Micro Economics Final Exam Questions And
Answers, Updaterd Fall 2023, With Complete
Verified Solution 100%
If a strong economic recovery boosts average incomes, what would happen to
the equilibrium price and quantity of a normal good and of an inferior good?
The equilibrium price and quantityof a normal good would rise; those of an
inferior good would also rise.of a normal good would rise; those of an inferior
good would fall.of a normal good would fall; those of an inferior good would
rise.of a normal good would fall; those of an inferior good would also fall.
of a normal good would rise; those of an inferior good would fall.
Which can cause a shift in the demand curve?
A change in
the price of a good
one of the determinants of demand
the technology used by firms
the cost of production
one of the determinants of demand
Holding everything else constant, producers are willing to offer more units for
sale when the price at which they can sell their product increases.
This concept is known as the
profit-maximizing condition.
law of supply.
maximal output.
law of one price.
law of supply.
Which of the items is most likely to be a complement to coffee?
tea
decaf coffee
baked beans
creamer
creamer
Assume that a monsoon destroys the coffee crop in Vietnam, one of the world's
largest coffee producers. What will likely occur?
The price of sugar and creamer will increase.
Consumers will try to find alternatives to coffee due to increases in the price of
coffee.
People will consume more coffee.
There will be no change in the market for coffee.
Consumers will try to find alternatives to coffee due to increases in the price of coffee.
From an economic context, select the correct definition of a market.an institution
that brings together buyers and sellers of goods or servicesthe process of using
advertising to convince potential buyers to purchase a producta place where
,groceries and other household items are bought and soldan institution where
stocks or bonds are purchased
an institution that brings together buyers and sellers of goods or services
Select all examples of a market.
a local farmer's market
the free-agent signing period in the NFL where players hoping to sign with a team
interact with teams looking for additional players
the New York Stock Exchange
Trader Joe's: a grocery store frequented by "foodie" types
all of theh above
Which can cause a shift in the demand curve?
A change in
the cost of production
the price of a good
the technology used by firms
one of the determinants of demand
one of the determinants of demand
Which of the choices illustrates the law of demand?
Pat
wants to buy more candy bars at $2 than at $1.
None of the choices.
wants to buy more candy bars at $1 than at $2.
offers more candy bars for sale at $2 than at $1.
wants to buy more candy bars at $1 than at $2.
Holding everything else constant, producers are willing to offer more units for
sale when the price at which they can sell their product increases.
This concept is known as thelaw of one price.law of supply.maximal output.profit-
maximizing condition.
law of supply.
Suppose that there has been a sudden influx of refugees in the small town of
Dallon, leading to a doubling of the local population. The accompanying graph
depicts Dallon's market for food. Adjust the graph to show the immediate impact
that this rise in population has on the food market. Then determine what happens
to equilibrium price and quantity.
-Equilibrium price
decreases.
increases.
may increase or decrease, but it is impossible to know for sure.
remains constant.
increase
Suppose that there has been a sudden influx of refugees in the small town of
Dallon, leading to a doubling of the local population. The accompanying graph
depicts Dallon's market for food. Adjust the graph to show the immediate impact
that this rise in population has on the food market. Then determine what happens
to equilibrium price and quantity.
,-Equilibrium quantity
increases.
may increase or decrease, but it is impossible to now for sure.
decreases.
remains constant.
increase
According to the law of demand,
a decrease in price increases quantity demanded.
- mirar foto de graph
The accompanying table gives the supply and demand for orchid leis in Hawaii.
Now assume that severe monsoons and civil unrest in Thailand lead to a
reduction in orchid production by an amount equivalent to 8,000 orchid leis
supplied at every price. Using this new information, indicate the following:
-Quantity supplied at a price of $5:___
thousand
-Quantity supplied at a price of $10:___
thousand
-Quantity supplied at a price of $15:___
thousand
-The new equilibrium price is ____
per lei, and the new equilibrium quantity is
___thousand.
-Quantity supplied at a price of $5: 8
thousand
-Quantity supplied at a price of $10: 12
thousand
-Quantity supplied at a price of $15: 16
thousand
-The new equilibrium price is
$10
per lei, and the new equilibrium quantity is
12
thousand.
