AP Microeconomics 2.1 & 2.2 Test

According to the law of demand, which of the following occurs when the price of a good increases?

• The demand for the good decreases.

• The quantity demanded of a substitute good decreases.

• The quantity demanded of a complementary good increases.

• The quantity demanded of the good increases.

• The quantity demanded of the good decreases.

If the government imposes a tax on the production of cars, which of the following will occur in the market for cars?

• There will be a movement to the right along the supply curve.

• There will be a movement to the right along the demand curve.

• The supply curve will shift to the right.

• The supply curve will shift to the left.

• The demand curve will shift to the right.

The supply curve for automobiles will shift to the left in response to

• an increase in the efficiency of robot technology

• an increase in wages in the automobile industry

• a decrease in the number of consumers purchasing automobiles

• a decrease in the interest rates for automobile loans

• a decrease in consumers' income

Assume that consumers consider popcorn and pretzels to be substitutes. A significant decrease in the supply of popcorn will affect the pretzel market by

• increasing the demand for pretzels and therefore the supply of pretzels

• increasing the demand for pretzels and therefore the price of pretzels

• decreasing the demand for pretzels and therefore the price of pretzels

• increasing the supply of pretzels and therefore the price of pretzels

• decreasing the supply of pretzels and therefore the price of pretzels

All of the following cause a rightward shift in the demand schedule for a normal good EXCEPT

• a decrease in the price of the good

• a decrease in the price of a complementary good

• an increase in the price of a substitute good

• an increase in consumers’ income

• an increase in consumers’ preference for the good

Which of the following will decrease the demand for beef?

• An increase in the price of pork, if pork and beef are substitute goods

• An increase in the price of potatoes, if potatoes and beef are complementary goods

• A decrease in the cost of transporting beef to consumers

• An increase in the income levels of most consumers, if beef is a normal good

• Research showing beef is better for your health than chicken

For an inferior good, an increase in consumer income will cause

• the demand curve to shift to the left

• the demand curve to shift to the right

• the short-run supply curve to shift to the right

• the long-run supply curve to shift to the right

• new firms to enter the market in the long run

According to the law of demand, an increase in the price of grape juice will result in

• a rightward shift in the demand curve for grape juice

• a leftward shift in the demand curve for grape juice

• a decrease in the demand for orange juice, a substitute

• a decrease in the quantity of grape juice demanded

• an increase in the quantity of grape juice supplied

A leftward shift in the supply curve of watches could be caused by

• an increase in the price of watches

• an increase in wages paid to workers who produce watches

• an improvement in the technology associated with watchmaking

• a decrease in the price of parts used in the production of watches

• an increase in population

An increase in the supply of coffee could be caused by

• a decrease in the price of cream, which is a complement to coffee

• a decrease in the cost of labor used to produce coffee

• an increase in consumer income

• an increase in the demand for coffee

• an increase in the price of coffee