Question 1

Which of the following is most likely to benefit from government established price floors in agriculture?

Accepted Answer

A) large farm owners and corporate farms 
B) small farmers 
C) cattle ranchers 
D) low income farmers 
A) large farm owners and corporate farms 
B) small farmers 
C) cattle ranchers 
D) low income farmers

Question 2

Holding demand constant,an increase in supply leads to

Accepted Answer

A) lower prices and higher quantity demanded. 
B) lower prices and lower quantity demanded. 
C) higher prices and higher quantity demanded. 
D) higher prices and lower quantity demanded. 
A) lower prices and higher quantity demanded. 
B) lower prices and lower quantity demanded. 
C) higher prices and higher quantity demanded. 
D) higher prices and lower quantity demanded.

Question 3

Market clearing prices in a market system act as

Accepted Answer

A) a signaling device. 
B) a direct measure of resource costs. 
C) a way for producers to advertise. 
D) a legally determined rationing device. 
A) a signaling device. 
B) a direct measure of resource costs. 
C) a way for producers to advertise. 
D) a legally determined rationing device.

Question 4

An import quota is

Accepted Answer

A) a quantity restriction. 
B) a price ceiling. 
C) a price floor. 
D) something imposed on agricultural goods grown by American farmers. 
A) a quantity restriction. 
B) a price ceiling. 
C) a price floor. 
D) something imposed on agricultural goods grown by American farmers.

Question 5

An effective government imposed price ceiling will result

Accepted Answer

A) in a surplus on the market. 
B) in a shortage on the market. 
C) in additional revenue for the government. 
D) in prices for the product falling in the future. 
A) in a surplus on the market. 
B) in a shortage on the market. 
C) in additional revenue for the government. 
D) in prices for the product falling in the future.

Question 6

If both buyers and sellers expect the price of a commodity to rise in the future,it is likely that the market clearing price ________ and the equilibrium quantity ________.

Accepted Answer

A) will fall,cannot be predicted 
B) will rise,cannot be predicted 
C) cannot be predicted,will fall 
D) cannot be predicted,will rise 
A) will fall,cannot be predicted 
B) will rise,cannot be predicted 
C) cannot be predicted,will fall 
D) cannot be predicted,will rise

Question 7

-Refer to the above figure.Suppose that the supply curve shifts from SA to SB while the demand curve shifts from DA to DB.Which of the following is true about the results of the shifts in the supply and demand curves?

Accepted Answer

A) The equilibrium price increases while the equilibrium quantity remains unchanged. 
B) Both the equilibrium price and equilibrium quantity increase. 
C) The equilibrium price remains unchanged while the equilibrium quantity increases. 
D) Both the equilibrium price and equilibrium quantity remain unchanged. 
A) The equilibrium price increases while the equilibrium quantity remains unchanged. 
B) Both the equilibrium price and equilibrium quantity increase. 
C) The equilibrium price remains unchanged while the equilibrium quantity increases. 
D) Both the equilibrium price and equilibrium quantity remain unchanged.

Question 8

If the demand for a product falls and the supply stays the same,

Accepted Answer

A) the market clearing price will fall and the equilibrium quantity will rise. 
B) the market clearing price will rise and the equilibrium quantity will fall. 
C) both the market clearing price and the equilibrium quantity will fall. 
D) both the market clearing price and the equilibrium quantity will rise. 
A) the market clearing price will fall and the equilibrium quantity will rise. 
B) the market clearing price will rise and the equilibrium quantity will fall. 
C) both the market clearing price and the equilibrium quantity will fall. 
D) both the market clearing price and the equilibrium quantity will rise.

Question 9

In the market for domestic avocados,what would happen to the market clearing price and the equilibrium quantity if there was a drought in avocado growing areas?

Accepted Answer

A) The market clearing price would rise,and the equilibrium quantity would rise. 
B) The market clearing price would fall,and the equilibrium quantity would rise. 
C) The market clearing price would rise,and the equilibrium quantity would fall. 
D) The market clearing price would fall,and the equilibrium quantity would fall. 
A) The market clearing price would rise,and the equilibrium quantity would rise. 
B) The market clearing price would fall,and the equilibrium quantity would rise. 
C) The market clearing price would rise,and the equilibrium quantity would fall. 
D) The market clearing price would fall,and the equilibrium quantity would fall.

Question 10

Prices play a role in a market

Accepted Answer

A) because they distribute scarce goods to those consumers who value them most highly. 
B) because when prices are in equilibrium,product shortages or surpluses can occur. 
C) because they help eliminate poverty. 
D) because they eliminate scarcity. 
A) because they distribute scarce goods to those consumers who value them most highly. 
B) because when prices are in equilibrium,product shortages or surpluses can occur. 
C) because they help eliminate poverty. 
D) because they eliminate scarcity.

