Economics Unit 2 Exam Review

Recently the price of a popular perfume has increased by $10. How will the price change likely affect the quantity demanded and supplied?

• Supply will stay the same, and demand will increase

• Supply will decrease, and demand will increase.

• Supply will increase, and demand will decrease.

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

Ivanka Trump closed her fashion brand, after boycotts from consumers following her father's election. The brand was a target of the Boycott Trump campaign due to Ivanka's links with the President and her own role as a senior adviser. According to the Wall Street Journal, which cited research from Rakuten Intelligence, online sales of the brand at Amazon, Macy's and Bloomingdales fell almost 45% in the year to June. Several retailers also dropped the brand. — https://www.ethicalconsumer.org/ (accessed, December 2019

This scenario is an example of how a shift in demand can be created by —

• higher prices

• profit motive

• laissez-faire policies

• a non-price determinant

Which of the following is a non-price determinant of demand?

• Subsidy

• Productivity

• Price ceiling

• Consumer preferences

On a supply and demand graph, supply will decrease and shift to the left when which of the following happens?

• The number of firms leaving the industry increases.

• There are fewer government regulations in place.

• The total cost of inputs decreases.

• Production taxes decline over a short period of time.

Which of the following would most likely cause the shift shown on the graph?

• The cost of parts for cell phones has gone up.

• The cell phone company made a large profit this year.

• Cell phone salesmen are working overtime to sell phones.

• A new, popular model of cell phone just came on the market.

Which non-price determinate is sometimes utilized by the government to decrease demand for a product that is viewed as harmful to society?

• Subsidies

• Rationing

• Excise taxes

• Consumer boycotts

Which of the following conditions could explain the shift in the demand curve shown on the graph?

• Farmers harvested a bumper crop of tomatoes..

• Shoppers learned that cans of cooked tomatoes are spoiled.

• Surveys found that people are eating more cooked tomatoes.

• Eating cooked tomatoes was found to have more health benefits

A supply-and- demand graph based on the demand schedule for gasoline would show that

• demand for gasoline decreases as the price decreases

• the price for gasoline remains constant as the demand increases

• as the price of gasoline decreases, the quantity demanded increases

• as the quantity demanded decreases, the price of gasoline decreases

Based on the information in the graph and the table, what is the equilibrium price of pizza?

• 2.00

• 4.00

• 3.00

• 5.00

Which economic concept does the information in the table illustrate?

• Absolute advantage

• Balance of trade

• Factors of production

• Comparative advantage