Question 1

Suppose that the equilibrium price in the market is $10. If the current market price is $7.50:

Accepted Answer

A)  the equilibrium price will fall to $7.50. 
B)  competition among buyers will increase the current price. 
C)  the current price will fall below $7.50 as sellers compete for market share. 
D)  There is not enough information provided to answer the question. 
A)  the equilibrium price will fall to $7.50. 
B)  competition among buyers will increase the current price. 
C)  the current price will fall below $7.50 as sellers compete for market share. 
D)  There is not enough information provided to answer the question.

Question 2

An increase in the quantity supplied results in:

Accepted Answer

A)  a shift of the supply curve to the left. 
B)  a shift of the supply curve to the right. 
C)  a movement upward and to the right along the supply curve. 
D)  a movement downward and to the left along the supply curve. 
A)  a shift of the supply curve to the left. 
B)  a shift of the supply curve to the right. 
C)  a movement upward and to the right along the supply curve. 
D)  a movement downward and to the left along the supply curve.

Question 3

After the recent financial crisis, new rules and regulations regarding mortgage lending made it more difficult for many families to purchase a home. Draw a supply and demand graph illustrating the impact of these new, harsher, mortgage-lending laws on the rental housing market. Predict what will happen to the price of rental housing as a result of these new laws.

Accepted Answer

The more stringent mortgage lending laws

Question 4

When there is an excess supply in the market, competition will:

Accepted Answer

A)  drive the price down to the equilibrium price. 
B)  drive the price up to the equilibrium price. 
C)  cause the demand curve to shift right. 
D)  cause the supply curve to increase. 
A)  drive the price down to the equilibrium price. 
B)  drive the price up to the equilibrium price. 
C)  cause the demand curve to shift right. 
D)  cause the supply curve to increase.

Question 5

Use the following to answer questions: Table: Equilibrium Price, Quantity $$\begin{array} { c c c } 
\hline \boldsymbol { P } & \boldsymbol { Q } _ { \mathbf { d } } & \boldsymbol { Q } _ { \mathbf { s } } \
\hline \$ 10 & 50 & 30 \
12 & 45 & 35 \
14 & 40 & 40 \
16 & 35 & 45 \
18 & 30 & 50 \
\hline
\end{array}$$
-(Table: Equilibrium Price, Quantity) Refer to the table. If the price in the market was $16, there would be a:

Accepted Answer

A)  shortage of 10 units. 
B)  shortage of 35 units. 
C)  surplus of 10 units. 
D)  surplus of 45 units. 
A)  shortage of 10 units. 
B)  shortage of 35 units. 
C)  surplus of 10 units. 
D)  surplus of 45 units.

Suppose that the equilibrium price in the market is $10. If the current market price is $7.50:

An increase in the quantity supplied results in:

When there is an excess supply in the market, competition will:

Use the following to answer questions: Table: Equilibrium Price, Quantity \ 10 50 30 12 45 35 14 40 40 16 35 45 18 30 50 -(Table: Equilibrium Price, Quantity) Refer to the table. If the price in the market was $16, there would be a:

The Big Ideas

The Power of Trade and Comparative Advantage

Supply and Demand

Price Ceilings and Floors

GDP and the Measurement of Progress

The Wealth of Nations and Economic Growth

Growth, Capital Accumulation and the Economics of Ideas: Catching up Vs the Cutting Edge

Saving, Investment, and the Financial System

Stock Markets and Personal Finance

Unemployment and Labor Force Participation

Inflation and the Quantity Theory of Money

Business Fluctuations: Aggregate Demand and Supply

Transmission and Amplification Mechanisms

The Federal Reserve System and Open Market Operations

Monetary Policy

The Federal Budget: Taxes and Spending

Fiscal Policy

International Trade

International Finance

Political Economy and Public Choice

Filters

Exam 4: Equilibrium: How Supply and Demand Determine Prices

Suppose that the equilibrium price in the market is $10. If the current market price is $7.50:

An increase in the quantity supplied results in:

When there is an excess supply in the market, competition will:

Use the following to answer questions: Table: Equilibrium Price, Quantity \ 10 50 30 12 45 35 14 40 40 16 35 45 18 30 50 -(Table: Equilibrium Price, Quantity) Refer to the table. If the price in the market was $16, there would be a:

The Big Ideas

The Power of Trade and Comparative Advantage

Supply and Demand

Price Ceilings and Floors

GDP and the Measurement of Progress

The Wealth of Nations and Economic Growth

Growth, Capital Accumulation and the Economics of Ideas: Catching up Vs the Cutting Edge

Saving, Investment, and the Financial System

Stock Markets and Personal Finance

Unemployment and Labor Force Participation

Inflation and the Quantity Theory of Money

Business Fluctuations: Aggregate Demand and Supply

Transmission and Amplification Mechanisms

The Federal Reserve System and Open Market Operations

Monetary Policy

The Federal Budget: Taxes and Spending

Fiscal Policy

International Trade

International Finance

Political Economy and Public Choice

Filters