Economics Test 2, Chapters 3-5

Which of the following will most likely persuade a dairy farmer to purchase more cows?

• the price of grain

• the price of milk

• current real-estate markets

• current interest rates

What term do economists use to describe the act of buying?

• supply

• price

• util

• demand

The rightward shift of a demand curve indicates

• an increase in demand.

• a decrease in demand.

• an increase in the quantity demanded.

• a decrease in the quantity demanded.

The leftward shift of a demand curve indicates

• an increase in demand.

• a decrease in demand.

• an increase in the quantity demanded.

• a decrease in the quantity demanded.

A drop in income would have the least effect on the demand for

• candy bars

• bread

• steaks

• automobiles

Bacon and eggs best qualify as an example of

• inferior goods.

• substitute goods.

• complementary goods.

• free goods.

What term describes the amount of a product a company is willing to provide at various prices?

• Demand

• Product Ceiling

• Supply

• Equilibrium Point

What does a rightward shift in a supply curve indicate?

• an increase in supply

• a decrease in supply

• an increase in the quantity supplied

• a decrease in the quantity supplied

What does a leftward shift in a supply curve indicate?

• an increase in supply

• a decrease in supply

• an increase in the quantity supplied

• a decrease in the quantity supplied

Economist Alfred Marshall is best known for the

• price control concept.

• surplus/shortage paradox.

• market equilibrium theory.

• demand and supply model.