Question 11

An increase in the price of labor used to produce good Y will lead to

Accepted Answer

A) an increase in the market clearing price of good Y. 
B) an increase in the supply of good Y. 
C) a decrease in the demand for good Y. 
D) an increase in the demand for good Y. 
A) an increase in the market clearing price of good Y. 
B) an increase in the supply of good Y. 
C) a decrease in the demand for good Y. 
D) an increase in the demand for good Y.

Question 12

In the United States,government-imposed price supports are most often associated with

Accepted Answer

A) agricultural products. 
B) industrial products. 
C) consumer electronics. 
D) commercial building products. 
A) agricultural products. 
B) industrial products. 
C) consumer electronics. 
D) commercial building products.

Question 13

Price controls may be thought of as

Accepted Answer

A) a restraint on the rationing function of prices. 
B) useful tools that promote production. 
C) necessary in market economies. 
D) the freeing-up of free market forces. 
A) a restraint on the rationing function of prices. 
B) useful tools that promote production. 
C) necessary in market economies. 
D) the freeing-up of free market forces.

Question 14

Using a graph,show a market equilibrium.Suppose the costs of inputs increase.How is this shown on the graph? Explain what is happening in the market.

Accepted Answer

@#IMG-DLM& In the graph,the original equilibrium i

Question 15

Suppose the market clearing price for gasoline is $4.75 per gallon.Now suppose that policy makers pass a law requiring that the maximum price that can be charged is $3.75 per gallon.Such a situation is an example of

Accepted Answer

A) a price control that will lead to a surplus of gasoline on the market. 
B) a price floor that will lead to a shortage of gasoline on the market. 
C) a price ceiling that will lead to a shortage of gasoline on the market. 
D) a price floor that will lead to a surplus of gasoline on the market. 
A) a price control that will lead to a surplus of gasoline on the market. 
B) a price floor that will lead to a shortage of gasoline on the market. 
C) a price ceiling that will lead to a shortage of gasoline on the market. 
D) a price floor that will lead to a surplus of gasoline on the market.

Question 16

Garbanzo Beans $$\begin{array} { l c c } 
\text { Price } & \mathbf { Q } _ { \mathbf { d } } & \mathbf { Q } _ { \mathbf { s } } \
\hline \$ 2 & 5,000 & 1,000 \
\$ 4 & 4,000 & 2,000 \
\$ 6 & 3,000 & 3,000 \
\$ 8 & 2,000 & 4,000 \
\$ 10 & 1,000 & 5,000
\end{array}$$
-Consider the above table.Assuming the government imposes a price ceiling on garbanzo beans of $4,what would be the likely result?

Accepted Answer

A) a surplus of 2,000 garbanzo beans 
B) a shortage of 2,000 garbanzo beans 
C) no change,equilibrium would prevail 
D) The quantity demanded of garbanzo beans would fall to zero. 
A) a surplus of 2,000 garbanzo beans 
B) a shortage of 2,000 garbanzo beans 
C) no change,equilibrium would prevail 
D) The quantity demanded of garbanzo beans would fall to zero.

Question 17

The price of labor in the agricultural industry has just increased.For agricultural products,this will lead to

Accepted Answer

A) an increase in price and a decrease in quantity. 
B) an increase in price and an increase in quantity. 
C) a decrease in price and a decrease in quantity. 
D) a decrease in price and an increase in quantity. 
A) an increase in price and a decrease in quantity. 
B) an increase in price and an increase in quantity. 
C) a decrease in price and a decrease in quantity. 
D) a decrease in price and an increase in quantity.

Question 18

When producers would have been willing to accept lower prices at various quantities produced than the market clearing price,the differences are called

Accepted Answer

A) producer surplus. 
B) monopoly profits. 
C) opportunity cost. 
D) deadweight loss. 
A) producer surplus. 
B) monopoly profits. 
C) opportunity cost. 
D) deadweight loss.

Question 19

A market in which a price-controlled good is sold at an illegally high price is known as

Accepted Answer

A) a flooring market. 
B) a ceiling market. 
C) a black market. 
D) a supermarket. 
A) a flooring market. 
B) a ceiling market. 
C) a black market. 
D) a supermarket.

Which of the following is most likely to benefit from government established price floors in agriculture?

Holding demand constant,an increase in supply leads to

Market clearing prices in a market system act as

An import quota is

An effective government imposed price ceiling will result

If both buyers and sellers expect the price of a commodity to rise in the future,it is likely that the market clearing price and the equilibrium quantity .

