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Unit 2 Test Review Flashcards | StudBud
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Unit 2 Test Review
Unit 2 Test Review
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Questions
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Answers
1
Which of the following will cause supply of a product to increase?
an increase in government regulations
a decrease in the price of resources
An increase in consumers incomes
an increase in business taxes
2
Which of the following will NOT shift the demand curve for beef?
an effective ad campaign by pork producers
a decrease in the price of beef
a widely publicized study that shows beef increases one's bad cholesteral
a change in the population
3
How is future prices related to current demand?
Future price is not related to current demand
If the future price is expected to increase, current demand will rise.
If current demand is expected to decrease, current demand will decrease too
If the future price is expected to increase, current demand will decrease
4
A market surplus occurs where _______________
There is excess supply
QS > QD
ALL of the above
The price has risen to a point consumers find unreasonable.
5
When the equilibrium price for a product is reached, there is a ____
Surplus
Neither
Shortage
6
The shift in supply or demand is illustrated by moving from one point on the curve to another point.
False
True
7
An increase in price causes an increase in supply.
True
False
8
Equilibrium price and quantity in a market are graphically found where _____________
The supply curve intersects the y axis
the supply and demand curves intersect
the demand curve intersects the y axis
the supply curve intersects the x axis
9
Which of the following is the best example of the law of supply?
Number of acres growing wheat increases
Number (quantity) of sandwhiches increases, price increases
A catering company buys a new dishwasher to make their work easier.
The price of gum goes up, supply stays the same
10
Which of the following will cause an increase in supply for DVD players?
a decrease in the price of DVD players.
A decrease in the number of producers making DVD players
An increase in the price of DVD players
A decrease in the wages for employees making DVD players.
11
Prices serve as a link between producers and _____________.
Natural Resources
Factors of Production
Consumers
Government
12
In relation to Column (1), a change from Column (2) to Column (3) would indicate a(n) ________
decrease in Supply
increase in Supply
equilibrium reached
a shortage was created
13
Demand is based on consumer purchase but supply is based on _________
offering a wide range of prices
the desire to purchase
the ability to purchase
Producers offering products for sale
14
All of the following are examples of complements EXCEPT
cameras and film
tea and coffee
flashlights and batteries
peanut butter and jelly
15
A situation in which prices are relatively stable and the quantity supplied is equal to the quantity demanded.
shortage
market equilibrium
economic model
surplus
16
A change in resource prices is a factor that will cause a change in supply.
False
True
17
If a competitive market is at equilibrium and there is a sudden increase in demand, then __________
a temporary shortage will occur and the price will rise
a temporary surplus will occur and the price will rise
a temporary shortage will occur and the price will fall
a temporary surplus will occur and the price will fall
18
If there is an increase in demand, what will happen to price and quantity of a good?
Price increases quantity decreases
Price increases, quantity increases
Price decreases, quantity decreases
Price decreases, quantity increases
19
Which of the following will cause an increase in the demand for digital cameras?
an increase in incomes
a decrease in incomes
an increase in the price of cameras
a decrease in the price of cameras
20
When the price of a product falls to a level that consumers consider a bargain, there will be a ________
Shortage
Neither
Surplus
21
If two goods are substitutes for each other, an increase in the price of one will ____________.
decrease the demand for the other good
increase the supply of the other good
have no effect on the other good
increase the demand for the other good
22
Surplus, Shortage, or Neither?"Bad weather reduces the expected harvest of a crop while demand remains constant."
Surplus
Neither
Shortage
23
Which of the following will cause the supply curve to shift to the left?
an improvement in technology
a decrease in resource prices
a decrease in consumer incomes
Firms or businesses leaving the industry
24
According to the law of demand, if the price of apples doubles and your salary remains the same, you would probably ___.
buy more complementary goods for apples
buy more apples
buy the same number of apples
buy fewer apples
25
An increase in demand causes the price of a product to fall.
False
True
26
A cold spell in Florida devastates the orange crop. California oranges increase in price. This causes...
The supply of California oranges decreases and prices increase
The demand for Florida oranges increased while the supply decreased.
Demand for Florida oranges foes down. Demand for California oranges goes up
Supply of Florida oranges decreases and the price increases.
27
When the price of a product rises to a level that consumers consider too high, there is a _____
Surplus
Shortage
Neither
28
Which of the following would generally cause an increase in the demand for automobiles?
An increase in consumers incomes
A decrease in the number of consumers
New technology for increasing automobile production
Quota being placed on automobiles
