Test 1

A  Student slot into Harvard Medical School

B  Chanel Shoes

C  Rare metal coins

D  Lamborghini

A  Lamborghini

B  Rare metal coins

C  Student slot into Harvard Medical School

D  Chanel Shoes

A  A change in the price of the good in the model

B  None of the available answers

C  A change in taxes on consumers

D  A change in income

A  A change in the price of a substitute good

B  A change in society’s income

C  A change in the price of the good

D  A change in advertising expenditures

A  rises, raising their equilibrium price and quantity.

B  falls, lowering their equilibrium price and raising equilibrium quantity.

C  falls, lowering their equilibrium price and quantity.

D  falls, raising their equilibrium price and lowering equilibrium quantity.

A  we are considering all the changes which might take place in actual markets.

B  an equilibrium quantity has been reached.

C  we are considering changes in just one factor.

D  an equilibrium price has been reached.

A  The net benefit from saving interest payments on the $10,000 auto loan

B  All of the available answers

C  The foregone interest expense you would have incurred on the $10,000

D  The amount of investment income or interest income you could have earned by investing or loaning out that $10,000

A  a shortage will develop.

B  a surplus will develop.

C  the supply curve will shift to the right.

D  the demand curve will shift to the left.

A  False

B  True

A  up, the quantity demanded goes down.

B  down, the quantity demanded goes down.

C  up, the quantity demanded also goes up.

D  down, the quantity demanded stays the same.

A  True

B  False

A  demand is represented graphically by a curve and quantity demanded as a point on that curve.

B  the quantity demanded is in an inverse relation with prices, whereas demand is in a direct relation.

C  the quantity demanded is in a direct relation with prices, whereas demand is in an inverse relation.

D  the quantity demanded is represented graphically by a curve and demand as a point on that curve.

A  excess production

B  excess supply

C  Excess demand

D  not enough information provided to answer the question

A  Disequilibrium to due to an endogenous shock in the marketplace

B  excess demand

C  excess equilibrium

D  excess supply

A  Equilibrium quantity declined because the decrease in demand and supply both led to a decrease in quantity.  The equilibrium price declined.  This is due to the fact that we are not given information about the relative size of the shifts.  A decrease in demand tends to decrease price, but the decrease in supply tends to decrease price.

B  Equilibrium quantity increased because the decrease in demand and supply both led to an increase in quantity.  The change in equilibrium price is ambiguous.  This is due to the fact that we are not given information about the relative size of the shifts.  A decrease in demand tends to decrease price, but the decrease in supply tends to increase price.

C  The change in equilibrium quantity is ambiguous.  A decrease in demand tends to decrease quantity, while a decrease in supply tends to increase quantity. The equilibrium price declined.  This is due to the fact that we are not given information about the relative size of the shifts.  A decrease in demand tends to decrease price, but the decrease in supply tends to decrease price.

D  Equilibrium quantity declined because the decrease in demand and supply both led to a decrease in quantity.  The change in equilibrium price is ambiguous.  This is due to the fact that we are not given information about the relative size of the shifts.  A decrease in demand tends to decrease price, but the decrease in supply tends to increase price.

A  The equilibrium quantity increased, but we can’t tell what happened to the equilibrium price because we aren’t given any information about the relative size of the shifts in supply and demand in the market.

B  The equilibrium price decreased, but we can’t tell what happened to the equilibrium quantity because we aren’t given any information about the relative size of the shifts in supply and demand in the market.

C  The equilibrium quantity decreased, but we can’t tell what happened to the equilibrium price because we aren’t given any information about the relative size of the shifts in supply and demand in the market.

D  The equilibrium price increased, but we can’t tell what happened to the equilibrium quantity because we aren’t given any information about the relative size of the shifts in supply and demand in the market.

A  Demand will decrease in the medical care market initially due to insurance premium costs, but will increase over the long term

B  Total expenditures will decline

C  Total expenditures will increase

D  The total quantity will decline

A  a surplus of apartments

B  excess supply

C  a shortage of apartments

D  no effect

A  the supply curve will shift again after demand meets supply

B  the equilibrium quantity will fall

C  the equilibrium price will increase

D  the equilibrium price will decrease

A  equilibrium price decreases and quantity increases

B  equilibrium price and quantity decreases

C  equilibrium price and quantity increases

D  equilibrium price increases and quantity decreases

A  the supply curve will shift again after demand meets supply

B  the equilibrium price increases

C  the demand curve will shift back to its original level

D  the equilibrium price increases, albeit by a negligible amount

A  includes only monetary outlays.

B  is the net benefit forgone by not undertaking the next best alternative.

C  is nonexistent for some choices.

D  is the same as sunk cost.

A  the marginal revenue it receives from that factory

B  the costs that it would had incurred if it invested the $60,000,000 into a clothing factory

C  the benefit it could have received from investing the $60,000,000 into a clothing factory

D  the material costs that go into producing another shoe in that factory

A  the market price is below equilibrium

B  price is most likely going to decline

C  the market price is above equilibrium

D  the market price is at the equilibrium price

A  total cost and total benefit.

B  marginal cost and marginal benefit.

C  sunk cost and marginal cost.

D  marginal cost, sunk cost, and total benefit.

A  leftward shift in supply keeping demand constant.

B  rightward shift in demand and a leftward shift in supply.

C  leftward shift in demand keeping supply constant.

D  rightward shift in supply and demand.

A  leftward shift in supply and no shift in demand.

B  rightward shift in supply and a leftward shift in demand.

C  leftward shift in demand and no shift in supply.

D  leftward shift in supply and a rightward shift in demand.

A  supply of natural gas exports to shift to the left.

B  quantity of natural gas exports produced to increase.

C  demand for natural gas exports to shift to the right.

D  supply of natural gas exports to shift to the right.

A  True

B  False

A  False

B  True

A  True

B  False