Economics Unit 2 Exam Review

Veronica has been wearing a popular perfume for several years, and recently the price increased by $10. How will the price likely affect the quantity demanded and supplied?

• Supply will decrease, demand will increase.

• Supply will increase, and demand will decrease.

• Supply will increase, and demand will stay the same.

• Supply will stay the same, demand will increase.

What must you have in order to have demand?

• Ability, willingness, and desire to buy a product.

• Desire and willingness to buy a product.

• Insistence that you should own the product.

• Right to own a product.

The law of demand states that:

• Consumers buy less at lower prices.

• Consumers do not respond to price changes.

• Consumers will buy more at lower prices.

• Sellers will offer more to the market at high prices.

When Economists say that "the demand for apples has decreased", it means that:

• At any price, the quantity of apples demanded has fallen.

• At any quantity demanded, the price of apples have risen.

• Higher prices will result in an increase in the quantity of apples demanded.

• The demand curve for apples has shifted to the right.

The price of airline flights increased recently. Some economists suggest that the price increased because there has been an increase in the number of business travelers. If they are correct, it must be the case that...

• Demand decreased

• Demand increased

• Supply increased

• Supply decreased

If the market for corn is in equilibrium:

• All consumers of corn receive the same quantity of corn.

• All producers of corn earn the same amount of income form the sale of corn.

• Every producer who sells corn can do so

• The price is at a level where the quantity of corn supplied is equal to the quantity of corn demanded.

A maximum price set below the equilibrium price is a:

• Demand price

• Price ceiling

• Price floor

• Supply price

A price that the government guarantees farmer will receive for a particular crop is a:

• Excise tax

• Export price

• Price ceiling

• Price floor

Which market structure has only one producer of a good or service?

• Monopoly

• Perfect competition

• Oligopoly

• Monopolistic competition

Market structure in which there are thousands of producers of exactly the same thing, like strawberries and apples:

• Monopoly

• Oligopoly

• Perfect competition

• Monopolistic competition