-Refer to the above figure.Suppose that the supply curve shifts from S_A to S_B while the demand curve shifts from D_A to D_B.Which of the following is true about the results of the shifts in the supply and demand curves?

If the demand for a product falls and the supply stays the same,

In the market for domestic avocados,what would happen to the market clearing price and the equilibrium quantity if there was a drought in avocado growing areas?

Prices play a role in a market

An increase in the price of labor used to produce good Y will lead to

In the United States,government-imposed price supports are most often associated with

Price controls may be thought of as

Using a graph,show a market equilibrium.Suppose the costs of inputs increase.How is this shown on the graph? Explain what is happening in the market.

Suppose the market clearing price for gasoline is $4.75 per gallon.Now suppose that policy makers pass a law requiring that the maximum price that can be charged is $3.75 per gallon.Such a situation is an example of

Garbanzo Beans Price \ 2 5,000 1,000 \ 4 4,000 2,000 \ 6 3,000 3,000 \ 8 2,000 4,000 \ 10 1,000 5,000 -Consider the above table.Assuming the government imposes a price ceiling on garbanzo beans of $4,what would be the likely result?

The price of labor in the agricultural industry has just increased.For agricultural products,this will lead to

When producers would have been willing to accept lower prices at various quantities produced than the market clearing price,the differences are called

A market in which a price-controlled good is sold at an illegally high price is known as

The Nature of Economics

Scarcity and the World of Trade-Offs

Demand and Supply

Public Spending and Public Choice

Funding the Public Sector

Demand and Supply Elasticity

Consumer Choice

Rents, profits, and the Financial Environment of Business

The Firm: Cost and Output Determination

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly and Strategic Behavior

Regulation and Antitrust Policy in a Globalized Economy

The Labor Market: Demand, supply and Outsourcing

Unions and Labor Market Monopoly Power

Income, poverty, and Health Care

Environmental Economics

Comparative Advantage and the Open Economy

Exchange Rates and the Balance of Payments

Filters

Exam 3: Extensions of Demand and Supply Analysis

Which of the following is most likely to benefit from government established price floors in agriculture?

Holding demand constant,an increase in supply leads to

Market clearing prices in a market system act as

An import quota is

An effective government imposed price ceiling will result

If both buyers and sellers expect the price of a commodity to rise in the future,it is likely that the market clearing price ________ and the equilibrium quantity ________.

-Refer to the above figure.Suppose that the supply curve shifts from SA to SB while the demand curve shifts from DA to DB.Which of the following is true about the results of the shifts in the supply and demand curves?

If the demand for a product falls and the supply stays the same,

In the market for domestic avocados,what would happen to the market clearing price and the equilibrium quantity if there was a drought in avocado growing areas?

Prices play a role in a market

An increase in the price of labor used to produce good Y will lead to

In the United States,government-imposed price supports are most often associated with

Price controls may be thought of as

Using a graph,show a market equilibrium.Suppose the costs of inputs increase.How is this shown on the graph? Explain what is happening in the market.

Suppose the market clearing price for gasoline is $4.75 per gallon.Now suppose that policy makers pass a law requiring that the maximum price that can be charged is $3.75 per gallon.Such a situation is an example of

Garbanzo Beans Price \ 2 5,000 1,000 \ 4 4,000 2,000 \ 6 3,000 3,000 \ 8 2,000 4,000 \ 10 1,000 5,000 -Consider the above table.Assuming the government imposes a price ceiling on garbanzo beans of $4,what would be the likely result?

The price of labor in the agricultural industry has just increased.For agricultural products,this will lead to

When producers would have been willing to accept lower prices at various quantities produced than the market clearing price,the differences are called

A market in which a price-controlled good is sold at an illegally high price is known as

The Nature of Economics

Scarcity and the World of Trade-Offs

Demand and Supply

Public Spending and Public Choice

Funding the Public Sector

Demand and Supply Elasticity

Consumer Choice

Rents, profits, and the Financial Environment of Business

The Firm: Cost and Output Determination

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly and Strategic Behavior

Regulation and Antitrust Policy in a Globalized Economy

The Labor Market: Demand, supply and Outsourcing

Unions and Labor Market Monopoly Power

Income, poverty, and Health Care

Environmental Economics

Comparative Advantage and the Open Economy

Exchange Rates and the Balance of Payments

Filters

If both buyers and sellers expect the price of a commodity to rise in the future,it is likely that the market clearing price and the equilibrium quantity .

-Refer to the above figure.Suppose that the supply curve shifts from S_A to S_B while the demand curve shifts from D_A to D_B.Which of the following is true about the results of the shifts in the supply and demand curves?