TYPE LETTER ANSWER ONLY

1.What would happen in the market for smartphones if there was a significant improvement in the production technology used to make smartphones?

a. Equilibrium price would rise and equilibrium quantity would fall

b. Equilibrium price would fall and equilibrium quantity would rise

c. Equilibrium price and equilibrium quantity would both fall

d. Equilibrium price and equilibrium quantity would both rise

2.If the equilibrium price of a good rises but the equilibrium quantity of the good falls, which of the following best explains why?

a. The supply of the good increased

b. The demand for the good increased

c. The demand for the good decreased

d. The supply of the good decreased

3.As consumer incomes rise when the economy recovers after a recession, what happens in the market for normal goods, such as restaurant meals?

a. Equilibrium price and equilibrium quantity both fall

b. Equilibrium price and equilibrium quantity both rise

c. Equilibrium price rises and equilibrium quantity falls

d. Equilibrium price falls and equilibrium quantity rises

4.What would happen in the market for cocktails and other alcoholic beverages served at restaurants if the legal drinking age was lowered from 21 to 19?

a. Equilibrium price and equilibrium quantity would both fall

b. Equilibrium price and equilibrium quantity would both rise

c. Equilibrium price would fall and equilibrium quantity would rise

d. Equilibrium price would rise and equilibrium quantity would fall

5.In which pair below do both of the shifts have the same impact on equilibrium quantity?

a. A decrease in demand and an increase in supply

b. An increase in demand and a decrease in supply

c. A decrease in demand and a decrease in supply

d. An increase in demand and a decrease in demand

6.What would happen in the market for bicycles if the price of electric scooters (which are a substitute for bicycles) fell?

a. Equilibrium price would fall and equilibrium quantity would rise

b. Equilibrium price and equilibrium quantity would both fall

c. Equilibrium price and equilibrium quantity would both rise

d. Equilibrium price would rise and equilibrium quantity would fall

7.There will be a shortage of a good when:

a. the price is lower than the equilibrium price.

b. the quantity demanded is lower than the equilibrium quantity.

c. the price is higher than the equilibrium price.

d. the quantity supplied is higher than the equilibrium quantity.

8.Which of the following is in the CORRECT chronological order?

a. A change in demand, a change in price, a change in quantity supplied

b. A change in price, a change in demand, a change in quantity supplied

c. A change in demand, a change in quantity supplied, a change in price

d. A change in price, a change in quantity supplied, a change in demand

9.What would happen in the market for shoes if the price of leather (an input used to make shoes) were to rise?

a. Equilibrium price would rise and equilibrium quantity would fall

b. Equilibrium price would fall and equilibrium quantity would rise

c.Equilibrium price and equilibrium quantity would both rise

d. Equilibrium price and equilibrium quantity would both fall

10.Which of the following would have the same impact on the equilibrium price of a good as would an decrease in demand?

a. A decrease in supply

b. Simultaneous increases in both demand and supply

c. An increase in supply

d. Simultaneous decreases in both demand and supply

11.If the demand for a good increases (shifts to the right), what happens next?

a. The price falls and then the quantity supplied falls

b. The price falls and then the quantity supplied rises

c. The price rises and then the quantity supplied rises

d. The price rises and then the quantity supplied falls

12.Which of the following is in the CORRECT chronological order?

a. A change in supply, a change in quantity demanded, a change in price

b. A change in supply, a change in price, a change in quantity demanded

c. A change in price, a change in quantity demanded, a change in supply

d. A change in price, a change in supply, a change in quantity demanded

13.Tastes and preferences:

a. differ among consumers and can change over time.

b. determine whether demand curves slope upward or downward.

c. cannot be incorporated into economic models because they are random.

d. are assumed by economists to be relative stable.