Question: If a new running apparel store opens…
Answer Options: A. supply shifts left B. movement down along supply curve C. movement up along supply curve D. supply shifts right
Answer: D (market supply shifts right)
Question: Generally, monopolies…
Answer Options: A. always beneficial B. beneficial if raise prices w/o interference C. beneficial if natural monopoly & regulated D. never beneficial
Answer: C (may be beneficial if they are natural and regulated)
Question: Ceteris paribus, which can change w/o shifting supply?
Answer Options: A. number of sellers B. prices of other goods C. expectations D. the price of the good itself
Answer: D (the price of the good itself)
Question: When market failure occurs, government’s role is to…
Answer Options: A. push outcomes closer to ideal B. do nothing C. create alternatives D. eliminate markets
Answer: A (push market outcomes closer to the ideal)
Question: A trade _____ when imports > exports.
Answer Options: A. embargo B. war C. deficit D. surplus
Answer: C (deficit)
Question: Which is a financial intermediary?
Answer Options: A. Banks B. U.S. Treasury C. Real estate markets D. Gun shows
Answer: A (Banks)
Question: Likely to shift both demand & supply?
Answer Options: A. technology B. expectations C. price of the good D. income
Answer: B (expectations)
Question: Both demand & supply of salsa increase…
Answer Options: A. Both price & quantity up B. Q up, price indeterminate C. Price up, Q indeterminate D. Both down
Answer: B (The equilibrium quantity increases, price is indeterminate)
Question: Market may still be contestable except…
Answer Options: A. New tech threatens product B. Many domestic firms can enter C. Foreign producers can supply D. Gov’t franchise present
Answer: D (The presence of a government franchise)
Question: Increase in CA electricity price leads to…
Answer Options: A. more consumption B. less imported electricity C. decrease in supply D. increase in imported electricity
Answer: D (increase in electricity imported into California)