ECON 102 QUESTIONS AND ANSWERS LATEST UPDATED
VERSION, GRADED A+.
Since deregulation, air-fares have declined by 30 percent. Deregulation is an example of political
forces:
letting the market move towards equilibrium, reducing excess supply.
For which of the following markets would the fallacy of composition most likely apply?
labor market
Which statement is not consistent with the law of supply?
Quantity supplied of a good is inversely related to the good's price.
In a market where there are strong social and political forces:
quantity demanded might not equal quantity supplied.
Suppose OPEC announces that it will increase production. Using supply and demand analysis to
predict the effect of increased production on equilibrium price and quantity, the first step is to show
the:
supply curve shifting to the right.
If Argentina imposes a 20 percent tax on natural gas exports to be paid by suppliers. Other things
equal, this causes the:
supply of natural gas exports shifts to the left
The theory that quantity supplied and price are positively related, other things constant, is referred to
as the law of:
supply
The distinction between demand and the quantity demanded is best made by saying that:
demand is represented graphically by a curve and quantity demanded as a point on that curve.
If supply and demand intersect at a price of $5.00, then a reduction in price from $6.00 to $5.00 will
cause an increase in quantity:
demanded, a decrease in quantity supplied, and the alleviation of a surplus.
Suppose farmers can use their land to grow either wheat or corn. The law of supply predicts that an
increase in the market price of wheat will cause:
farmers to substitute wheat for the production of corn.
The fallacy of composition refers to the false assumption:
VERSION, GRADED A+.
Since deregulation, air-fares have declined by 30 percent. Deregulation is an example of political
forces:
letting the market move towards equilibrium, reducing excess supply.
For which of the following markets would the fallacy of composition most likely apply?
labor market
Which statement is not consistent with the law of supply?
Quantity supplied of a good is inversely related to the good's price.
In a market where there are strong social and political forces:
quantity demanded might not equal quantity supplied.
Suppose OPEC announces that it will increase production. Using supply and demand analysis to
predict the effect of increased production on equilibrium price and quantity, the first step is to show
the:
supply curve shifting to the right.
If Argentina imposes a 20 percent tax on natural gas exports to be paid by suppliers. Other things
equal, this causes the:
supply of natural gas exports shifts to the left
The theory that quantity supplied and price are positively related, other things constant, is referred to
as the law of:
supply
The distinction between demand and the quantity demanded is best made by saying that:
demand is represented graphically by a curve and quantity demanded as a point on that curve.
If supply and demand intersect at a price of $5.00, then a reduction in price from $6.00 to $5.00 will
cause an increase in quantity:
demanded, a decrease in quantity supplied, and the alleviation of a surplus.
Suppose farmers can use their land to grow either wheat or corn. The law of supply predicts that an
increase in the market price of wheat will cause:
farmers to substitute wheat for the production of corn.
The fallacy of composition refers to the false assumption:
