Ec 201 Exam 2 P

34 Questions | Total Attempts: 291

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Practice Exam Quizzes & Trivia

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Questions and Answers
  • 1. 
    The most important concepts in economics, according to the textbook, are supply, demand, and the
    • A. 

      idea of equilibrium.

    • B. 

      Opportunity to barter.

    • C. 

      Quantity of sales.

    • D. 

      The level of prices.

  • 2. 
    Quantity demanded:
    • A. 

      Shows how much buyers are willing and able to buy at different prices.

    • B. 

      Is the amount that buyers are willing and able to buy at a particular price.

    • C. 

      Shows how much sellers are willing and able to sell at different prices.

    • D. 

      Is the amount that sellers are willing and able to sell at a particular price.

  • 3. 
    The demand curve for oil shows:     
    • A. 

      The quantity demanded of oil at different income levels.

    • B. 

      The quantity demanded of oil at different oil prices.

    • C. 

      The demand for oil at different prices of other goods.

    • D. 

      The demand for oil when there is a surplus or shortage.

  • 4. 
    (Figure: Good X) From the figure, which statement is TRUE?     
    • A. 

      At a price of $12 per unit, consumers are willing and able to purchase between 11 and 26 units of Good X.

    • B. 

      36 units of Good X can be purchased by spending a total of $4.

    • C. 

      At a price of $6 per unit, consumers are willing and able to purchase 26 units of Good X.

    • D. 

      At a price of $4 per unit, consumers are willing and able to purchase 11 units of Good X.

  • 5. 
    (Figure: Good X) From the figure, the maximum price that consumers are willing to pay for _____ units of Good X is _____ per unit.
    • A. 

      36; $4

    • B. 

      11; $4

    • C. 

      36; $12

    • D. 

      26; $4

  • 6. 
    Recall the discussion about the demand for oil in your textbook. Which of the following correctly explains why the demand curve for oil is negatively sloped? As the price of oil rises: 
    • A. 

      consumers use oil for more and varied purposes.

    • B. 

      Consumers increasingly use oil only for those purposes without good substitutes.

    • C. 

      Consumers have an incentive to use oil more freely.

    • D. 

      More producers are more willing and able to produce oil.

  • 7. 
    The law of demand suggests a _____ relationship between price and _____. 
    • A. 

      Positive; quantity demanded

    • B. 

      Positive; quantity supplied

    • C. 

      Negative; quantity demanded

    • D. 

      Negative;, quantity supplied

  • 8. 
    (Figure: Potatoes) Refer to the figure. According to the demand curve, if the price of potatoes is $8 a pound, how many pounds are demanded?
    • A. 

      5

    • B. 

      50

    • C. 

      60,000

    • D. 

      80,000

  • 9. 
    (Figure: Potatoes) Refer to the figure. If the price of potatoes is $8 a pound, what is the consumer surplus received?     
    • A. 

      $30,000

    • B. 

      $60,000

    • C. 

      $240,000

    • D. 

      $360,000

  • 10. 
    (Table: Excel Company Survey) The table shows the results of Excel Company's market survey. If the market price of Excel computers is $1,200 each, how much total consumer surplus (in $) are the four consumers earning? 
    • A. 

      $380

    • B. 

      $415

    • C. 

      $345

    • D. 

      $5,145

  • 11. 
    (Table: Sweetbrand Cheesecakes) The table shows the maximum consumer willingness to pay for Sweetbrand cheesecakes. Which of the four consumers receives the most consumer surplus, if the market price of the cheesecakes is $12.50 each? 
    • A. 

      Frodo

    • B. 

      Sam

    • C. 

      Mary

    • D. 

      Pippin

  • 12. 
    (Table: Sweetbrand Cheesecakes) The table shows the maximum consumer willingness to pay for Sweetbrand cheesecakes. Which of the four consumers receives the smallest consumer surplus, if the market price of the cheesecakes is $12.50 each?     
    • A. 

      Frodo

    • B. 

      Sam

    • C. 

      Mary

    • D. 

      Pippin

  • 13. 
    (Figure: Quantity of Good X) Refer to the figure. At a price of $200, consumer surplus is:     
    • A. 

      $20,000.

    • B. 

      $40,000.

    • C. 

      $10,000.

    • D. 

      $200.

  • 14. 
    (Figure: Quantity of Good X) Refer to the figure. As the price falls from $200 to $100, consumer surplus changes by:
    • A. 

      $5,000.

    • B. 

      $10,000.

    • C. 

      $12,500.

    • D. 

      –$25,000.

  • 15. 
    A good is considered normal if demand for it ______ when income ______.     
    • A. 

      Increases; increases

    • B. 

      Decreases; increases

    • C. 

      Stays the same; decreases

    • D. 

      Increases; decreases

  • 16. 
    An inferior good is one that:
    • A. 

      Is of low quality or not very durable.

    • B. 

      Gets poor reviews from objective, independent evaluators.

    • C. 

      No consumers are willing to buy.

    • D. 

      Experiences decreased demand when income increases.

  • 17. 
    In the diagram, which of the following factors would cause the demand curve to shift from D1 to D2? 
    • A. 

      An increase in the price of a substitute good

    • B. 

      A decrease in the price of a complement good

    • C. 

      An increase in the population

    • D. 