- foto de graph
Using the table above, which of the following graphs best illustrates the market
equilibrium?
a
b
c
d
A) intersection @(12,10)
Why does an effective price ceiling appear below the equilibrium rather than
above it?
A price ceilingis only effective when it is equal to the market equilibrium price.is
, only effective when it is low enough to restrict increases in the market price.and
its effectiveness are not at all associated with equilibrium.is only effective when it
is high enough to restrict decreases in the market price.
is only effective when it is low enough to restrict increases in the market price.
Suppose the federal government reduces an effective price floor toward the
equilibrium price but not below it. What will happen to the deadweight loss
-The deadweight loss will
remain unchanged.decrease.increase.become negative.
decrease
Suppose the federal government reduces an effective price floor toward the
equilibrium price but not below it. What will happen to the total surplus?
-The total surplus will
become negative.
increase.
remain unchanged.
decrease.
increase
Which of the following situations could be considered examples of price
gouging?
a. A deadly tornado strikes Oklahoma City, destroying the homes of 50% of its
population. Immediately afterward the price of sleeping bags increases by 150%
price gouging
The exchange rate between U.S. dollars and the Papua New Guinea kina
increases sharply as the Summer Olympics in Paris, France, approach.
not ptice gougning
A new model of sunglasses become the hottest overnight fashion trend after
several movie stars wear them to the Academy Awards. As a result, producers
increase their price by 300%.
not price gouging
At what level would you expect prices to settle during a period of price gouging?
The price would settle____
the pre-gouging market price.
above
In cities around the country, the government provides assistance to families with
low incomes to rent apartments at prices capped by the U.S. Department of
Housing and Urban Development (HUD), essentially setting a price ceiling on
apartments. The designated apartments tend to rent quickly, and tenants are less
likely to move once they find an apartment.
Assume the price ceiling is set below market equilibrium and no government
subsidies are offered to landlords.
What are the most likely outcomes in terms of availability of rent-controlled
apartments and ongoing maintenance of rent-controlled apartments?
The price ceiling will cause a shortage of rent-controlled apartments and the
rent-controlled apartments will be less well maintained than apartments without rent
controls.
Answers, Updaterd Fall 2023, With Complete
Verified Solution 100%
If a strong economic recovery boosts average incomes, what would happen to
the equilibrium price and quantity of a normal good and of an inferior good?
The equilibrium price and quantityof a normal good would rise; those of an
inferior good would also rise.of a normal good would rise; those of an inferior
good would fall.of a normal good would fall; those of an inferior good would
rise.of a normal good would fall; those of an inferior good would also fall.
of a normal good would rise; those of an inferior good would fall.
Which can cause a shift in the demand curve?
A change in
the price of a good
one of the determinants of demand
the technology used by firms
the cost of production
one of the determinants of demand
Holding everything else constant, producers are willing to offer more units for
sale when the price at which they can sell their product increases.
This concept is known as the
profit-maximizing condition.
law of supply.
maximal output.
law of one price.
law of supply.
Which of the items is most likely to be a complement to coffee?
tea
decaf coffee
baked beans
creamer
creamer
Assume that a monsoon destroys the coffee crop in Vietnam, one of the world's
largest coffee producers. What will likely occur?
The price of sugar and creamer will increase.
Consumers will try to find alternatives to coffee due to increases in the price of
coffee.
People will consume more coffee.
There will be no change in the market for coffee.
Consumers will try to find alternatives to coffee due to increases in the price of coffee.
From an economic context, select the correct definition of a market.an institution
that brings together buyers and sellers of goods or servicesthe process of using
advertising to convince potential buyers to purchase a producta place where
,groceries and other household items are bought and soldan institution where
stocks or bonds are purchased
an institution that brings together buyers and sellers of goods or services
Select all examples of a market.
a local farmer's market
the free-agent signing period in the NFL where players hoping to sign with a team
interact with teams looking for additional players
the New York Stock Exchange
Trader Joe's: a grocery store frequented by "foodie" types
all of theh above
Which can cause a shift in the demand curve?
A change in
the cost of production
the price of a good
the technology used by firms
one of the determinants of demand
one of the determinants of demand
Which of the choices illustrates the law of demand?
