#### Details of this Paper

##### factors cause a movement along the demand curve

Description

solution

Question

1. Which of the following factors cause a movement along the demand curve? (Points: 1);change in the price of related goods;change in the price of the good;change in the population;both b and c;2. Suppose you manage a grocery store. If peanut butter is an inferior good, what do you suppose would happen to the price and quantity of peanut butter as incomes fall during an economic recession? (Points: 1);the price would increase and the quantity decrease;the price and quantity would both increase;the price and quantity would both decrease;the price would decrease and the quantity increase;3. Which of the following is NOT a determinant of supply? (Points: 1);expectations regarding future prices;the technology of production;the cost of production;consumer tastes;4. A technological advance in the production of automobiles will: (Points: 1);increase the demand for automobiles;increase the supply of automobiles;decrease the demand for automobiles;decrease the supply of automobiles;5. Excess supply occurs when: (Points: 1);the price is above the equlibrium price;the quantity demanded exceeds the quantity supplied;the price is below the equilibrium price;both b and c occur;6. If the economy booms and peoples' incomes rise, then the demand curve for a normal good like new houses will ________ and the equilibrium quantity of new houses produced will _________ (Points: 1);shift to the right, increase;not shift, not change;not shift, increase;shift to the left, decrease;7. The price of microchips used to produce computers falls. As a result, the equilibrium price of computers ________ and the equilibrium quantity ________ (Points: 1);rises, increases;rises, decreases;falls, decreases;falls, increases;8. The government imposes a price ceiling below the equilibrium price. The price ceiling will cause (Points: 1);quantity demanded to decrease;quantity supplied to increase;a shortage of the good;an increase in the quality of the good;9. Rent controls in New York City cause all of the following except (Points: 1);inefficiently low quality;wasted resources resulting from the opportunity cost of time associaated with trying to find an apartment;black markets;an increase in the quantity supplied of rent-controlled apartments;10. Suppose the government sets a price floor of \$2.85 per bushel on corn when the current price is \$2.55. This price floor will (Points: 1);cause a surplus of corn;cause a shortage of corn;have no effect on the price of corn;decrease the supply of corn;11. A binding price floor causes: (Points: 1);a shortage in the market;a surplus in the market;wasted resources;both b and c;12. One of the consequences of increasing the minimum wage has been (Points: 1);increased unemployment for low-skill workers;workers offering to work "off the books" for less than the minimum wage;higher production costs for small business;all of the above;13. If New York City had no medallion system for taxicabs, the price of a taxicab ride would (Points: 1);increase because of the higher safety hazards;not change from its current level;decrease;increase, but only slightly;14. State government place excise taxes on cigarettes because (Points: 1);they want to subsidize tobacco farming;they want to discourasge cigarette smuggling;it's an easy way to raise tax revenue while discouraging smoking;of none of the above;15. The demand for textbooks is price inelastic. Which of the following would explain this? (Points: 1);Many alternative textbooks can be used as substitutes;Students have a lot of time to adjust to price changes;Textbook purchases consume a large portion of most students' income;The good is a necessity;16. Gas prices recently increased by 25%. In response, purchase of gasoline decreased by 5%. The price elasticity of demand for gas is (Points: 1);5;2;0.2;0.5;17. The university hopes to raise more revenue by increasing parking fees. This plan will work only if (Points: 1);the price effect is larger than the quantity effect;the price effect is smaller than the quantity effect;the price effect and quantity effect are the same;there is no price or quantity effect;18. A price floor will cause a larger surplus when demand is ________ and supply is ________ (Points: 1);elastic, inelastic;inelastic, inelastic;elastic, elastic;perfectly inelastic, elastic;19. A price ceiling will cause a larger shortage when demand is ________ and supply is ___________ (Points: 1);elastic, inelastic;inelastic, inelastic;elastic, elastic;perfectly inelastic, elastic;20. Suppose the government imposes a \$4 excise tax on good Y. If the demand for good Y is perfecly inelastic, and the supply curve is elastic, then the price of good Y will (Points: 1);increase by more than \$4;increase by exactly \$4;increase, but by less than \$4;remain constant

Paper#26877 | Written in 18-Jul-2015

Price : \$27