Quiz 1

The price of a Toyota Prius Hybrid decreases. Assuming new Prius consumers used to have gas-guzzling trucks, this will cause A. a decrease in the demand for gasoline. B. an increase in the demand for gasoline. C. a decrease in the quantity demanded of gasoline. D. an increase in the quantity demanded of gasoline.

A. a decrease in the demand for gasoline.

The difference between a change in supply and a change in the quantity supplied is that the latter is A. produced by a change in the product's own price, while the former is caused by a variety of variables other than the product's price. B. conditional upon a change in the​ former, but not vice versa. C. determined by the willingness of producers to sell while the former is set by the ability of firms to produce. D. shown as a shift in the supply curve while the former is displayed graphically as a movement along a supply curve.

A. produced by a change in the product's own price, while the former is caused by a variety of variables other than the product's price.

Which of the following best describes​ scarcity? A. Wants cannot be fulfilled and thus all goods must be rationed. B. Unlimited wants exceed the limited resources available. C. Markets cannot properly allocate resources. D. Prices of goods are very high.

B. Unlimited wants exceed the limited resources available.

Economics is... A. exclusively the study of the markets for stocks and bonds B. the study of choice under conditions of scarcity C. exclusively the study of business firms D. fundamentally the same as sociology l> E. applicable only when scarcity is not a problem

B. the study of choice under conditions of scarcity

From the list​ below, select the variable that will cause the supply curve to​ shift: A. Prices of related goods B. Population and demographics C. The cost of raw materials D. Consumer income

C. The cost of raw materials

The price of a Toyota Prius Hybrid decreases. This will cause A. demand for Prius' to increase. B. demand for Prius' to decrease. C. quantity demanded of Prius' to increase. D. quantity demanded of Prius' to decrease.

C. quantity demanded of Prius' to increase.

A journalist wrote the following about the effects of falling gasoline​ prices: ​"With lower​ prices, demand rises and people consume​ more." ​(Source: Jeff​ Sommer, "Cheaper​ Oil, Fatter Wallets and a National​ Opportunity," New York Times​, December​ 20, 2014.) Briefly explain whether you agree with the​ journalist's analysis. The​ journalist's statement is A. true because a decrease in the price of gasoline would result in an increase in an increase in demand​, not an increase in quantity demanded​, for gasoline. B. not true because a decrease in the price of gasoline would result in an increase in an increase in demand​, not an increase in quantity demanded​, for gasoline. C. true because a decrease in the price of gasoline would result in an increase in quantity demanded​, not an increase in demand​, for gasoline. D. not true because a decrease in the price of gasoline would result in an increase in quantity demanded​, not an increase in demand​, for gasoline.

D. not true because a decrease in the price of gasoline would result in an increase in quantity demanded​, not an increase in demand​, for gasoline.

The law of demand is the A. rule​ that, holding everything else​ constant, when the price of a good​ rises, the quantity demanded will​ increase, and when the price of a good​ falls, the quantity demanded will decrease. B. requirement that when analyzing the relationship between price and quantity​ demanded, other variables must be held constant. C. rule​ that, holding everything else​ constant, when the price of a good​ rises, the quantity demanded will​ increase, and when the price of a good​ falls, the quantity demanded will increase. D. rule​ that, holding everything else​ constant, when the price of a good​ falls, the quantity demanded will​ increase, and when the price of a good​ rises, the quantity demanded will decrease.

D. rule​ that, holding everything else​ constant, when the price of a good​ falls, the quantity demanded will​ increase, and when the price of a good​ rises, the quantity demanded will decrease.

Economists assume that people are rational in the sense that... A. they do not respond to economic incentives. B. they generally make the correct choices. C. they make decisions based on​ total, rather than​ marginal, variables. D. they use all available information as they take actions intended to achieve their goals

D. they use all available information as they take actions intended to achieve their goals

Economics is the [x] that studies the choices that​ individuals, businesses,​ governments, and entire societies make as they cope with scarcity and the [y] that influence and reconcile our choices.

Possible options for x are theory, social science, graph or field. Possible options for y are money, factors, incentives or limits.