1. Consumers believe an advert that claims that the price of orange juice soon will decrease significantly.Simultaneously, there is an outstanding Florida orange crop.The equilibrium price level will __________ and the equilibrium quantity level will __________.

Select one:

a. be indeterminate; become higher

b. become lower; be indeterminate

c. be indeterminate; become lower

d. become higher; be indeterminate

2. There is a surplus in the market for lettuce.We would expect

Select one:

a. the quantity supplied to increase.

b. the quantity demanded to decrease.

c. the demand to increase.

d. the price to decrease.

3. To study the effect of a change in the price of coffee on the quantity of coffee demanded, we must hold constant

Select one:

a. the quantity demanded of coffee.

b. both the price and the quantity demanded of coffee.

c. everything except the price and the quantity demanded of coffee.

d. the price of coffee.

4. An effective price floor is set _______ the equilibrium price and results in a _________.

Select one:

a. above; shortage

b. below; surplus

c. below; shortage

d. above; surplus

5. Which of the following will decrease the demand for OkraCoke?

Select one:

a. An increase in income (if OkraCoke is a normal good).

b. A decrease in the price of OkraCoke.

c. An expected increase in the price of OkraCoke.

d. An increase in the supply of PensaCola (a substitute for OkraCoke).