Question 1

The law of demand

Accepted Answer

A) was passed by the 102nd U.S. Congress. 
B) is a natural law, much like the law of gravity. 
C) is considered a "law" in economics because of the overwhelming empirical evidence that supports its logic. 
D) is considered a "law" in economics in order to force economic models to operate fully. 
A) was passed by the 102nd U.S. Congress. 
B) is a natural law, much like the law of gravity. 
C) is considered a "law" in economics because of the overwhelming empirical evidence that supports its logic. 
D) is considered a "law" in economics in order to force economic models to operate fully.

Question 2

If the price of automobiles were to decrease substantially, the demand curve for public transportation would most likely

Accepted Answer

A) shift rightward. 
B) shift leftward. 
C) remain unchanged. 
D) remain unchanged while quantity demanded would change. 
A) shift rightward. 
B) shift leftward. 
C) remain unchanged. 
D) remain unchanged while quantity demanded would change.

Question 3

-The figure above shows a graph of the market for pizzas in a large town. What characterizes the equilibrium in this market?

Accepted Answer

A) There is excess supply at the equilibrium price of $7. 
B) The government has selected the appropriate price for pizzas. 
C) The quantity supplied equals the quantity demanded. 
D) Supply equals demand. 
A) There is excess supply at the equilibrium price of $7. 
B) The government has selected the appropriate price for pizzas. 
C) The quantity supplied equals the quantity demanded. 
D) Supply equals demand.

Question 4

A price ceiling that is set above the equilibrium price

Accepted Answer

A) causes suppliers to raise their prices. 
B) is binding. 
C) is non-binding. 
D) creates a shortage. 
A) causes suppliers to raise their prices. 
B) is binding. 
C) is non-binding. 
D) creates a shortage.

Question 5

-The above figure shows a graph of the market for pizzas in a large town. No pizzas will be supplied unless the price is above

Accepted Answer

A) $0. 
B) $5. 
C) $12. 
D) $14. 
A) $0. 
B) $5. 
C) $12. 
D) $14.

Question 6

If pizza and tacos are substitutes, a decrease in the price of tacos would lead to a

Accepted Answer

A) decrease in the demand curve for pizza. 
B) decrease in the quantity demanded of pizza. 
C) decrease in the price of pizza. 
D) All of the above. 
A) decrease in the demand curve for pizza. 
B) decrease in the quantity demanded of pizza. 
C) decrease in the price of pizza. 
D) All of the above.

Question 7

If the government places a $1500 tax on each hybrid car sold

Accepted Answer

A) consumers will stop buying hybrid cars. 
B) the supply curve will shift left by up to $1500, depending on the price elasticity of demand. 
C) the supply curve will shift to the right by $1500. 
D) None of the above. 
A) consumers will stop buying hybrid cars. 
B) the supply curve will shift left by up to $1500, depending on the price elasticity of demand. 
C) the supply curve will shift to the right by $1500. 
D) None of the above.

Question 8

-The above figure shows a graph of the market for pizzas in a large town. Suppose that concern over dietary habits has led the government to impose a restriction that limits suppliers to produce only 40 pizzas. As a result, for prices greater than $7, the

Accepted Answer

A) supply curve is unchanged. 
B) supply curve is vertical. 
C) demand curve becomes vertical. 
D) demand curve becomes horizontal. 
A) supply curve is unchanged. 
B) supply curve is vertical. 
C) demand curve becomes vertical. 
D) demand curve becomes horizontal.

Question 9

From the 1970s through the 1990s, the relative price of a college education has increased greatly. During the same time period, college enrollment has also increased. This evidence suggests that during this time period

Accepted Answer

A) the demand curve for a college education has shifted leftward. 
B) the demand curve for a college education has shifted rightward. 
C) the supply curve for a college education has shifted leftward. 
D) the supply curve for a college education has shifted rightward. 
A) the demand curve for a college education has shifted leftward. 
B) the demand curve for a college education has shifted rightward. 
C) the supply curve for a college education has shifted leftward. 
D) the supply curve for a college education has shifted rightward.

Question 10

If the government institutes a specific tax for a good that has a perfectly elastic demand curve

Accepted Answer

A) the producer passes the entire tax on to the consumer. 
B) the producer must absorb the entire tax. 
C) the producer can generally only pass part of the tax onto the consumer. 
D) the equilibrium price drops. 
A) the producer passes the entire tax on to the consumer. 
B) the producer must absorb the entire tax. 
C) the producer can generally only pass part of the tax onto the consumer. 
D) the equilibrium price drops.

Question 11

Consumer groups tend to lobby for

Accepted Answer

A) price floors. 
B) price ceilings. 
C) quantity quotas. 
D) taxes. 
A) price floors. 
B) price ceilings. 
C) quantity quotas. 
D) taxes.

The law of demand

If the price of automobiles were to decrease substantially, the demand curve for public transportation would most likely

-The figure above shows a graph of the market for pizzas in a large town. What characterizes the equilibrium in this market?

A price ceiling that is set above the equilibrium price

-The above figure shows a graph of the market for pizzas in a large town. No pizzas will be supplied unless the price is above

If pizza and tacos are substitutes, a decrease in the price of tacos would lead to a

If the government places a $1500 tax on each hybrid car sold

-The above figure shows a graph of the market for pizzas in a large town. Suppose that concern over dietary habits has led the government to impose a restriction that limits suppliers to produce only 40 pizzas. As a result, for prices greater than $7, the

From the 1970s through the 1990s, the relative price of a college education has increased greatly. During the same time period, college enrollment has also increased. This evidence suggests that during this time period

If the government institutes a specific tax for a good that has a perfectly elastic demand curve

Consumer groups tend to lobby for

Introduction

Empirical Methods for Demand Analysis

Consumer Choice

Production

Costs

Firm Organization and Market Structure

Competitive Firms and Markets

Monopoly

Pricing With Market Power

Oligopoly and Monopolistic Competition

Game Theory and Business Strategy

Strategies Over Time

Managerial Decision-Making Under Uncertainty

Asymmetric Information

Government and Business

Global Business

Filters

Exam 2: Supply and Demand

The law of demand

If the price of automobiles were to decrease substantially, the demand curve for public transportation would most likely

-The figure above shows a graph of the market for pizzas in a large town. What characterizes the equilibrium in this market?

A price ceiling that is set above the equilibrium price

-The above figure shows a graph of the market for pizzas in a large town. No pizzas will be supplied unless the price is above

If pizza and tacos are substitutes, a decrease in the price of tacos would lead to a

If the government places a $1500 tax on each hybrid car sold

-The above figure shows a graph of the market for pizzas in a large town. Suppose that concern over dietary habits has led the government to impose a restriction that limits suppliers to produce only 40 pizzas. As a result, for prices greater than $7, the

From the 1970s through the 1990s, the relative price of a college education has increased greatly. During the same time period, college enrollment has also increased. This evidence suggests that during this time period

If the government institutes a specific tax for a good that has a perfectly elastic demand curve

Consumer groups tend to lobby for

Introduction

Empirical Methods for Demand Analysis

Consumer Choice

Production

Costs

Firm Organization and Market Structure

Competitive Firms and Markets

Monopoly

Pricing With Market Power

Oligopoly and Monopolistic Competition

Game Theory and Business Strategy

Strategies Over Time

Managerial Decision-Making Under Uncertainty

Asymmetric Information

Government and Business

Global Business

Filters