Test 1

A  leftward shift in demand keeping supply constant.

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

C  rightward shift in supply and demand.

D  leftward shift in supply keeping demand constant.

A  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.

B  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.

C  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.

D  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.

A  excess production

B  excess supply

C  not enough information provided to answer the question

D  Excess demand

A  Lamborghini

B  Rare metal coins

C  Chanel Shoes

D  Student slot into Harvard Medical School

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

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

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

D  Not enough information provided to answer the question

A  no effect

B  a shortage of apartments

C  a surplus of apartments

D  excess supply

A  price is most likely going to decline

B  the market price is below equilibrium

C  the market price is at the equilibrium price

D  the market price is above equilibrium

A  no effect

B  a surplus

C  excess demand

D  excess supply

A  the equilibrium price will increase

B  the equilibrium quantity will fall

C  the equilibrium price will decrease

D  the supply curve will shift again after demand meets supply

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

B  A change in income

C  None of the available answers

D  A change in taxes on consumers

A  Total expenditures will increase

B  Total expenditures will decline

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  quantity of natural gas exports produced to increase.

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

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

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

A  A change in the price of the good

B  A change in society’s income

C  A change in advertising expenditures

D  A change in the price of a substitute good

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

B  includes only monetary outlays.

C  is nonexistent for some choices.

D  is the same as sunk cost.

A  up, the quantity demanded also goes up.

B  down, the quantity demanded stays the same.

C  down, the quantity demanded goes down.

D  up, the quantity demanded goes down.

A  falls, lowering their equilibrium price and quantity.

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

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

D  rises, raising their equilibrium price and quantity.

A  an equilibrium price has been reached.

B  an equilibrium quantity has been reached.

C  we are considering changes in just one factor.

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

A  TRUE

B  FALSE

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

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 represented graphically by a curve and demand as a point on that curve.

A  marginal cost and marginal benefit.

B  marginal cost, sunk cost, and total benefit.

C  sunk cost and marginal cost.

D  total cost and total benefit.

A  a surplus will develop.

B  the demand curve will shift to the left.

C  the supply curve will shift to the right.

D  a shortage will develop.