In Manhattan, where living space is in short supply, the city has enacted rent control, which limits the amount landlords can charge for rent. As a result,

the demand for apartments in rent-controlled areas far outstrips the supply.

Based on the laws of supply and demand, which situation would lead to a shortage? Options: Consumers are unwilling to pay for the product., Businesses are unwilling to reduce the inventory., The price of a product falls below the equilibrium price., The price of a product rises above the equilibrium price.

The price of a product falls below the equilibrium price.

If producers moved the price from p3 to p1

buyers would likely purchase fewer widgets.

While demand is based on consumer purchases, supply is most likely based on

the willingness of producers to supply a product.

Using the supply and demand curve, which statement is true? By decreasing the price from $3.50 (P1) to $1.60 (P2), supply decreases. By decreasing the price from $3.50 (P1) to $1.60 (P2), demand decreases. By decreasing the price from $3.50 (P1) to $1.60 (P2), the quantity of supply decreases. By decreasing the price from $3.50 (P1) to $1.60 (P2), the quantity of demand decreases.

By decreasing the price from $3.50 (P1) to $1.60 (P2), the quantity of supply decreases.

Which of these would most likely cause an increase in the price of an item? Options: declining popularity of the item, a decrease in the price of a substitute product, improved technology in the production of that item, an increase in the cost of raw materials for that item

an increase in the cost of raw materials for that item

Which statement accurately describes the contents of this graph? Options: At the equilibrium price, quantity supplied equals quantity demanded. At the equilibrium price, quantity supplied exceeds quantity demanded. When the price goes above the equilibrium price, quantity demanded increases. When the price goes below the equilibrium price, quantity supplied increases.

At the equilibrium price, quantity supplied equals quantity demanded.

If a new machine was developed that picked coffee beans twice as fast as is currently possible, what would you expect to happen to the price of coffee?

The price would decrease because there would be more coffee available.

If the price of the good represented by the graph increased from $5 to $10, which statement would be true?

The quantity demanded would decrease, and the quantity supplied would increase.

Which determinant might increase supply in the market? Options: an increase in the price of complementary goods, an increase in the number of sellers of a product, an increase in the number of consumers in the market, an increase in the price of inputs to make the product

an increase in the number of sellers of a product

The maker of wheat crackers found that increasing the price from $4.00 to $4.25 per box had no impact on demand, but increasing the price further to $4.50 reduced total demand. Thus, the demand for the wheat crackers is

inelastic up to $4.25, but elastic at $4.50.

Which statement about investment in education is best supported using the graphs? Options: More education leads to high demand, low supply.; More education leads to low demand, high supply.; The average annual wage decreases as the amount of education increases.; The average annual wage increases as the amount of education decreases.

More education leads to high demand, low supply.

What is the incentive to purchase a new, but older, version of the smartphone?

the lower price of the older version

Earnings of workers are typically increased by all of these except: a rising value of the goods produced, a larger profit margin of the company, a better efficiency of the production process.

a growing supply of available workers.

The new oven in Mr. Sauthoff's bakery allows him to produce bread more efficiently and more cheaply. What is the most likely effect for consumers?

the price drops and the quantity demanded increases

In an industry with several providers of a type of good, why can one business not charge much higher prices for their goods?

Higher prices will encourage consumers to purchase substitute goods.

Demand for orange juice increases at the same time that the supply decreases. Which of these could explain that scenario? Consumers hear of the benefits of vitamin C contained in oranges, while citrus farmers suffer from a severe frost.

Consumers hear of the benefits of vitamin C contained in oranges, while citrus farmers suffer from a severe frost.

Consumers are told that the consumption of cauliflower will significantly reduce the risk of cancer. Which of these scenarios is likely to happen in the cauliflower market?

The demand curve will shift to the right and the price of cauliflower will rise.

In a market economy, a high price will usually cause

producers to supply more and consumers to buy less.

If you wanted to start a new business that rents sun-shielding umbrellas to tourists, which of these risks would be most important to consider?

The weather may not call for umbrellas.

Higher interest rates and higher taxes would have which of these effects on the aggregate supply and aggregate demand curves?

Both the aggregate supply and aggregate demand curves would shift to the left.

Bert is vacationing in New York and decides to buy a whoopee cushion. He is amazed at the price of $8.00. He knows that the same item costs only $5.00 back in Springtown. This price difference is probably due to

higher business costs in New York.

One reason that government regulation of natural monopolies is essential is

to prevent the monopoly from raising prices uncontrollably.

For an industry to be perfectly competitive, what must exist? Options: there are no competitive markets, many firms selling identical items, many firms selling different items, many consumers wanting different items

many firms selling identical items

Why is there no competition in a monopoly?

There are no close substitutes.

Which scenario best represents monopolistic competition? Options: Two new restaurants open to compete with a national food chain. Two firms compete against each other to sell pearls in an urban market. A family decides to stay at specific hotel on vacation because it has a swimming pool with a slide. A company wins a contract to be the sole provider of phone and cable television service for a city.

A family decides to stay at specific hotel on vacation because it has a swimming pool with a slide.

On a supply and demand graph, if the demand curve shifts to the left, what would be the resulting effect on equilibrium price and quantity?

price will fall and quantity will fall

What might be the reason for the shift of the aggregate supply curve from AS to AS1? Options: an increase in production by OPEC, a decrease in overall wages, an increase in stock prices, an increase in raw material prices

an increase in raw material prices

During a natural disaster, such as a hurricane, if the government enacts price controls (such as anti-gouging rules), what will most likely result?

Rooms will be hard or impossible to find.

Economics Standard 3: 2020 Practice

Flashcard

•

Social Studies

•

9th - 12th Grade

•

Practice Problem

•

Hard

Wayground Content

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59 questions

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FLASHCARD QUESTION

Front

In the graph, what information is determined by looking at the intersection of the supply and demand curves?

Back

equilibrium price

FLASHCARD QUESTION

Front

A volcano erupts in Hawaii that destroys or severely damages many of the pineapple orchards located there. What will be the effect on price and quantity of pineapples sold?

Back

price will rise and quantity will fall

FLASHCARD QUESTION

Front

If the Organization of the Petroleum Exporting Countries (OPEC) decided to cut oil production for the coming year, what would be the most likely effect?

Back

oil prices would probably rise

FLASHCARD QUESTION

Front

The purpose of the graph is to show: a good's equilibrium price, labor required for a project, changes in the demand for a product, production possibilities with available resources

Back

changes in the demand for a product

FLASHCARD QUESTION

Front

Which statement accurately reflects how the workers’ earnings are determined in the graph? Options: The janitors have a lower wage than the surgeons. The surgeons have higher productivity than the janitors. The demand for surgeons is greater than the supply, pushing up wages. The demand for janitors is greater than the supply, ensuring low wages.

Back

The demand for surgeons is greater than the supply, pushing up wages.

FLASHCARD QUESTION

Front

What will happen to the price of candy on November 1, if there were a huge storm in the area and it didn't allow for shopping in the days leading up to (and the day of) Halloween?

Back

The price would fall to move the excess supply of candy.

FLASHCARD QUESTION

Front

What would be the situation if the price was moved from p2 to p3?

Back

there would be a shortage of widgets

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