Unit 2 Review

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

• Subsidy

• Productivity

• Price ceiling

• Consumer preferences

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 the 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

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

• Survey 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

• $3.00

• $4.00

• $5.00

Which of the following accounts for why countries specialize in particular trade products?

• Government regulations

• Variation in the size of markets

• Unequal distribution of resources

• Variety in the types of economic systems

Which of the following is described by the characteristics listed in the box? One seller Complete barriers to market entry No product differentiation

• Monopoly

• Oligopoly

• Pure competition

• Monopolistic competition