C211 SECOND OA QUIZZES
Equilibrium quantity must decrease when demand
a. increases and supply does not change, when demand does not change and supply
decreases, and when both demand and supply decrease.
b. decreases and supply does not change, when demand does not change and supply
increases, and when both demand and supply decrease.
c. decreases and supply does not change, when demand does not change and supply
decreases, and when both demand and supply decrease.
d. increases and supply does not change, when demand does not change and supply
increases, and when both demand and supply decrease. - Answer- c. decreases and
supply does not change, when demand does not change and supply decreases, and
when both demand and supply decrease.
If the demand for a product increases, then we would expect equilibrium price
a. to decrease and equilibrium quantity to increase.
b. and equilibrium quantity both to decrease.
c. to increase and equilibrium quantity to decrease.
d. and equilibrium quantity both to increase. - Answer- d. and equilibrium quantity both
to increase.
Suppose that demand for a good increases and, at the same time, supply of the good
decreases. What would happen in the market for the good?
a. Equilibrium price would decrease, but the impact on equilibrium quantity would be
ambiguous.
b. Equilibrium quantity would decrease, but the impact on equilibrium price would be
ambiguous.
c. Equilibrium quantity would increase, but the impact on equilibrium price would be
ambiguous.
d. Equilibrium price would increase, but the impact on equilibrium quantity would be
ambiguous. - Answer- d. Equilibrium price would increase, but the impact on equilibrium
quantity would be ambiguous.
Cross-price elasticity of demand measures how
a. the quantity demanded of one good changes in response to a change in the price of
another good.
b. the quantity demanded of one good changes in response to a change in the quantity
demanded of another good.
c. strongly normal or inferior a good is.
d. the price of one good changes in response to a change in the price of another good. -
Answer- a. the quantity demanded of one good changes in response to a change in the
price of another good.
The price elasticity of supply measures how much
a. the price of the good responds to changes in supply.
, b. sellers respond to changes in technology.
c. the quantity supplied responds to changes in the price of the good.
d. the quantity supplied responds to changes in input prices. - Answer- c. the quantity
supplied responds to changes in the price of the good.
The price elasticity of demand measures
a. the movement along a supply curve when there is a change in demand.
b. how much more of a good consumers will demand when incomes rise.
c. buyers' responsiveness to a change in the price of a good.
d. the extent to which demand increases as additional buyers enter the market. -
Answer- c. buyers' responsiveness to a change in the price of a good.
Which of the following is not a determinant of the price elasticity of demand for a good?
a. The time horizon
b. The definition of the market for the good
c. The steepness or flatness of the supply curve for the good
d. The availability of substitutes for the good - Answer- c. The steepness or flatness of
the supply curve for the good
If the price of walnuts rises, many people would switch from consuming walnuts to
consuming pecans. But if the price of salt rises, people would have difficulty purchasing
something to use in its place. These examples illustrate the importance of
a. a necessity versus a luxury in determining the price elasticity of demand.
b. the definition of a market in determining the price elasticity of demand.
c. the availability of close substitutes in determining the price elasticity of demand.
d. the time horizon in determining the price elasticity of demand. - Answer- c. the
availability of close substitutes in determining the price elasticity of demand
When the Fed decreases the discount rate, banks will
a. borrow less from the Fed and lend less to the public. The money supply decreases.
b. borrow more from the Fed and lend more to the public. The money supply increases.
c. borrow less from the Fed and lend more to the public. The money supply increases.
d. borrow more from the Fed and lend less to the public. The money supply decreases.
- Answer- b. borrow more from the Fed and lend more to the public. The money supply
increases.
Other things the same, if reserve requirements are increased, the reserve ratio
a. decreases, the money multiplier decreases, and the money supply increases.
b. increases, the money multiplier increases, and the money supply increases.
c. increases, the money multiplier decreases, and the money supply decreases.
d. decreases, the money multiplier increases, and the money supply increases. -
Answer- c. increases, the money multiplier decreases, and the money supply
decreases.
Which of the following policies can the Fed follow to increase the money supply?
a.