Pat
wants to buy more candy bars at $2 than at $1.
None of the choices.
wants to buy more candy bars at $1 than at $2.
offers more candy bars for sale at $2 than at $1.
wants to buy more candy bars at $1 than at $2.
Holding everything else constant, producers are willing to offer more units for
sale when the price at which they can sell their product increases.
This concept is known as thelaw of one price.law of supply.maximal output.profit-
maximizing condition.
law of supply.
Suppose that there has been a sudden influx of refugees in the small town of
Dallon, leading to a doubling of the local population. The accompanying graph
depicts Dallon's market for food. Adjust the graph to show the immediate impact
that this rise in population has on the food market. Then determine what happens
to equilibrium price and quantity.
-Equilibrium price
decreases.
increases.
may increase or decrease, but it is impossible to know for sure.
remains constant.
increase
Suppose that there has been a sudden influx of refugees in the small town of
Dallon, leading to a doubling of the local population. The accompanying graph
depicts Dallon's market for food. Adjust the graph to show the immediate impact
that this rise in population has on the food market. Then determine what happens
to equilibrium price and quantity.
,-Equilibrium quantity
increases.
may increase or decrease, but it is impossible to now for sure.
decreases.
remains constant.
increase
According to the law of demand,
a decrease in price increases quantity demanded.
- mirar foto de graph
The accompanying table gives the supply and demand for orchid leis in Hawaii.
Now assume that severe monsoons and civil unrest in Thailand lead to a
reduction in orchid production by an amount equivalent to 8,000 orchid leis
supplied at every price. Using this new information, indicate the following:
-Quantity supplied at a price of $5:___
thousand
-Quantity supplied at a price of $10:___
thousand
-Quantity supplied at a price of $15:___
thousand
-The new equilibrium price is ____
per lei, and the new equilibrium quantity is
___thousand.
-Quantity supplied at a price of $5: 8
thousand
-Quantity supplied at a price of $10: 12
thousand
-Quantity supplied at a price of $15: 16
thousand
-The new equilibrium price is
$10
per lei, and the new equilibrium quantity is
12
thousand.
- foto de graph
Using the table above, which of the following graphs best illustrates the market
equilibrium?
a
b
c
d
A) intersection @(12,10)
Why does an effective price ceiling appear below the equilibrium rather than
above it?
A price ceilingis only effective when it is equal to the market equilibrium price.is
, only effective when it is low enough to restrict increases in the market price.and
its effectiveness are not at all associated with equilibrium.is only effective when it
is high enough to restrict decreases in the market price.
is only effective when it is low enough to restrict increases in the market price.
Suppose the federal government reduces an effective price floor toward the
equilibrium price but not below it. What will happen to the deadweight loss
-The deadweight loss will
remain unchanged.decrease.increase.become negative.
decrease
Suppose the federal government reduces an effective price floor toward the
equilibrium price but not below it. What will happen to the total surplus?
-The total surplus will
become negative.
increase.
remain unchanged.
decrease.
increase
Which of the following situations could be considered examples of price
gouging?
a. A deadly tornado strikes Oklahoma City, destroying the homes of 50% of its
population. Immediately afterward the price of sleeping bags increases by 150%
price gouging
The exchange rate between U.S. dollars and the Papua New Guinea kina
increases sharply as the Summer Olympics in Paris, France, approach.
not ptice gougning
A new model of sunglasses become the hottest overnight fashion trend after
several movie stars wear them to the Academy Awards. As a result, producers
increase their price by 300%.
not price gouging
At what level would you expect prices to settle during a period of price gouging?
The price would settle____
the pre-gouging market price.
above
In cities around the country, the government provides assistance to families with
low incomes to rent apartments at prices capped by the U.S. Department of
Housing and Urban Development (HUD), essentially setting a price ceiling on
apartments. The designated apartments tend to rent quickly, and tenants are less
likely to move once they find an apartment.
Assume the price ceiling is set below market equilibrium and no government
subsidies are offered to landlords.
What are the most likely outcomes in terms of availability of rent-controlled
apartments and ongoing maintenance of rent-controlled apartments?
The price ceiling will cause a shortage of rent-controlled apartments and the
rent-controlled apartments will be less well maintained than apartments without rent
controls.
