I need a little bit of help with my Econ study guide. Thanks! 1. A competitive m
ID: 1216255 • Letter: I
Question
I need a little bit of help with my Econ study guide. Thanks!
1. A competitive market is one in which there
A. is only one seller, but there are many buyers.
B. are many sellers, and each seller has the ability to set the price of his product.
C. are many sellers, and they compete with one another in such a way that some sellers are always being forced out of the market.
D. are so many buyers and so many sellers that each has a negligible impact on the price of the product.
2. A decrease in the price of a good would
A. increase the supply of the good.
B. increase the quantity demanded of the good.
C. give producers an incentive to produce more to keep profits from falling.
D. shift the supply curve for the good to the left.
3. If Max experiences a decrease in his income, then we would expect Max’s demand for
A. each good he purchases to remain unchanged.
B. normal goods to decrease.
C. luxury goods to increase.
D. inferior goods to decrease.
4. Good X and good Y are substitutes. If the price of good Y increases, then the
A. demand for good X will decrease.
B. quantity demanded of good X will decrease.
C. demand for good X will increase.
D. quantity demanded of good X will increase.
5. Wheat is the main input in the production of flour. If the price of wheat decreases, then we would expect the
A. demand for flour to increase.
B. demand for flour to decrease.
C. supply of flour to increase.
D. supply of flour to decrease.
6. Which of the following would shift the supply of Packers football jerseys to the right?
A. The Packers make it to the Super Bowl.
B. The price of the jerseys increases by $15.
C. The cost to distribute the jerseys increases.
D. The cost of the fabric used to make the jerseys decreases.
7. If consumers view cappuccinos and lattés as substitutes, what would happen to the equilibrium price and quantity of lattés if the price of cappuccinos rises?
A. Both the equilibrium price and quantity would increase.
B. Both the equilibrium price and quantity would decrease.
C. The equilibrium price would increase, and the equilibrium quantity would decrease.
D. The equilibrium price would decrease, and the equilibrium quantity would increase.
8. The signals that guide the allocation of resources in a market economy are
A. surpluses and shortages.
B. quantities.
C. government policies.
D. prices.
9. For a good that is a luxury, demand
A. tends to be inelastic.
B. tends to be elastic.
C. has unit elasticity.
D. cannot be represented by a demand curve in the usual way.
10. When the price of a good is $5, the quantity demanded is 100 units per month; when the price is $7, the quantity demanded is 80 units per month. Using the midpoint method, the price elasticity of demand is about
A. 0.22.
B. 0.67.
C. 1.33.
D. 1.50.
11. If the price elasticity of demand for a good is 0.3, then a 20 percent decrease in price results in a
A. 0.015 percent increase in the quantity demanded.
B. 0.6 percent increase in the quantity demanded.
C. 6 percent increase in the quantity demanded.
D. 66 percent increase in the quantity demanded.
12. Holding all other forces constant, if increasing the price of a good leads to an increase in total revenue, then the demand for the good must be
A. unit elastic.
B. inelastic.
C. elastic.
D. None of the above is correct because a price increase always leads to an increase in total revenue.
13. Holding all other forces constant, if increasing the price of a good leads to a decrease in total revenue, then the demand for the good must be
A. unit elastic.
B. inelastic.
C. elastic.
D. None of the above is correct because a price increase always leads to an decrease in total revenue.
14. A good will have a more elastic demand, the
A. greater the availability of close substitutes.
B. more broad the definition of the market.
C. shorter the period of time.
D. more it is regarded as a necessity.
15. A price ceiling is
A. often imposed on markets in which “cutthroat competition” would prevail without a price ceiling.
B. a legal maximum on the price at which a good can be sold.
C. often imposed when sellers of a good are successful in their attempts to convince the government that the market outcome is unfair without a price ceiling.
D. All of the above are correct.
16. If a price ceiling is not binding, then
A. there will be a surplus in the market.
B. there will be a shortage in the market.
C. the market will be less efficient than it would be without the price ceiling.
D. there will be no effect on the market price or quantity sold.
17. Under rent control, tenants can expect
A. lower rent and higher quality housing.
B. lower rent and lower quality housing.
C. higher rent and a shortage of rental housing.
D. higher rent and a surplus of rental housing.
18. The minimum wage is an example of a
A. price ceiling.
B. price floor.
C. wage subsidy.
D. tax.
19. Suppose buyers of computers and printers regard the two goods as complements. Then an increase in the price of computers will cause a(n)
A. decrease in the demand for printers
B. in the supply of printers.
C. increase in demand for printers
D. increase in supply of printers
20. Suppose incomes increase in the economy, and the number of sellers of logo shirts also increase. What will happen to equilibrium price and quantity of logo shirts?
A. Equilibrium quantity of logo shirts will decrease but effect on price is ambiguous.
B. Equilibrium price of logo shirts will increase but effect on quantity is ambiguous.
C. Equilibrium price of logo shirts will decrease but effect on quantity is ambiguous.
D. Equilibrium quantity of logo shirts will increase but effect on equilibrium price is ambiguous.
A. is only one seller, but there are many buyers.
B. are many sellers, and each seller has the ability to set the price of his product.
C. are many sellers, and they compete with one another in such a way that some sellers are always being forced out of the market.