Equilibrium quantity must decrease when demand
a. increases and supply does not change, when demand does not change and supply
decreases, and when both demand and supply decrease.
b. decreases and supply does not change, when demand does not change and supply
increases, and when both demand and supply decrease.
c. decreases and supply does not change, when demand does not change and supply
decreases, and when both demand and supply decrease.
d. increases and supply does not change, when demand does not change and supply
increases, and when both demand and supply decrease. - Answer- c. decreases and
supply does not change, when demand does not change and supply decreases, and
when both demand and supply decrease.
If the demand for a product increases, then we would expect equilibrium price
a. to decrease and equilibrium quantity to increase.
b. and equilibrium quantity both to decrease.
c. to increase and equilibrium quantity to decrease.
d. and equilibrium quantity both to increase. - Answer- d. and equilibrium quantity both
to increase.
Suppose that demand for a good increases and, at the same time, supply of the good
decreases. What would happen in the market for the good?
a. Equilibrium price would decrease, but the impact on equilibrium quantity would be
ambiguous.
b. Equilibrium quantity would decrease, but the impact on equilibrium price would be
ambiguous.
c. Equilibrium quantity would increase, but the impact on equilibrium price would be
ambiguous.
d. Equilibrium price would increase, but the impact on equilibrium quantity would be
ambiguous. - Answer- d. Equilibrium price would increase, but the impact on equilibrium
quantity would be ambiguous.
Cross-price elasticity of demand measures how
a. the quantity demanded of one good changes in response to a change in the price of
another good.
b. the quantity demanded of one good changes in response to a change in the quantity
demanded of another good.
c. strongly normal or inferior a good is.
d. the price of one good changes in response to a change in the price of another good. -
Answer- a. the quantity demanded of one good changes in response to a change in the
price of another good.
The price elasticity of supply measures how much
a. the price of the good responds to changes in supply.
, b. sellers respond to changes in technology.
c. the quantity supplied responds to changes in the price of the good.
d. the quantity supplied responds to changes in input prices. - Answer- c. the quantity
supplied responds to changes in the price of the good.
The price elasticity of demand measures
a. the movement along a supply curve when there is a change in demand.
b. how much more of a good consumers will demand when incomes rise.
c. buyers' responsiveness to a change in the price of a good.
d. the extent to which demand increases as additional buyers enter the market. -
Answer- c. buyers' responsiveness to a change in the price of a good.
Which of the following is not a determinant of the price elasticity of demand for a good?
a. The time horizon
b. The definition of the market for the good
c. The steepness or flatness of the supply curve for the good
d. The availability of substitutes for the good - Answer- c. The steepness or flatness of
the supply curve for the good
If the price of walnuts rises, many people would switch from consuming walnuts to
consuming pecans. But if the price of salt rises, people would have difficulty purchasing
something to use in its place. These examples illustrate the importance of
a. a necessity versus a luxury in determining the price elasticity of demand.
b. the definition of a market in determining the price elasticity of demand.
c. the availability of close substitutes in determining the price elasticity of demand.
d. the time horizon in determining the price elasticity of demand. - Answer- c. the
availability of close substitutes in determining the price elasticity of demand
When the Fed decreases the discount rate, banks will
a. borrow less from the Fed and lend less to the public. The money supply decreases.
b. borrow more from the Fed and lend more to the public. The money supply increases.
c. borrow less from the Fed and lend more to the public. The money supply increases.
d. borrow more from the Fed and lend less to the public. The money supply decreases.
- Answer- b. borrow more from the Fed and lend more to the public. The money supply
increases.
Other things the same, if reserve requirements are increased, the reserve ratio
a. decreases, the money multiplier decreases, and the money supply increases.
b. increases, the money multiplier increases, and the money supply increases.
c. increases, the money multiplier decreases, and the money supply decreases.
d. decreases, the money multiplier increases, and the money supply increases. -
Answer- c. increases, the money multiplier decreases, and the money supply
decreases.
Which of the following policies can the Fed follow to increase the money supply?
a.
