Exam 1 review microeconomics

A

A change in all of the following variables will change the market demand for a product except A - the price of the product. B - tastes C - income D - population of demographics

C

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

B

Buyers rush to purchase stocks in California vineyards following a forecast of a 30 percent decline in this year's grape harvest. What happens in the California wine market as a result of this announcement? A - The supply curve for California wine shifts to the right in anticipation of higher prices in the future. B - The demand curve for California wine shifts to the right in anticipation of higher prices in the future. C - The demand curve for California wine shifts to the left in anticipation of higher prices in the future. D - The supply curve for California wine shifts to the left in anticipation of lower quantities in the future.

C

By drawing a demand curve with ________ on the vertical axis and ________ on the horizontal axis, economists assume that the most important determinant of the demand for a good is the ________ of the good. A - price; quantity; quantity B - quantity; price; price C - price; quantity; price D - quantity; price quantity

B

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? A - There is a decrease in the quantity of pool maintenance services supplied. B - There is a decrease in the supply of pool maintenance services. C - There is a decrease in the demand for pool maintenance services. D - There is an increase in the supply of pool maintenance services.

A

Economics is primarily the study of? A - how agents choose to allocate scare resources and how the choices affect society B - the state, nation, government and politics and policies of governments C - the problem related to existence and evolution of society D - the mental functions and behavior of individuals and groups

A

Elvira decreased her consumption of bananas when the price of peanut butter increased. For Elvira, peanut butter and bananas are A - complements in consumption. B - both inferior goods. C - both luxury goods. D - substitutes in consumption.

B

Figure 4-8 shows the market for beer. The government plans to impose a unit tax in this market. Refer to Figure 4-8. As a result of the tax, is there a loss in consumer surplus? A - No, because consumers are charged a lower price to cover their tax burden. B - Yes, because consumers paying a price above the economically efficient price. C - No, because the market reaches a new equilibrium D - No, because the producer pays the tax.

A

Figure 4-8 shows the market for beer. The government plans to impose a unit tax in this market. Refer to Figure 4-8. For each unit sold, the price sellers receive after the tax (net of tax) is A - $20. B - $22. C - $27. D - $32.

A

Figure 4-8 shows the market for beer. The government plans to impose a unit tax in this market. Refer to Figure 4-8. How much of the tax is paid by producers? A - $2 B -$5 C - $7 D -$12

D

Figure 4-8 shows the market for beer. The government plans to impose a unit tax in this market. Refer to Figure 4-8. The price buyers pay after the tax is A - $7. B - $20. C - $22. D - $27.

C

Figure 4-8 shows the market for beer. The government plans to impose a unit tax in this market. Refer to Figure 4-8. What is the size of the unit tax? A - $2 B - $5 C - $7 D - $12

B

Figure 4-8 shows the market for beer. The government plans to impose a unit tax in this market. Refer to Figure 4-8.How much of the tax is paid by buyers? A - $2 B - $5 C - $7 D - $12

C

Holding everything else constant, an increase in the price of MP3 players will result in A - an increase in the supply of MP3 players B - a decrease in the quantity of MP3 players supplied. C - a decrease in the quantity of MP3 players demanded. D - a decrease in the demand for MP3 players.

B

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

A

If the Apply iPad and the Samsung Galaxy Tab are considered subsitutes, then, other things equal an increase in the price of the iPad will A - increase the demand for the Galaxy Tan B - increase the quantity demanded for the Galaxy tab C - decrease the demanded for the iPad D - increase the quantity demanded for the iPad

B

If the percentage increase in price is 15 percent and the value of the price elasticity of demand is -3, then quantity demanded A - will increase by 45 percent. B - will decrease by 45 percent. C - will increase by 5 percent. D - will decrease by 5 percent.

C

If the price of automobiles was to increase, then A - the quantity demanded of gasoline would decrease. B - the demand for gasoline would increase. C - the demand for gasoline would decrease. D - the supply of gasoline would increase.

B

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 U.S.? A - The supply curve shifted to the right. B - The supply curve shifted to the left. C - The demand curve shifted to the right. D - The demand curve shifted to the left.

D

Lydia runs a small nail salon in the town of New Hope. She is debating whether she should extend her hours of operation. Lydia figures that her sales revenue will depend on the number of hours the nail salon is open as shown in the table above. She would have to hire a worker for those hours at a wage rate of $10 per hour Refer to Table 1-1. Using marginal analysis, determine how many hours should Lydia extend her nail salon's hours of operations? A - 2 hours B - 3 hours C - 4 hours D - 5 hours

A

Lydia runs a small nail salon in the town of New Hope. She is debating whether she should extend her hours of operation. Lydia figures that her sales revenue will depend on the number of hours the nail salon is open as shown in the table above. She would have to hire a worker for those hours at a wage rate of $10 per hour. Refer to Table 1-1. What is Lydia's marginal benefit if she decides to stay open for two hours instead of one hour? A - $25 B - $50 C - $75 D - $125

A

Lydia runs a small nail salon in the town of New Hope. She is debating whether she should extend her hours of operation. Lydia figures that her sales revenue will depend on the number of hours the nail salon is open as shown in the table above. She would have to hire a worker for those hours at a wage rate of $10 per hour. Refer to Table 1-1. What is Lydia's marginal cost if she decides to stay open for two hours instead of one hour? A - $10 B - $20 C - $25 D - $40

A

Marcoeconmics is the study of? A - the economy as a whole B - how households and firms make choices C - how firms make choices D - how. households make choices

D

Refer to Figure 2-1. Point A is A - technically efficient. B - unattainable with current resources. C - the equilibrium output combination. D - inefficient in that not all resources are being use

B

Refer to Figure 2-1. Point B is A - inefficient in that not all resources are being used. B - technically efficient. C - unattainable with current resources. D - the equilibrium output combination.

