time needed to produce M&Ms by half.

There is a shortage of the item.

You're shopping online, and you place an item in your virtual cart. Two days later, you return to the virtual cart to check out and find that the item is now more expensive. Assuming that the market is competitive, what could explain the price increase? There is a surplus of the item. There is a shortage of the item. New sellers are offering the same product. There is decreased demand for the item.