Macro econ ch 4 all

Lobsters are plentiful and easy to catch in August but scarce and difficult to catch in November. In​ addition, vacationers shift the demand for lobsters further to the right in August than in any other month. Given this​ information, we know that​ _________ is/are higher in August than in other months. A. both supply and demand. B. only demand. C. neither supply nor demand. D. only supply.

both supply and demand.

The concept of diminishing marginal benefits means that​ __________. A. the more of a good that you​ consume, the lower is your overall benefit from that good. B. each additional unit consumed is worth less to you than the previous one. C. as you consume more of a​ good, your willingness to pay for that good increases faster than the benefit you receive. D. each additional unit consumed is worth more to you than the previous​ one, but the additional benefit grows at a diminishing rate.

each additional unit consumed is worth less to you than the previous one.

Market demand is derived by​ __________. A. dividing each​ buyer's demand by the total number of consumers in the market. B. fixing the quantity and adding up the prices that each buyer pays. C. fixing the price and adding up the quantities that each buyer demands. D. adding up both the prices each buyer pays and the quantities that each buyer demands.

fixing the price and adding up the quantities that each buyer demands.

The concept of diminishing marginal benefits _________ for goods that you like a lot. a. holds true b. does not exist

holds true

The competitive equilibrium price equates A. quantity supplied to quantity demanded. B. supply to demand. C. price to quantity supplied. D. price to quantity demanded.

quantity supplied to quantity demanded.

The market supply curve is the (sum, product) of all the supply curves of potential producers and would be graphed to the (left, right) of the individual curves.

sum, right

Holding all else​ constant, if the number of cell phone manufacturers suddenly decreased due to increased​ regulations, then A. supply would shift​ rightwards, equilibrium price would​ decrease, and equilibrium quantity would increase. B. supply would shift​ rightwards, equilibrium price would​ increase, and equilibrium quantity would decrease. C. supply would shift​ leftwards, equilibrium price would​ increase, and equilibrium quantity would decrease. D. supply would shift​ leftwards, equilibrium price would​ decrease, and equilibrium quantity would decrease.

supply would shift​ leftwards, equilibrium price would​ increase, and equilibrium quantity would decrease.

Suppose you have a flashlight that takes three batteries to power it. If you buy the batteries one at a​ time, for which purchase will diminishing benefits set​ in? A. When you buy the first battery. B. When you buy the second battery. C. When you buy the third battery. D. When you buy the fourth battery.

the forth battery

If the government sets a minimum wage for seasonal workers​, then the supply curve for sparkling wine would​ __________. A. increase (Shift right) B. remain unchanged. c. decrease (shift left)

decrease (shift left)

If the number of sellers of sparkling wine decreases significantly​, then the supply curve for sparkling wine would​ __________. A. increase (shift right) B. decrease (shift left) C. remain unchanged.

decrease (shift left)

If widespread unemployment leads to a drop in incomes​, then the demand for the Toyota Rav4 SUV would​ __________. A. increase (shift right) B. remain unchanged. C. decrease ( shift left)

decrease (shift left)

For a trade to take​ place, a​ buyer's willingness to pay must be​ ____________. A. higher than the​ seller's willingness to accept. B. equal to the​ seller's willingness to accept. C. lower than the​ seller's willingness to accept. D. A and B only. E. All of the above.

A and B only.

What is meant by holding all else equal and how is this concept used when discussing movements along the demand​ curve? A. everything else in the economy is held​ constant, including the price of the good. B. All variables in the model are set to equal values. C. All variables that can affect the demand for the good are held constant. D. All of the above.

All variables that can affect the demand for the good are held constant.

If the number of people over the age of 16 in the country increased significantly​, then the demand for the Toyota Rav4 SUV would​ __________. A. remain unchanged. B. increase (shift right) C. decrease (shift left)

B. increase (shift right)

Two airlines serve the route between Tampa and Houston. What will happen to one airline if the other one raises its​ prices? A. There will be a movement​ upward, to the​ left, along its initial demand curve. B. Its demand curve will shift to the left. C. Its demand curve will shift to the right. D. There will be a movement​ downward, to the​ right, along its initial demand curve.

Its demand curve will shift to the right.

A supply curve has a _________ slope due to the Law of Supply. The Law of Supply states that supplies ___________ as price increases.

Positive, increase

Which would be the correct sequence of events in the speedboat industry if waterway access was improved​ and, at the same​ time, a lighter polymer became available that increased production​ efficiency? A. Supply would shift​ left, demand would shift​ right, equilibrium price would​ decrease, and equilibrium quantity would increase. B. Supply would shift​ left, demand would shift​ left, equilibrium price would be​ indeterminable, and equilibrium quantity would decrease. C. Supply would shift​ right, demand would shift​ left, equilibrium price would​ increase, and equilibrium quantity would be indeterminable. D. Supply would shift​ right, demand would shift​ right, equilibrium price would be​ indeterminable, and equilibrium quantity would increase.

Supply would shift​ right, demand would shift​ right, equilibrium price would be​ indeterminable, and equilibrium quantity would increase.

What does it mean to say that we are running out of​ "cheap oil"? A. That oil reserves are becoming more expensive to find and extract over time. B. That world demand for oil is​ declining, which will raise the price of oil in the future. C. That there are declining reserves of​ low-quality oil, but there is still plenty of​ high-quality oil remaining. D. That we will soon deplete all the​ world's oil​ reserves, which will cause the price of oil to increase significantly.

That oil reserves are becoming more expensive to find and extract over time.

How would an increase in supply affect the equilibrium price in a​ market? A. The equilibrium price increases. B. The equilibrium price decreases. C. The equilibrium price would remain the same. D. More information is needed. It may​ increase, decrease, or remain the same.

