Take Test: Week 2 Quiz

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Question 1

  1. The ____________ is the quantity where quantity demanded and quantity supplied are equal at a certain price.

    quantity produced

    equilibrium quantity

    demand schedule

    supply schedule

2 points

Question 2

  1. Which of the following would reduce the supply of microcomputers?

    a technological improvement that lowers the cost of producing the computers

    higher wage rates for the workers that assemble the computers

    a reduction in the price of computer chips used to produce the computers

    a reduction in the price of computers

2 points

Question 3

  1. The nature of demand indicates that as the price of a good increases:

    suppliers wish to sell less of it.

    more of it is produced.

    more of it is desired.

    buyers desire to purchase less of it.

2 points

Question 4

  1. When economists talk about supply, they are referring to a relationship between price received for each unit sold and the _________________.

    demand schedule

    market price

    quantity supplied

    demand curve

2 points

Question 5

  1. If a firm faces ________________________, while the prices for the output the firm produces remain unchanged, a firm’s profits will increase.

    higher demand

    lower costs of production

    equilibrium

    a shift in demand

2 points

Question 6

  1. If the price is below the equilibrium level, then the quantity demanded will exceed the quantity supplied. What is this known as?

    excess supply

    excess demand

    ceteris paribus

    a price ceiling

2 points

Question 7

  1. What is the term for the total number of units that are purchased at that price?

    quantity

    quantity demanded

    supply

    market quantity

2 points

Question 8

  1. According to the law of supply:

    there is a direct relationship between price and the quantity supplied.

    there is an inverse relationship between price and the quantity supplied.

    there is a direct relationship between price and quantity demanded.

    there is an inverse relationship between price and quantity demanded.

2 points

Question 9

  1. A supply curve is a graphical illustration of the relationship between price, shown on the vertical axis, and ____________, shown on the horizontal axis.

    demand

    quantity

    quantity supplied

    quantity demanded

2 points

Question 10

  1. What is the term economists use to refer to the relationship that a higher price leads to a lower quantity demanded?

    income gap

    market equilibrium

    law of demand

    price model

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