Suppose there is a simultaneous increase in the demand for wheat and increase in the supply of wheat. Which of the following will occur as a result of these simultaneous events?
A) Both the market clearing price and equilibrium quantity will rise.
B) The market clearing price will fall, but the equilibrium quantity will rise.
C) The market clearing price may rise, fall, or stay the same, but the equilibrium quantity will rise.
D) The market clearing price will fall, but the equilibrium quantity may rise, fall, or stay the same.
Ques. 2An example of a microeconomic decision is a situation in which
A) the Federal Reserve considers how much to increase the money supply during the coming month in an effort to constrain the rate of inflation.
B) Congress and the president seek to reach a compromise on how much to increase government spending in an effort to influence national expenditures.
C) a firm evaluates how much to reduce the price of its product in an effort to influence sales and boost its profits.
D) the U.S. Treasury contemplates buying foreign currencies in an effort to influence exchange rates with an aim to boosting demand for U.S. goods and services.
Ques. 3The term labor for an economist includes
A) all skilled workers, but not the unskilled workers.
B) all productive contributions of humankind.
C) only the value of the work done by scientists.
D) all employees who have high school diplomas.
Ques. 4The relative price of a textbook is
A) the money price of the textbook divided by the money price of some other good.
B) the price of the textbook compared with what students think it should cost.
C) the amount it cost to make the textbook.
D) what the author earned for writing the textbook.
Ques. 5Microeconomics is the study of
A) aggregate measures of the economy.
B) foreign policy economic issues.
C) federal budget details.
D) individual decision making.
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