Question 1

Figure 3-15
  
-Refer to Figure 3-15.Which area represents producer surplus when the price is P₁?

Accepted Answer

A) BCE 
B) ACF 
C) ABED 
D) DEF 
A) BCE 
B) ACF 
C) ABED 
D) DEF

Question 2

If a large percentage increase in the price of a good results in a small percentage increase in the quantity supplied of the good,supply is said to be

Accepted Answer

A) horizontal. 
B) relatively inelastic. 
C) relatively elastic. 
D) income proof. 
A) horizontal. 
B) relatively inelastic. 
C) relatively elastic. 
D) income proof.

Question 3

Suppose demand increases and supply increases.Which of the following will happen?

Accepted Answer

A) Equilibrium price will rise,fall,or stay the same while equilibrium quantity will decrease. 
B) Equilibrium price will rise,fall,or stay the same while equilibrium quantity will increase. 
C) Equilibrium quantity will rise,fall,or stay the same and equilibrium price will increase. 
D) Equilibrium quantity will rise,fall,or stay the same while equilibrium price will decrease. 
E) The change in equilibrium price and quantity cannot be determined. 
A) Equilibrium price will rise,fall,or stay the same while equilibrium quantity will decrease. 
B) Equilibrium price will rise,fall,or stay the same while equilibrium quantity will increase. 
C) Equilibrium quantity will rise,fall,or stay the same and equilibrium price will increase. 
D) Equilibrium quantity will rise,fall,or stay the same while equilibrium price will decrease. 
E) The change in equilibrium price and quantity cannot be determined.

Question 4

In which statement(s)is "supply" used correctly?
(I)"An increase in the price of eggs will increase the supply of eggs."
(II)"As the cost of producing eggs rises,the supply of eggs will tend to fall."

Accepted Answer

A) in both statements I and II 
B) in statement I only 
C) in statement II only 
D) in neither statements I nor II 
A) in both statements I and II 
B) in statement I only 
C) in statement II only 
D) in neither statements I nor II

Question 5

Which of the following is a function performed by market prices?

Accepted Answer

A) Market prices communicate information to buyers and sellers. 
B) Market prices coordinate the decisions of buyers and sellers. 
C) Market prices motivate entrepreneurs to produce those products that are currently most desired relative to their costs of production. 
D) All of the above are functions performed by market prices. 
A) Market prices communicate information to buyers and sellers. 
B) Market prices coordinate the decisions of buyers and sellers. 
C) Market prices motivate entrepreneurs to produce those products that are currently most desired relative to their costs of production. 
D) All of the above are functions performed by market prices.

Exam 3: Asupply,demand,and the Market Process

Figure 3-15 -Refer to Figure 3-15.Which area represents producer surplus when the price is P₁?

If a large percentage increase in the price of a good results in a small percentage increase in the quantity supplied of the good,supply is said to be

Suppose demand increases and supply increases.Which of the following will happen?

In which statement(s)is "supply" used correctly? (I)"An increase in the price of eggs will increase the supply of eggs." (II)"As the cost of producing eggs rises,the supply of eggs will tend to fall."

Which of the following is a function performed by market prices?

The Economic Approach

Asome Tools of the Economist

Asupply and Demand: Applications and Extensions

Difficult Cases for the Market and the Role of Government

The Economics of Collective Decision-Making

Ataking the Nations Economic Pulse

Economic Fluctuations, unemployment, and Inflation

Aan Introduction to Basic Macroeconomic Markets

Dynamic Change, economic Fluctuations, and the Ad-As Model

Fiscal Policy: the Keynesian View and Historical Perspective

Fiscal Policy, incentives, and Secondary Effects

Amoney and the Banking System

Modern Macroeconomics and Monetary Policy

Stabilization Policy, output, and Employment

Creating an Environment for Growth and Prosperity

Institutions,policies,and Cross-Country Differences in Income and Growth

Gaining From International Trade

International Finance and the Foreign Exchange Market

Consumer Choice and Elasticity

Acosts and the Supply of Goods

Aprice Takers and the Competitive Process

Price-Searcher Markets With Low Entry Barriers

Aprice-Searcher Markets With High Entry Barriers

The Supply of and Demand for Productive Resources

Earnings, productivity, and the Job Market

Investment, the Capital Market, and the Wealth of Nations

Income Inequality and Poverty

Government Spending and Taxation

The Economics of Social Security

The Stock Market: Its Function, Performance, and Potential As an Investment Opportunity

Great Debates in Economics: Keynes Versus Hayek

The Crisis of 2008: Causes and Lessons for the Future

Lessons From the Great Depression

Lessons From Japan and Canada

The Federal Budget and the National Debt

The Economics of Healthcare

Education: Problems and Performance

Earnings Differences Between Men and Women

Do Labor Unions Increase the Wages of Workers

The Question of Resource Exhaustion

Difficult Environmental Cases and the Role of Government

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