AP Microeconomics Unit 2 - Test Prep

The graph represents: Demand or Supply?

• Demand
• Supply

The Law of Supply states:

• as price increases, supply increases

• as prices increases, supply decreases

• as prices increases, quantity supplied increases

• as prices increases, quantity supplied decreases

When quantity supplied and quantity demanded is equal

• surplus
• shortage
• equilibrium
• law of demand

Thousands of people leave a small town due to a factory closing down.  Sales at the local grocery store become slow. What causes this change?

• Prices or availability of substitutes
• Prices or availability of complementary goods
• Change in the weather or season
• Change in the number of buyers

Goods that are bought and used together are 

• complementary goods
• substitute goods
• income goods
• unrelated goods

Which of the following is likely to increase the demand for peanut butter?

• Fewer children in the population
• News that insects have destroyed much of the peanut crop and that there will be less peanut butter on the shelves in three months.
• A big increase in the price of jelly.
• A report from the Surgeon General of the United States that eating peanut butter makes people nutty.

Which of the following will cause an increase in demand for snowboards?

• More costly production methods 
• A decrease in the price of lift tickets at resorts in Colorado 
• A decrease in consumer income   
• A decrease in the population 

Which of the following would not shift the supply curve for iphones?

• an increase in the price of iphones
• a decrease in the number of sellers of iphone
• an increase in the price of plastic, an input into the production of iphones
• an improvement in the technology used to produce iphones

An effective price floor must be set above equilibrium, resulting in:

• a shortage
• a surplus
• limited choices
• None of the above

What is the result of the government implementing a price floor of $60

• There would be a shortage of 100 since it is cheaper for consumers 
• There would be a surplus of 100 because it is more expensive for consumers 
• There would be a shortage of 100 because it is assisting the suppliers
• There would be a surplus of 100 because it is beneficial to consumers