      An increase in income if this is an inferior good

  • 18. 
    As the population of elderly in the United States increases, which service will likely see the biggest increase in demand?
    • A. 

      Skateboard repair

    • B. 

      Home medical care

    • C. 

      Career training

    • D. 

      Child day care

  • 19. 
    If the price of computers ______, the demand for printers will ______. 
    • A. 

      Increases; increase

    • B. 

      Decreases; decrease

    • C. 

      Decreases; not change

    • D. 

      Increases; decrease

  • 20. 
    A local university decides to double its enrollment over the next five years in order to increase tuition revenue. Which of the following would most likely occur in the market for rental housing in the surrounding community? 
    • A. 

      A decrease in the price of rental housing

    • B. 

      An increase in the demand for rental housing

    • C. 

      A decrease in the supply of rental housing

    • D. 

      A population change leads to a change in quantity demanded, not demand.

  • 21. 
    Which of the following would cause the demand for hot dog buns to increase? 
    • A. 

      A fall in the price of hot dog buns

    • B. 

      A fall in the price of hot dogs

    • C. 

      A rise in the price of hot dogs

    • D. 

      A rise in the price of hot dog buns

  • 22. 
    • A. 

      At a price higher than $40, the quantity supplied drops to zero.

    • B. 

      At prices of $40 or less, suppliers are willing to sell at least 500 units

    • C. 

      At a price of $40 per unit, suppliers are willing and able to sell 500 units.

    • D. 

      At a price lower than $40, the quantity supplied drops to zero.

  • 23. 
    (Figure: Bananas) Refer to the figure. If the price of bananas is $10 a pound, which number is closest to the number of pounds that suppliers will supply? 
    • A. 

      5

    • B. 

      50

    • C. 

      60,000

    • D. 

      80,000

  • 24. 
    (Figure: Bananas) Refer to the figure. If the price of bananas is $2 a pound, how many pounds of bananas will suppliers supply?
    • A. 

      0

    • B. 

      1

    • C. 

      10

    • D. 

      10,000

  • 25. 
    (Figure: Producer Surplus) Refer to the figure. What is the producer surplus at a price of $2 per unit?
    • A. 

      $5

    • B. 

      $6

    • C. 

      $10

    • D. 

      $20

  • 26. 
    (Figure: Producer Surplus) Refer to the figure. What is the change in producer surplus if the price rises from $2 to $3 per unit?
    • A. 

      $5

    • B. 

      $10

    • C. 

      $15

    • D. 

      $20

  • 27. 
    Which of the following choices contains only factors that cause the supply curve to shift to the right?    
    • A. 

      a fall in production costs, a rise in technology, an increase in taxes on output

    • B. 

      A fall in tastes and preferences for the product, economic growth, and a rise in technology

    • C. 

      A decrease in taxes on production, a fall in subsidies on production, a rise in costs of production

    • D. 

      A rise in technology, a fall in the costs of production, a fall in taxes on output

  • 28. 
    An increase in supply refers to:     
    • A. 

      A rightward shift of the supply curve.

    • B. 

      A leftward shift of the supply curve.

    • C. 

      An upward movement along the supply curve.

    • D. 

      A downward movement along the supply curve.

  • 29. 
    The supply curve illustrates:
    • A. 

      The relationship between the cost of production and price.

    • B. 

      The relationship between the quantity supplied and the price of a good.

    • C. 

      The total cost of producing a good.

    • D. 

      The willingness to produce a good if the technology to produce it becomes available.

  • 30. 
    (Figure: Supply Shift) What would cause the supply curve to shift from S1 to S2 as shown in the diagram?
    • A. 

      An increase in taxes on firms' output

    • B. 

      An increase in the price of inputs used to produce the output

    • C. 

      A decrease in the number of firms that produce the output

    • D. 

      A decrease in the wages paid to union workers who produce the output

  • 31. 
    • A. 

      A decrease in the opportunity costs of producing the good

    • B. 

      A decrease in the costs of production

    • C. 

      An increase in the prices of inputs used in production

    • D. 

      An expected decrease in the future price of the good

  • 32. 
    (Figure: Supply Shifts) In the figure, the initial supply curve is S1. If producers form expectations that the price will be lower in the near future, S1 will:     
    • A. 

      Shift to S2 now.

    • B. 

      Shift to S3 now.

    • C. 

      Not shift now.

    • D. 

      Only shift to S3 in the future.

  • 33. 
    (Figure: Supply Shifts) In the figure, the initial supply curve is S1. Producers engage in market speculation with the belief that the price of the good will increase in the near future. This would be represented in the figure by shifting the:
    • A. 

      Supply curve to S2, resulting in a lower quantity supplied at each price.

    • B. 

      Supply curve to S2, resulting in a higher quantity supplied at each price.

    • C. 

      Supply curve to S3, resulting in a lower quantity supplied at each price.

    • D. 

      Supply curve to S3, resulting in a higher quantity supplied at each price.

  • 34. 
    A farmer can grow soy or sorghum. If the price of soy increases, the opportunity cost of growing sorghum ______, shifting the supply curve of sorghum ______. 
    • A. 

      Decreases; up and to the left

    • B. 

      Increases; up and to the left

    • C. 

      Decreases; down and to the right

    • D. 

      Increases; down and to the right