Macroeconomics Test 1

price signals drive the market mechanism

Which of the following best describes the "invisible hand?"

corresponds to a movement along the demand curve

a change in demand means there has been a shift in the demand curve, and a change in quantity demanded:

the quantity demanded equals the quantity supplied

a market is said to be in equilibrium when:

the quantity supplied exceeds the quantity demanded at a given prices

a market surplus occurs when:

a change in the quantity supplied

a movement along the supply curve is the same as:

demand

a shift of the demand curve is referred to as a change in:

the quantity demanded of a good increases

according to the law of demand, as price decreases:

the quantity demanded of computer games will decrease

according to the law of demand, if the price of a computer game increases from $25 to $30, then the:

quantity demanded of movie tickets will increase

according to the law of demand, if the price of a movie ticket decreases from $9 to $6, then the:

price and quantity demanded are inversely related

according to the law of demand:

the cost of producing frozen yogurt decreases

an increase in the supply of frozen yogurt will take place when:

to distinguish a movement along a demand curve from a shift in demand

economists make a distinction between changes in quantity demanded and in demand:

consumers will compete for the product by offering to pay more

if a market shortage exists:

a shortage exists at the old price

if the price of a good is currently below the equilibrium price, the price will increase over time because:

a surplus exists at the old price

if the price of the good is currently above the equilibrium price, the price will decrease over time because:

a decrease in the supply of corn syrup

if the subsidies given to corn syrup producers decreases, then we can expect:

a belief of nonintervention by government in the market mechanism

laissez faire refers to:

a decrease in income

the demand curve for a good will shift to the left in response to:

decrease in income

the demand curve for a good will shift to the left in response to:

an increase in tastes or preferences for the good

the demand curve for a good will shift to the right in response to:

market mechanism

the equilibrium price and quantity are determined by the:

is the sum of individual demands for the good

the market demand for a particular good

is the sum of the individual demands for the good

the market demand for a particular good

the total quantities that buyers are willing and able to purchase at alternative prices in a given period of time

the market demand for a particular good indicates:

is the sum of the quantities of the good that all producers are willing and able to sell:

the market supply of a particular good

if the total quantities that producers are willing and able to sell at alternative prices in a given time period

the market supply of a particular good 2:

is the sum of the quantities of the good that all producers are willing and able to sell

the market supply of a particular good:

is the total quantities that producers are willing and able to sell at alternative prices in a given time period

the market supply of a particular good:

relies on prices and sales to communicate consumer wants to producers

The market mechanism:

price

The essential signal of the market mechanism is:

holding everything else constant

ceteris paribus means:

a lower price for the good

the quantity demanded of a good will increase in response to:

the costs of producing the good

the quantity of a good that suppliers are willing and able to supply at a given price in a given time period depends on:

some buyers will offer to pay a higher price, initiating a move up the demand curve

when there is a shortage in a market, prices are likely to rise because:

buyers do not wish to buy as much as sellers want to sell

when there is a surplus in a market, prices are likely to fall because:

an improvement in the technology used to produce automobiles

which of the following events would cause a rightward shift in the supply curve for automobiles?

income

which of the following is a determinant of demand?

prices of the factors of production

which of the following is a determinant of supply?

improved technology shifts the supply curve to the right

which of the following provides the best example of the law of supply?

new technology

which of the following will cause a change in quantity supplied?

an increase in the taxes on electricity production

which of the following will cause a leftward shift of the supply curve for electricity?

an increase in the cost of construction materials

which of the following will cause a leftward shift of the supply curve for houses?

the population grows and people like bread

which of the following will cause the demand curve for bread to shift to the right?

consumer incomes increase

which of the following will cause the demand for ice cream to increase?

many students in the town begin to diet

which of the following will cause the demand for pizza to decrease in a college town

an increase in the number of student

which of the following will cause the demand for pizza to increase in a college town?

the number of hamburger restaurants increases

which of the following will cause the supply of hamburgers to increase?

the cost of milk, a key ingredient, decreases

which of the following will cause the supply of milk shakes to increase?

the price of lumber, an ingredient in paper production, increases

which of the following will cause the supply of paper to decrease?

the price of the good itself

which of the following will not cause a shift in the demand curve for a good?

a change in the technology used to produce natural gas

which of the following will not shift the demand curve for natural gas?