Econ Level Test 3

Which of the following factors helps the elasticity of supply for a particular good move toward being elastic? 

• difficulty in exiting the market

• difficulty in entering the market

• scarcity of a key input

• a longer time horizon 

• a shorter time horizon 

What is the biggest cost of attending college for most people, as explained in the USAD Economics Resource  Guide?

• books

• tuition

• time

• money

• housing

If an analyst does not have any expressed opinion about the merits of different choices, the analyst is applying  _____ economic analysis.

• normative

• rational

• positive

• negative

• neutral

Which of the following will shift the supply curve for a particular good? 

• a price increase

• a change in tastes

• a change in the number of buyers

• a change in expectations of future prices

• a change in the income of consumers

The coach of a hockey team tells his players that if they want to be better next season, they need to spend less  time at home and more time at practice. Which of the following is TRUE?

• The players can have a better season and more time at home. 

•  The players face a trade-off between a better season and more time at home.

• The players cannot spend more time at practice because time is scarce.

• The players must not be rational, or they would already be doing better.

• The players are rational, so they will spend more time at practice.

Five LED ring lights are sold for $25 each. In this case, what is the total revenue?

• $125 

• $25

• $75

• $100

• $150

Suppose that, at current prices, there is a surplus of hairdryers. What changes are likely to result? 

• The price of hairdryers will increase.

• The price of hairdryers will decrease.

• The quantity supplied of hairdryers will decrease.

• The quantity demanded of hairdryers will increase.

• Demand will shift leftward.

If the price of gasoline is below the equilibrium market price, _________.

•  there is an excess supply for gasoline

• there is an increase in supply for gasoline

• there is a decrease in supply for gasoline

•  there is an excess demand for gasoline

• there is a decrease in demand for gasoline

Joseph is willing to pay a $100 for a concert ticket, Sheena is willing to pay $80, and Zoey is willing to  pay $60. If concert tickets cost $60, what is the combined consumer surplus for Joseph, Sheena and  Zoey? 

•  $30

• $40

• $50

• $70

• $60

Which of the following BEST explains Coase’s Theorem? 

• Under the right conditions, the private market should be able to resolve the inefficiencies created by  externalities.

• The government will need to mediate both sides in the event of a dispute.

• The market will eventually achieve a perfect equilibrium point. 

• The private market will obtain a resolution regarding efficiencies between two parties

• The parties involved will utilize legal remedies when handling major disagreements.