Test 1

A  leftward shift in supply keeping demand constant.

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

C  rightward shift in supply and demand.

D  leftward shift in demand keeping supply constant.

A  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.

B  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.

C  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.

D  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.

A  excess production

B  Excess demand

C  not enough information provided to answer the question

D  excess supply

A  Student slot into Harvard Medical School

B  Rare metal coins

C  Chanel Shoes

D  Lamborghini

A  Yes, because the marginal revenue from producing the additional shoe is greater than the marginal costs

B  Not enough information provided to answer the question

C  No, because Nike already lost $30,000,000 and it should cut its losses and look for additional opportunities

D  No, because the additional profits from the sale of the shoe are miniscule compared to the losses in that year

A  a surplus of apartments

B  a shortage of apartments

C  no effect

D  excess supply

A  the market price is below equilibrium

B  the market price is at the equilibrium price

C  the market price is above equilibrium

D  price is most likely going to decline

A  a surplus

B  excess demand

C  no effect

D  excess supply

A  the equilibrium quantity will fall

B  the equilibrium price will decrease

C  the supply curve will shift again after demand meets supply

D  the equilibrium price will increase

A  A change in income

B  A change in taxes on consumers

C  None of the available answers

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

A  Total expenditures will decline

B  Total expenditures will increase

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

D  The total quantity will decline

A  TRUE

B  FALSE

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

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

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

D  quantity of natural gas exports produced to increase.

A  A change in the price of the good

B  A change in the price of a substitute good

C  A change in advertising expenditures

D  A change in society’s income

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

B  is nonexistent for some choices.

C  is the same as sunk cost.

D  includes only monetary outlays.

A  down, the quantity demanded goes down.

B  up, the quantity demanded goes down.

C  down, the quantity demanded stays the same.

D  up, the quantity demanded also goes up.

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

B  falls, lowering their equilibrium price and quantity.

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

D  rises, raising their equilibrium price and quantity.

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

B  an equilibrium quantity has been reached.

C  an equilibrium price has been reached.

D  we are considering changes in just one factor.

A  FALSE

B  TRUE

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

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

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

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

A  sunk cost and marginal cost.

B  total cost and total benefit.

C  marginal cost and marginal benefit.

D  marginal cost, sunk cost, and total benefit.

A  the supply curve will shift to the right.

B  a shortage will develop.

C  the demand curve will shift to the left.

D  a surplus will develop.