D. are so many buyers and so many sellers that each has a negligible impact on the price of the product.
2. A decrease in the price of a good would
A. increase the supply of the good.
B. increase the quantity demanded of the good.
C. give producers an incentive to produce more to keep profits from falling.
D. shift the supply curve for the good to the left.
3. If Max experiences a decrease in his income, then we would expect Max’s demand for
A. each good he purchases to remain unchanged.
B. normal goods to decrease.
C. luxury goods to increase.
D. inferior goods to decrease.
4. Good X and good Y are substitutes. If the price of good Y increases, then the
A. demand for good X will decrease.
B. quantity demanded of good X will decrease.
C. demand for good X will increase.
D. quantity demanded of good X will increase.
5. Wheat is the main input in the production of flour. If the price of wheat decreases, then we would expect the
A. demand for flour to increase.
B. demand for flour to decrease.
C. supply of flour to increase.
D. supply of flour to decrease.
6. Which of the following would shift the supply of Packers football jerseys to the right?
A. The Packers make it to the Super Bowl.
B. The price of the jerseys increases by $15.
C. The cost to distribute the jerseys increases.
D. The cost of the fabric used to make the jerseys decreases.
7. If consumers view cappuccinos and lattés as substitutes, what would happen to the equilibrium price and quantity of lattés if the price of cappuccinos rises?
A. Both the equilibrium price and quantity would increase.
B. Both the equilibrium price and quantity would decrease.
C. The equilibrium price would increase, and the equilibrium quantity would decrease.
D. The equilibrium price would decrease, and the equilibrium quantity would increase.
8. The signals that guide the allocation of resources in a market economy are
A. surpluses and shortages.
B. quantities.
C. government policies.
D. prices.
9. For a good that is a luxury, demand
A. tends to be inelastic.
B. tends to be elastic.
C. has unit elasticity.
D. cannot be represented by a demand curve in the usual way.
10. When the price of a good is $5, the quantity demanded is 100 units per month; when the price is $7, the quantity demanded is 80 units per month. Using the midpoint method, the price elasticity of demand is about
A. 0.22.
B. 0.67.
C. 1.33.
D. 1.50.
11. If the price elasticity of demand for a good is 0.3, then a 20 percent decrease in price results in a
A. 0.015 percent increase in the quantity demanded.
B. 0.6 percent increase in the quantity demanded.
C. 6 percent increase in the quantity demanded.
D. 66 percent increase in the quantity demanded.
12. Holding all other forces constant, if increasing the price of a good leads to an increase in total revenue, then the demand for the good must be
A. unit elastic.
B. inelastic.
C. elastic.
D. None of the above is correct because a price increase always leads to an increase in total revenue.
13. Holding all other forces constant, if increasing the price of a good leads to a decrease in total revenue, then the demand for the good must be
A. unit elastic.
B. inelastic.
C. elastic.
D. None of the above is correct because a price increase always leads to an decrease in total revenue.
14. A good will have a more elastic demand, the
A. greater the availability of close substitutes.
B. more broad the definition of the market.
C. shorter the period of time.
D. more it is regarded as a necessity.
15. A price ceiling is
A. often imposed on markets in which “cutthroat competition” would prevail without a price ceiling.
B. a legal maximum on the price at which a good can be sold.
C. often imposed when sellers of a good are successful in their attempts to convince the government that the market outcome is unfair without a price ceiling.
D. All of the above are correct.
16. If a price ceiling is not binding, then
A. there will be a surplus in the market.
B. there will be a shortage in the market.
C. the market will be less efficient than it would be without the price ceiling.
D. there will be no effect on the market price or quantity sold.
17. Under rent control, tenants can expect
A. lower rent and higher quality housing.
B. lower rent and lower quality housing.
C. higher rent and a shortage of rental housing.
D. higher rent and a surplus of rental housing.
18. The minimum wage is an example of a
A. price ceiling.
B. price floor.
C. wage subsidy.
D. tax.
19. Suppose buyers of computers and printers regard the two goods as complements. Then an increase in the price of computers will cause a(n)
A. decrease in the demand for printers
B. in the supply of printers.
C. increase in demand for printers
D. increase in supply of printers
20. Suppose incomes increase in the economy, and the number of sellers of logo shirts also increase. What will happen to equilibrium price and quantity of logo shirts?
A. Equilibrium quantity of logo shirts will decrease but effect on price is ambiguous.
B. Equilibrium price of logo shirts will increase but effect on quantity is ambiguous.
C. Equilibrium price of logo shirts will decrease but effect on quantity is ambiguous.
D. Equilibrium quantity of logo shirts will increase but effect on equilibrium price is ambiguous.
Explanation / Answer
1. D. are so many buyers and so many sellers that each has a negligible impact on the price of the product.
2. B. increase the quantity demanded of the good.
3. B. normal goods to decrease.
4. C. demand for good X will increase.
5. C. supply of flour to increase
6. D. The cost of the fabric used to make the jerseys decreases.
7. D. The equilibrium price would decrease, and the equilibrium quantity would increase.
8. D. prices.
9. B. tends to be elastic.
10. B. 0.67.
11. C. 6 percent increase in the quantity demanded.
Ask rest questions in another post
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.