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HW 3 ECON

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Asayena Viengmany
Quiz by Asayena Viengmany, updated more than 1 year ago
Asayena Viengmany
Created by Asayena Viengmany over 6 years ago
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Question 1

Question
The downward slope of the demand curve again illustrates the pattern that as _____________ rises, _________________ decreases.
Answer
  • quantity demanded, price
  • quantity supplied, quantity demanded
  • price, quantity demanded
  • price, quantity supplied

Question 2

Question
The nature of demand indicates that as the price of a good increases:
Answer
  • suppliers wish to sell less of it
  • more of it is produced
  • more of it is desired
  • buyers desire to purchase less of it

Question 3

Question
The term "ceteris paribus" means that:
Answer
  • everything is variable
  • all variable except those specified are constant
  • no one knows which variables will change and which will remain constant
  • what is true for the individual is not necessarily true for the whole

Question 4

Question
Economists refer to the relationship that a higher price leads to a lower quantity demanded as the _____________.
Answer
  • income gap
  • market equilibrium
  • law of demand
  • price model

Question 5

Question
_________________ refers to the total number of units that are purchased at that price.
Answer
  • quantity
  • quantity demanded
  • supply
  • market quantity

Question 6

Question
The demand curve for a typical good has a(n):
Answer
  • negative slope because some consumers switch to other goods as the price rises.
  • negative slope because consumer incomes fall as the price of the good rises.
  • negative slope because the good has less "snob appeal" as its price falls.
  • inverse slope because as the price goes up, the good has more profitability.

Question 7

Question
But nearly all supply curves share a basic similarity: they slope _______________.
Answer
  • down from left to right
  • up from left to right
  • up from right to left
  • down from right to left

Question 8

Question
When quantity demanded decreases in response to a change in price:
Answer
  • demand curve shifts to the right
  • demand curve shifts to the left
  • there is a movement down along the demand curve
  • there is movement up along the demand curve

Question 9

Question
The ___________ is the only price where quantity demanded is equal to quantity supplied.
Answer
  • equilibrium price
  • horizontal axis intercept
  • vertical axis intercept
  • market price

Question 10

Question
After widespread press reports about the dangers of contracting "mad cow disease" by consuming beef from Canada, the likely economic effect on the U.S. demand curve for beef from Canada is:
Answer
  • no change; only the supply curve for beef is likely to be affected.
  • a shift of the demand curve for beef to the left
  • a movement down along the demand curve for beef to the right.
  • a shift of the demand curve for beef to the right.

Question 11

Question
If a firm faces ________________________, while the prices for the output the firm produces remain unchanged, a firm’s profits will increase.
Answer
  • higher demand
  • lower costs of production
  • equilibrium
  • shift in demand

Question 12

Question
When __________________, a firm will supply a higher quantity at any given price for its output, and the supply curve will shift to the right.
Answer
  • prices rise
  • equilibrium is achieved
  • costs of production fall
  • there is a population increase

Question 13

Question
A severe freeze has once again damaged the Florida orange crop. The impact on the market for orange juice will be a leftward shift of:
Answer
  • the supply curve
  • the demand curve, as consumers try to economize because of the shortage
  • both supply and demand curve
  • the supply curve and a rightward shift of the demand curve, resulting in a higher equilibrium price

Question 14

Question
A change in price of a good or service typically causes ___________________________ for that specific good or service.
Answer
  • a new equilibrium price
  • a change along the supply curve
  • the supply curve to shift
  • a decreased demand

Question 15

Question
According to the law of supply:
Answer
  • there is a direct relationship between price and the quantity supplied.
  • there is an inverse relationship between price and the quantity supplied.
  • there is a direct relationship between price and quantity demanded.
  • there is an inverse relationship between price and quantity demanded

Question 16

Question
Which of the following would reduce the supply of microcomputers?
Answer
  • a technological improvement that lowers the cost of producing the computers
  • higher wage rates for the workers that assemble the computers
  • a reduction in the price of computer chips used to produce the computers
  • a reduction in the price of computers.

Question 17

Question
Interpret the following statement: "An increase in the price of wheat will encourage farmers to increase the quantity of wheat supplied to the market."
Answer
  • The statement is correct.
  • The statement would be correct if "quantity of wheat demanded" were substituted for "quantity of wheat supplied."
  • The statement is incorrect because it confuses a change in quantity supplied with a change in supply.
  • The statement would be correct if it read that a "decrease in the price of wheat will encourage farmers to increase the quantity of wheat supplied to the market."

Question 18

Question
Andy views beer and pizza as complements to one another. If the price of pizza decreases, economists would expect:
Answer
  • Andy's demand for pizza to increase.
  • Andy's demand for pizza to decrease.
  • Andy's quantity of pizza demanded to decrease.
  • Andy's demand for beer to increase.

Question 19

Question
If the price is below the equilibrium level, then the quantity demanded will exceed the quantity supplied. This is known as ___________________
Answer
  • excess supply
  • excess demand
  • ceteris paribus
  • a price ceiling

Question 20

Question
The ____________ is the quantity where quantity demanded and quantity supplied are equal at a certain price.
Answer
  • quantity demanded
  • equilibrium quantity
  • demand schedule
  • supply schedule
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