Which of the following influences does NOT shift the supply curve?

a) an increase in consumer incomeb) a decrease in the price firms expect to

receive in the futurec) a rise in the wages paid workersd) development of new technology

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Market equilibrium is a situation in which:a) consumers obtain the highest quantity at

the lowest pricesb) producers obtain the highest price for a

given quantity soldc) quantity supplied equals quantity

demanded at a single priced) the market yields a substantial surplus of

goods produced

2

The number of people seeking to obtain tickets to an OSU football game is nearly always larger than the number of available tickets (and seats) to the game. This is evidence that the price of the ticket is

a) above the equilibrium level b) below the equilibrium level c) too high for many to afford d) at the equilibrium level because the

number of tickets bought always equals the number of tickets for sale.

3

Which of the following statements uses incorrect terminology:A: "The recent fare war among the major airlines has increased the demand for air travel.“B: "The terrorist attack on America has caused the demand for air travel to fall."

a) A is incorrect; B is correctb) A is correct; B is incorrectc) A and B are correctd) A and B are incorrect

4

Which of the graphs below best illustrates a situation in which price will fall?

a) The graph on the leftb) The graph on the rightc) Both graphsd) Neither graph

5

Between 2002 and 2003 bad weather affected the area where most of the world’s vanilla is grown. Which of the graphs below best depicts that situation?

a) Ab) Bc) Cd) D

6

After bad weather affected most of the world’s natural vanilla, which of the graphs below best depicts what happened in the market for synthetic vanilla?

a) Ab) Bc) Cd) D

7

You notice that the price of DVD players falls and the quantity of DVD players sold increases. This set of observations can be the result of:

a) a shift of the demand curve for DVD players to the right

b) a shift of the demand curve for DVD players to the left

c) a shift of the supply curve of DVD players to the right

d) a shift of the supply curve of DVD players to the left

8

Most economists believe that the U.S. minimum wage has relatively little effect because it is set too:a) low and therefore is nonbindingb) high and therefore is nonbindingc) low and therefore is bindingd) high and therefore is binding

9

Assume that beer and nachos are complements. If the price of beer falls, we may predict that: a) the demand for beer will increase, which will then

force the price of beer back up. b) the demand for nachos will decrease. c) the demand for nachos will increase. d) (a) and (c).

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Which of the following is an example of a black market?a) a tenant in a rent controlled apartment

subletting at a higher rentb) the purchase of an inferior radio at a

department storec) waiting in line during the oil shortages of the

1970sd) none of the above

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A consumer's willingness to pay for a surfboard is the minimum price at which he or she would buy the surfboarda) Trueb) False

12

To the extent that eBay moves the markets for collectibles and other items to equilibrium, it can be said to:

a) maximize consumer surplusb) maximize producer surplusc) maximize total surplusd) create a market failure

13

Equilibrium in the fish market is disturbed by two different events: (i) a report by the American Medical Association announces that increased consumption of fish is associated with lower heart disease, and (ii) fisherman are banned from fishing in environmentally sensitive areas that previously were important sources for their catch. In the market for fish,

a) Equilibrium price will increase and equilibrium output will decrease

b) Both equilibrium price and output will increase c) Equilibrium quantity will decrease but we don’t have

enough information to determine the change in equilibrium price

d) Equilibrium price will increase but we don’t have enough information to determine the change in equilibrium quantity

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