A

Refer to Figure 3-1. A decrease in taste or preference would be represented by a movement from A - D2 to D1. B - D1 to D2. C -A to B. D - B to A.

A

Refer to Figure 3-1. A decrease in the price of the product would be represented by a movement from A - A to B. B - D2 to D1. C - D1 to D2. D - B to A.

A

Refer to Figure 3-1. An increase in population would be represented by a movement from A - D1 to D2. B - B to A. C - A to B. D - D2 to D1.

B

Refer to Figure 3-1. If the product represented is an inferior good, an increase in income would be represented by a movement from A - D1 to D2. B - D2 to D1. C -B to A. D - A to B.

A

Refer to Figure 3-4. At a price of $10, how many units will be sold? A - 200 B - 400 C - 600 D - 800

B

Refer to Figure 3-4. If the current market price is $10, the market will achieve equilibrium by A - a price increase, increasing the supply and decreasing the demand. B - a price increase, increasing the quantity supplied and decreasing the quantity demanded. C - a price decrease, decreasing the quantity supplied and increasing the quantity demanded. D - a price decrease, decreasing the supply and increasing the demand.

B

Refer to Figure 3-4. If the price is $10, A - there would be a surplus of 200 units. B - there would be a shortage of 600 units. C - there would be a shortage of 200 units. D - there would be a surplus of 600 units.

A

Refer to Figure 3-7. Assume that the graphs in this figure represent the demand and supply curves for almonds. Which panel best describes what happens in this market when there is an increase in the productivity of almond harvesters? A - Panel (a) B - Panel (b) C - Panel (c) D - Panel (d)

D

Refer to Figure 3-7. Assume that the graphs in this figure represent the demand and supply curves for bicycle helmets. Which panel best describes what happens in this market if there is a substantial increase in the price of bicycles? A - Panel (a) B - Panel (b) C - Panel (c) D - Panel (d)

C

Refer to Figure 3-7. Assume that the graphs in this figure represent the demand and supply curves for used clothing, an inferior good. Which panel describes what happens in this market as a result of a decrease in income? A -Panel (a) B - Panel (b) C - Panel (c) D -Panel (d)

B

Refer to Figure 3-7. Assume that the graphs in this figure represent the demand and supply curves for women's clothing. Which panel best describes what happens in this market when the wages of seamstresses rise? A - Panel (a) B - Panel (b) C - Panel (c) D - Panel (d)

C

Suppose a hurricane decreased the supply of oranges so that the price of oranges rose from $120 a ton to $180 a ton and quantity sold decreased from 800 tons to 240 tons. What is the absolute value of the price elasticity of demand? A - 9.33 B - 0.74 C - 1.40 D - 0.11

C

The Law of Demand states that A - the quantity demanded of a commodity is the same for all consumers in a perfectly competitive market B - the demand for a commodity is mostly influenced by consumers' income C - the quantity demanded of a commodity varies. inversely with the price of the commodity D - the demand for a commodity always equals the supply of the commodity

D

The popularity of digital cameras has enticed large discount stores like Wal-Mart and Costco to offer digital photo printing services. How does this affect the digital photo printing market? A - The demand curve for digital photo printing services shifts to the left. B - The demand curve for digital photo printing services shifts to the right. C - The supply curve for digital photo printing services shifts to the left. D - The supply curve for digital photo printing services shifts to the right.

D

The relationship between the unemployment rate and inflation is studied under: A - microeconomics B - international economics C - behavioral economics D - macroeconomics

D

Tom Searchinger, a senior attorney at the Environmental Defense Fund, observed that generous farm subsidies have encouraged farmers to produce more corn and more wheat. How does this affect the market for fertilizer? A - The supply of fertilizer increases. B - The supply of fertilizer decreases C - The demand for fertilizer decreases. D - The demand for fertilizer increases.

C

Which of the following best describes scarce resources? A - resources for which the quantity demanded is the same for all economic agents B - Resources that can only be distributed efficiently by the government C - Resources for which the quantity that people want exceeds the quantity that is freely available D - Resources the most people cannot afford to buy

D

Which of the following factors is likely to lead to an increase in the quantity demanded of pens? A - A fall in the incomes of all consumer B - A rise in the incomes of all consumers C - A fall in price of paper D - A fall in price of pens

C

Which of the following is NOT a scarce resource? A - Petroleum B - Gold C - Pollution D - iPhones

B

Which the following pairs fo goods are likely to be considered substitutes A - Coffee and sugar B - A ford car and public transportation C - A Nokia cell phone and a Nokia cell phone charger D - Printers and printing ink