Question: Which of the following best describes a normal good?
Answer Options:
A. As consumer incomes increase, demand increases.
B. As consumer incomes increase, the quantity demanded increases.
C. As price increases, the quantity demanded decreases.
D. As price increases the quantity supplied increases.
Answer: A. As consumer incomes increase, demand increases.
Question: If the price of peanuts falls, which of the following would be least likely to occur?
Answer Options:
A. The demand for peanuts will shift out.
B. The quantity of peanuts demanded will increase.
C. The peanut butter supply curve will shift out.
D. The quantity of peanuts supplied would fall.
Answer: A. The demand for peanuts will shift out.
Question: Which event provides the most likely explanation for what is occurring in this graph?
Answer Options:
A. Electricity used to chill ice becomes much more expensive.
B. The price of snow cones rises significantly.
C. The price of snow cones drops significantly.
D. Global cooling reduces the number of hot summer days.
Answer: D. Global cooling reduces the number of hot summer days.
Question: Delta flies Boeing 757s that have 258 seats. However, Delta only has enough gates at Nashville to handle 1 flight a day from Detroit. Which graph best represents the daily supply of seats on Delta flights from Detroit to Nashville?
Answer Options:
Graph A
Graph B
Graph C
Graph D
Answer: Graph C
Question: There are dozens of very similar lemonades out there in the market today. Which graph is most likely to represent the market demand curve for Pucker Up, one of those brands?
Answer Options:
Graph A
Graph B
Graph C
Graph D
Answer: Graph A
Question: A tax on producers is likely to
Answer Options:
A. shift the supply curve back.
B. shift the demand curve back.
C. shift the demand curve out.
D. shift the supply curve out.
Answer: A. shift the supply curve back.
Question: Which of the following would be most likely to shift the supply curve for Samsung’s Galaxy phone inward?
Answer Options:
A. Manufacturing workers in Vietnam, where the most Galaxy phones are assembled, demand higher wages.
B. The rare earth elements needed to produce Galaxy phones become more abundant.
C. Samsung raises the price of the Galaxy phone.
D. Apple unveils a new faster iPhone.
Answer: A. Manufacturing workers in Vietnam, where the most Galaxy phones are assembled, demand higher wages.
Question: The movement from Point A to Point B in this graph is most likely the result of
Answer Options:
A. a decrease in the price of this product.
B. an increase in the price of an input for this product.
C. the government imposing a tax on the producer of this product.
D. an increase in the price of this product.
E. a decrease in the price of an input for this product.
Answer: D. an increase in the price of this product.
Question: A positively sloped supply curve indicates that
Answer Options:
A. consumers are willing to pay more for the good.
B. producers can sell more at higher prices.
C. price rises as supply increases.
D. the marginal cost of producing the good is increasing as output increases.
Answer: D. the marginal cost of producing the good is increasing as output increases.