Econ 101 » Spring 2020 » Module 3 Quiz

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Question #1
The downward slope of a demand curve illustrates the pattern that as ________ rises, ________ decreases.
A.   quantity supplied : quantity demanded
B.   price : quantity supplied
C.   price : quantity demanded
Question #2
Complete the following sentence: If people think that the price of electronics will increase in the near future, that belief may cause a(n)
A.   increase in the supply of electronics today.
B.   increase in the demand for electronics today.
C.   decrease in the price of electronics today.
Question #3
According to the law of demand, assuming other factors are held constant
A.   As the price of milk increases, the quantity of milk demanded will increase.
B.   As the price of milk decreases, the quantity of milk demanded will increase
C.   As the demand for milk increases, the price of milk will also increase
Question #4
According to the law of demand, assuming other factors are held constant
A.   as the price of bread increases, the quantity of bread demanded will increase.
B.   as the demand for bread increases, the price of bread will also increase.
C.   as the price of bread increases, the quantity of bread demanded will decrease.
Question #5
Information campaigns about tobacco hazards and taxes on tobacco are two ways to discourage its use. Which one decreases demand for smoking?
A.   The Tax on tobacco products that drives up its price
B.   The Information campaign on hazards of tobacco
C.   Both cause a decrease in demand
Question #6
Economists refer to the relationship that a higher price leads to a lower quantity demanded as the
A.   market equilibrium.
B.   law of demand.
C.   price and demand model.
Question #7
The following country has characteristics of a command economy?
A.   China
B.   United States
C.   Australia
Question #8
A market economy includes which following characteristic?
A.   There is no private property.
B.   Economic decision-making happens through markets
C.   Resources and businesses are owned by the government.
Question #9
If demand falls and supply remains constant, once the market has adjusted to its new equilibrium there will be
A.   fewer transactions, and they will take place at a higher price.
B.   more transactions, and they will take place at a lower price.
C.   fewer transactions, and they will take place at a lower price.
Question #10
The ________ is where quantity demanded and quantity supplied are equal at a certain price.
A.   equilibrium
B.   supply schedule
C.   surplus
Question #11
Excess supply occurs when the actual price in some market is ________ the equilibrium price.
A.   equal to
B.   below
C.   above
Question #12
In order to deal with a budget deficit, the city of Portland reduces its subsidy of doughnut shops. What happens in the market for doughnuts in Portland?,,
A.   The equilibrium quantity falls.
B.   The quantity supplied and the quantity demanded both rise.
C.   Doughnut prices rise.
Question #13
According to the law of supply, assuming other factors are held constant
A.   as the price of bread increases, the quantity of bread supplied will increase.
B.   as the supply for bread increases, the price of bread will also increase.
C.   as the price of bread increases, the quantity of bread supplied will decrease.
Question #14
A severe freeze has damaged the Florida orange crop. The impact on the market for orange juice will be a leftward shift of
A.   the demand curve.
B.   the supply curve.
C.   both the supply and demand curves.
Question #15
If a technology change reduces a company’s production costs, it will
A.   decrease consumer demand.
B.   increase consumer demand.
C.   shift the supply curve to the right.
Question #16
Which of the following would cause the supply curve to shift to the right?
A.   An improvement in technology
B.   An increase in production costs.
C.   An increase in the price of the product.
Question #17
Economists refer to the relationship that a higher price leads to a higher quantity supplied as the
A.   market equilibrium.
B.   price and supply model.
C.   law of supply
Question #18
Which of the following will cause the supply curve to shift to the right?
A.   lower product taxes
B.   poor natural conditions for production
C.   an increase in input prices

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