The equilibrium price decreases.

How would the equilibrium price in a market be affected if there were a large increase in supply and a small increase in demand​? A. The equilibrium price decreases. B. The equilibrium price would remain the same. C. The equilibrium price increases. D. More information is needed. It may​ increase, decrease, or remain the same.

The equilibrium price decreases.

How would the equilibrium price in a market be affected if there were a large decrease in supply and a small decrease in demand​? A. The equilibrium price increases. B. The equilibrium price would remain the same. C. The equilibrium price decreases. D. More information is needed. It may​ increase, decrease, or remain the same.

The equilibrium price increases.

What does this imply for the price of oil in the​ future? A. The demand for oil will​ decrease, which will lead to higher prices in the future. B. The supply of oil will​ increase, which will lead to lower prices in the future. C. The supply of oil will​ decrease, which will lead to higher prices in the future. D. The demand for oil will​ increase, which will lead to lower prices in the future.

The supply of oil will​ decrease, which will lead to higher prices in the future.

Land in​ Sonoma, California, can be used to either grow grapes for pinot noir wine or to grow Gravenstein apples. Given this​ information, what is the relationship between pinot noir wine and Gravenstein​ apples? A. They are substitutes in consumption. B. They share a common input. C. They are complements in consumption. D. They are completely unrelated.

They share a common input.

Holding all else​ equal, if the price of a digital camera​ rises, then we can expect A. a decrease in the quantity demanded of digital cameras. B. an increase in the quantity demanded of digital cameras. C. an increase in the demand for digital cameras. D. a decrease in the demand for digital cameras.

a decrease in the QUANTITY demanded of digital cameras.

All of the following would cause a shift in the supply curve for orange​ juice, except A. a freeze over all of Florida for three nights in a row. B. tax credits for citrus farmers. C. a new medical discovery about the benefits of citrus. D. new machinery that speeds up the picking process.

a new medical discovery about the benefits of citrus.

If the demand for pinot noir suddenly shifts sharply to the​ right, we would expect to see (no change, an increase, a decrease) in the demand for land in​ Sonoma, which would (increase, no impact, decrease) the equilibrium price of land.

an increase, increase

Willingness to accept is the (lowest, highest) price that a seller is willing to get paid to sell an extra unit of a good. Willingness to accept is the same as the (marginal, fixed) cost of production.

lowest, marginal

A competitive market will A. create excess demand because wants exceed needs. B. move towards equilibrium because producers set the prices. C. create excess supply because producers want profits. D. move towards equilibrium quantity because both producers and consumers act in their own best interest.

move towards equilibrium quantity because both producers and consumers act in their own best interest.

A demand curve has a (negative, positve) slope due to the Law of Demand. The Law of Demand is based off of a​ consumer's willingness to pay (more, less) as marginal units are consumed.

negative, less

We make the assumption of holding all else equal when considering demand curves since we want to focus on the changes in the quantity demanded that result from changes in ________________ a. the price of goods and incomes b. only the price of the good c. only the price of consumers incomes

only the price of the good

Which change causes a movement along the demand​ curve? A. number and scale of buyers B. tastes and preferences C. ​buyer's beliefs about the future D. price of the good itself

price of the good itself

An aggregated demand curve is created by summing the (quantity demanded at each price, prices for each quantity demanded) on the individual demand ( curves, schedules).

quantity demanded at each price, curves

The concept of diminishing marginal benefits states that A. the more you consume of a​ good, your willingness to pay for an additional unit declines. B. the more you consume of a​ good, the less benefit you receive. C. the more you pay for a​ good, the less benefit you receive. D. the more you pay for a​ good, the greater the benefit you receive.

the more you consume of a​ good, your willingness to pay for an additional unit declines.

The lowest price that a seller is willing to receive to sell an extra unit of a good is called (willingness to exchange, willingness to pay, willingness to accept) ​, while the highest price that a buyer is willing to pay for an extra unit of a good is called (willingness to exchange, willingness to pay, willingness to accept).

willingness to accept, willingness to pay

Suppose one of your friends offered the following​ argument: A rightward shift in demand will cause an increase in price. The increase in price will cause a rightward shift of the supply​ curve, which will lead to an offsetting decrease in price.​ Therefore, it is impossible to tell what effect an increase in demand will have on price. Do you agree with your​ friend? A. ​Yes, since the shift in demand that raises the price must cause an offsetting shift in​ supply, we cannot know the impact on price. B. ​Yes, any time both the supply and demand curves​ shift, it becomes impossible to accurately determine the impact on the price of a good. C. ​No, the increase in price will not cause a shift of the supply curve. D. ​No, the offsetting supply shift caused by the higher price will not be as large as the demand​ shift, so we know the price will rise some.

​No, the increase in price will not cause a shift of the supply curve.

Does the shape of the market demand curve differ from the shape of an individual demand​ curve? A. ​No, they both tend to be​ upward-sloping curves. B. ​No, they both tend to be​ downward-sloping curves. C. ​Yes, individual demand curves tend to be​ upward-sloping, while market demand curves are horizontal. D. ​Yes, individual demand curves tend to be​ downward-sloping, while market demand curves are​ upward-sloping.

​No, they both tend to be​ downward-sloping curves.

The Law of Supply states​ that, in most​ cases, the quantity supplied of a good​ ___________ when the price of the good rises. This means we would expect a typical supply curve to​ be___________. A. ​rises; upward-sloping. B. ​falls; downward-sloping. C. ​falls; upward-sloping. D. ​rises; downward-sloping.

​rises; upward-sloping.