If both buyers and sellers expect the price of a commodity to rise in the future, it is likely that the market clearing price ________ and the equilibrium quantity ________.
A) will fall, cannot be predicted
B) will rise, cannot be predicted
C) cannot be predicted, will fall
D) cannot be predicted, will rise
Ques. 2The concept that producing goods and services generates the means and the willingness to purchase other goods and services is
A) the Keynesian approach.
B) money illusion.
C) Say's law.
D) cost-push inflation.
Ques. 3A friend tells you he is studying the incidence of the corporate income tax. What is the subject of his study?
A) how frequently corporations should be taxed
B) how inflation affects the amount of tax revenue collected from firms
C) how corporations can aid the government in collecting delinquent taxes
D) how the burden of corporate taxation is distributed among stockholders, employees, and consumers
Ques. 4Suppose you order a slice of pepperoni pizza and a soda at a shopping mall food court. What are examples of the opportunity costs of this decision?
What will be an ideal response?
Ques. 5An increase in the price of corn will lead to
A) an upward (and leftward) movement along the demand curve for corn.
B) a leftward shift in the demand curve for corn.
C) a rightward shift in the supply curve for corn.
D) an increase in the quantity of corn consumed.
Ques. 6Which of the following is an example of an application of the ceteris paribus assumption?
A) An analysis of how price changes affect how much of a good people will purchase when all other factors are held constant
B) An analysis of how people purchase more goods when prices decline and income increases
C) After reading an article on the dangers of high-fat diets, an individual buys less red meat when prices increase
D) An analysis of how worker productivity increases when a firm invests in new machines and training programs
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