Pennsylvania State University - ECON 102Quiz 03. All Correct answers Reviewed and indicated. 100% Score.

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ECON 102 Quiz 03 UnansweredQuestion 1 1 / 1 pts The price of a hamburger at a fast food restaurant increases from $2.30 to $3.50. The law of demand predicts that consumers will buy fewer... hamburgers at the fast food restaurant. consumers will purchase more French Fries at the fast food restaurant. consumers will buy more hamburgers at the fast food restaurant. consumers' purchases of hamburgers at the fast food restaurant will not change. The law of demand states that as the price of a product increases, consumers will purchase less of the product, and vice versa. UnansweredQuestion 2 0 / 1 pts Which of the following are the best examples of complements? white bread and wheat bread peanut butter and jelly mayonnaise and mustard roast turkey and smoked ham Peanut butter and jelly are complements because they are typically consumed together. The others are examples of substitutes because they are typically consumed in place of each other. UnansweredQuestion 3 0 / 1 pts In the above figure, a decrease in the price of a complement for a product is represented by the movement from P0 to P1 in Graph B. the movement from D0 to D1 in Graph A. the movement from P1 to P0 in Graph B. the movement from D1 to D0 in Graph A. A decrease in the price of a complement causes an increase in demand. This is represented in Graph A by a movement from D0 to D1. UnansweredQuestion 4 0 / 1 pts The law of supply states that as price rises, quantity supplied will fall, and vice versa, ceteris paribus. as price rises, quantity supplied will remain constant, ceteris paribus. None of the above is correct. as price rises, quantity supplied will rise, and vice versa, ceteris paribus. The law of supply states that as price rises, quantity supplied will rise, and vice versa. UnansweredQuestion 5 0 / 1 pts Each of the following would cause a decrease in the supply of corn EXCEPT an increase in the price of soybeans. a season of unfavorable weather. an increase in the wage rate for agricultural workers. an advancement in technology used to produce corn. A technological advancement will cause an increase in supply. The other options cause a decrease in the supply of corn. UnansweredQuestion 6 0 / 1 pts In the above figure, a decrease in the price of the product is represented by the movement from P1 to P0 in Graph B. the movement from S1 to S0 in Graph A. the movement from S0 to S1 in Graph A. the movement from P0 to P1 in Graph B. A change in the price of the product is represented by a movement along the supply curve, which is represented in Graph B. The decrease in the price is a movement from P1 to P0. UnansweredQuestion 7 0 / 1 pts A shortage occurs in a market when quantity supplied and quantity demanded sum to zero at the prevailing price. quantity supplied equals quantity demanded at the prevailing price. quantity supplied is greater than quantity demanded at the prevailing price. quantity supplied is less than quantity demanded at the prevailing price. When quantity supplied is less than quantity demanded, we have excess demand, or a shortage, in the market. UnansweredQuestion 8 0 / 1 pts When consumers' income increases, what happens to equilibrium price and quantity for a normal good? We expect equilibrium price and equilibrium quantity to increase. We expect equilibrium price and equilibrium quantity to decrease. We expect equilibrium price to increase and equilibrium quantity to decrease. We expect equilibrium price to decrease and equilibrium quantity to increase. When income increases, the demand for a normal good increases. Therefore equilibrium price and quantity both increase. UnansweredQuestion 9 0 / 1 pts Which of the figures above would be an appropriate representation of the effects of an increase in the price of gasoline on the trucking industry. Figure 4 Figure 2 Figure 1 Figure 3 An increase in the cost of an input causes supply to decrease. This is represented in figure 4 above. UnansweredQuestion 10 0 / 1 pts In the above figure, if the government sets the minimum legal price of the product at $1.50, then the $1.50 acts as a(n) price ceiling. equilibrium price. price floor. market clearing price. A minimum legal price is a price floor. Quiz Score: 0 out of 10 Quiz 03 Question 1 1 / 1 pts The law of demand is a statement that relates which two variables? Correct! price and quantity demanded price and quantity supplied price and household income price and preferences The law of demand states that there is a negative relationship between price and quantity demanded. Question 2 1 / 1 pts Which of the following are the best examples of complements? roast turkey and smoked ham white bread and wheat bread mayonnaise and mustard Correct! peanut butter and jelly Peanut butter and jelly are complements because they are typically consumed together. The others are examples of substitutes because they are typically consumed in place of each other. Question 3 0 / 1 pts An increase in demand for flip flops could be caused by an increase in the price of flip flops. You Answered a decrease in the price of flip flops. a decrease in the price of sandals, a substitute for flip flops. an increase in the price of sandals, a substitute for flip flops. A change in demand is caused by a change in something other than the price of the product. In this case, the increase in demand is caused by an increase in the price of a substitute. Question 4 1 / 1 pts A graphical representation of a supply schedule is a Correct! supply curve. supply graph. supply chart supply diagram. A supply curve is a graphical representation of a supply schedule. Question 5 1 / 1 pts Which of the following will cause a shift of the entire supply curve? A change in the price of a substitute. A change in consumers' income. Correct! A change in the price of an input. A change in the price of the product. The cost of an input is a determinant of supply. Question 6 0 / 1 pts In the above figure, a decrease in the price of an input for a product is represented by the movement from P0 to P1 in Graph B. the movement from S1 to S0 in Graph A. the movement from S0 to S1 in Graph A. You Answered the movement from P1 to P0 in Graph B. A decrease in the price of an input for a product causes an increase in supply. This is represented in Graph A by a movement from S0 to S1. Question 7 1 / 1 pts A shortage occurs in a market when quantity supplied is greater than quantity demanded at the prevailing price. Correct! quantity supplied is less than quantity demanded at the prevailing price. quantity supplied equals quantity demanded at the prevailing price. quantity supplied and quantity demanded sum to zero at the prevailing price. When quantity supplied is less than quantity demanded, we have excess demand, or a shortage, in the market. Question 8 1 / 1 pts When consumers' income increases, what happens to equilibrium price and quantity for a normal good? Correct! We expect equilibrium price and equilibrium quantity to increase. We expect equilibrium price to decrease and equilibrium quantity to increase. We expect equilibrium price and equilibrium quantity to decrease. We expect equilibrium price to increase and equilibrium quantity to decrease. When income increases, the demand for a normal good increases. Therefore equilibrium price and quantity both increase. Question 9 1 / 1 pts In the above figure, if the supply curve moves from S0 to S1 and the demand curve remains at D0. which of the following statements is TRUE? Correct! Supply has increased. Quantity supplied has decreased. Supply has decreased. A rightward shift in the supply curve is an increase in supply. Question 10 1 / 1 pts In the above figure, if the government sets the maximum legal price of the product at $0.75, then the $0.75 acts as a(n) price floor. Correct! price ceiling. equilibrium price. market clearing price. A maximum legal price is a price ceiling. Quiz Score: 8 out of 10 [Show More]

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