Unit 2: SSEMI2

A Fruit Shake Company just upgraded its capital equipment by buying a machine that makes fruit shakes faster and cheaper than the original machine. What effect should this have on the graph?

• price rises, quantity rises
• price drops, quantity rises
• price rises, quantity drops
• price drops, quantity drops

Organizers of many high-interest sporting events such as the Super Bowl and World Cup set prices lower than equilibrium price. This would result in....

• a price ceiling, creating a ticket surplus
• a price ceiling, creating a ticket shortage
• a price floor, creating a ticket shortage
• a price floor, creating a ticket surplus

The principle that consumers tend to buy less of a good or service when its price increases, all else held equal, is called 

• the law of supply
• the law of demand
• the law of increasing costs
• the law of maximum satisfaction

If there is an increase in income for the households in this market, what is the MOST LIKELY result? 

• The equilibrium price will fall
• The demand curve will shift to the left
• The demand curve will shift to the right 
• The supply curve will become a vertical line 

According to the graph, what is the equilibrium price of movie tickets?

• $10
• $600
• $14
• $20

If the price of a good increases, the quantity demanded by consumers and the quantity supplied by producers will change in which of the following ways?

• Quantity demanded increases, quantity supplied increases
• quantity demanded increases, quantity supplied decreases
• quantity demanded decreases, quantity supplied increases
• quantity demanded decreases, quantity supplied increases

Of the following, which situation could cause the shift of the demand curve from D1 to D2 in the graph above?

• Yogurt prices rise due to a milk shortage.
• Yogurt prices fall due to a milk surplus.
• A new health report says that yogurt makes you sick.
• A new health report says that yogurt keeps you healthy. 

Which factor might cause an increase in the supply of a product? 

• A decrease in productivity 
• Fewer sellers in the marketplace
• An increase in worker's training
• An increase in the cost of raw materials 

Suppose that the government set the price of chocolate at $6 per pound. Which of the following statements best describes an effect of this price control? 

• There would be a surplus of 40 pounds of chocolate 
• Less chocolate would be demanded at $4 than at $6 
• Producers of chocolate would want the price set at $4 
• There would be a shortage of 20 pounds of chocolate 

In which of the following statements are the terms demand, supply, quantity demanded, and quantity supplied used correctly? 

• if the demand rises, supply rises 
• changes in demand and supply will not cause changes in the equilibrium price 
• changes in price decreases qu
• decreases in quantity demanded and quantity supplied often occur simultaneously