Sophia Macroeconomics Milestone 2 Questions and Answers Already Passed.

Document Content and Description Below

Sophia Marcoeconomics Milestone 2 1 Select the TRUE statement below regarding aggregate supply in the short and long run. In the long run, there are no limits on production. The relationship betw... een price level and RGDP is negative in the short run. The LRAS curve can move over time. In the long run, there is a close relationship between price level and RGDP. CONCEPT Aggregate Supply 2 Which graph below correctly illustrates a scenario in which the regular price for a set of four tires is $250, but Erin finds a store that has the tires she needs on sale for $175? CONCEPT Shifts in Demand 3 Which of the following would NOT cause a shift in the supply curve for cheese? The results of a medical study show that eating too much cheese can lead to premature aging. The price of feed for the dairy cattle goes up significantly. A celebrity chef develops a new technique for making cheese that makes it easier to increase output. Thousands of dairy cattle come down with a mysterious illness and need to be quarantined. CONCEPT Law of Supply 4 As the price level falls, people feel as if they have more money, so they spend more, which influences which of the following, in economic terms? Aggregate supply Interest rate effect Aggregate demand Exchange rate effect CONCEPT Aggregate Demand 5 If the price of gasoline is too low and vendors sell out quickly, which of the following will happen next? Consumers will purchase less gasoline. Consumers will purchase more gasoline. The price of gasoline will rise to eliminate the shortage. Producers will lower the price of gasoline. CONCEPT Prevailing Price 6 Which statement below best describes what will most likely happen, from an economic standpoint, when a music group with growing popularity goes on tour and sells out a certain venue in hours with tickets for $25 apiece? The group will add more performance dates with tickets at a lower cost. The price of tickets for future concert dates will rise until it hits equilibrium. Nothing changes, since the market is already clearing. The group will cancel the concert and give everyone a refund. CONCEPT Prevailing Price 7 The prevailing market price for smart TVs is $450 and John is willing to pay $600 for a TV. Which graph accurately represents the amount of consumer surplus? CONCEPT Consumer Surplus 8 Select the statement below that is true of BOTH price ceilings AND price floors. Nothing happens if it is placed above equilibrium. This is a form of government policy that alters the market. When this is binding, it can cause a surplus. To be effective it has to be below equilibrium. CONCEPT Binding & Non-Binding Constraints 9 George wants to get rid of his old car so he can purchase a newer model. He has figured out that he will not accept a price lower than $3,000, but a buyer offers to pay $5,000 for the car. How much producer surplus will George receive from this sale? $2,000 $8,000 $5,000 $3,000 CONCEPT Producer Surplus 10 Jack is willing to pay as much as $1,300 for a new camera but is happy to find one he likes that costs $400. Select the term below that corresponds to this situation. Equilibrium Consumer surplus Producer surplus Ceteris paribus CONCEPT Consumer Surplus 11 Roberto suspected that traditional four-year higher education in the U.S. was being influenced by the recession. Most states cut the amount they contribute to public universities, making it much more expensive for them to operate in the traditional format. This caused many universities to invest in nontraditional, technology-based educational models. Which graph below best depicts the change Roberto is seeing in the traditional four-year higher education market in the U.S.? CONCEPT Shifts in Supply 12 What economic rule is generally used in the decision of a regulator to impose a binding price constraint? When it creates deadweight loss When consumer and producer surplus are maximized When the benefit to a specific group of people is greater than deadweight loss When it transfers surplus from producers to consumers CONCEPT Deadweight Loss 13 Which of the following is an example of the Law of Demand? The price of alpaca wool is increasing, so farmers are offering more of it. The amount of lumber that a certain region can produce is stable. The price of gas is decreasing, so people are buying more of it. The price of gas is decreasing, so vendors are offering less of it. CONCEPT Law of Demand 14 In economic terms, which of the following happened when cupcakes went from being homemade treats to being specialized gourmet goodies with multiple TV shows devoted to them and people waiting in line for them? [Show More]

Last updated: 2 years ago

Preview 1 out of 11 pages