Suppose that the market for coffee is in equilibrium at a price of 9.50 per pound and a monthly quantity of 20 million pounds. News of a drought in Brazil arrives so that people know that the supply of coffee months from now will be sharply reduced.
What, if anything, will happen in the coffee market now? Explain.
Ques. 2Which of the following does NOT cause a shift in demand?
A) change in income
B) change in tastes
C) change in the price of the good
D) change in the price of a related good
Ques. 3The use of data in economic models is important because
A) the model's predictive value rests on supportive evidence from real-world data.
B) the models are always complex in nature.
C) models must analyze every possible angle of the problem.
D) social problems analyzed by economists require long streams of data.
Ques. 4If an economy is operating at a point inside the production possibilities curve, then
A) society's resources are being inefficiently utilized.
B) the curve will move to the left.
C) society's resources are being used to produce too many consumer goods.
D) economic policy must implemented to slow growth of the economy further.
Ques. 5When examining the growth record of any nation
A) all that must be examined is increases in per capital real GDP.
B) no consideration should be given to the change in the average amount of leisure time in the nation.
C) increases in per capita real GDP must be considered along with how far the production possibilities curve has shifted.
D) we must consider which income groups have benefited most from the growth.
Ques. 6Precautionary demand for money will fall when
A) the interest rate rises.
B) the interest rate falls.
C) the money supply increases.
D) government spending falls.
Ques. 7All of the following are considered to be unemployed EXCEPT
A) job leavers.
B) discouraged workers.
C) job reentrants.
D) new job entrants.
Ques. 8A current concern about Social Security is that
A) funds set aside by past generations to pay benefits for future generations are growing too rapidly and may trigger inflation.
B) promised benefit payouts are growing more rapidly than likely sources of revenues, indicating a future inability to keep the system operating.
C) continued political bickering between the president and Congress could lead to an end to any funding of the program.
D) the payroll taxes used to fund the program are being eliminated as part of an effort to generate employment increases, thus leaving the program bankrupt.
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