111.Supposetheincomesofbuyersinamarketforaparticularnormalgooddecreaseandthereisalsoareductionininputprices.Whatwouldweexpecttooccurinthismarket?
a.Equilibriumpricewoulddecrease,buttheimpactonequilibriumquantitywouldbeambiguous.
b.Equilibriumpricewouldincrease,buttheimpactonequilibriumquantitywouldbeambiguous.
c.Equilibriumquantitywoulddecrease,buttheimpactonequilibriumpricewouldbeambiguous.
d.Equilibriumquantitywouldincrease,buttheimpactonequilibriumpricewouldbeambiguous.
112.Whatwouldhappentotheequilibriumpriceandquantityofcoffeeifthewagesofcoffee-beanpickersfellandthepriceofteafell?
a.Pricewouldfall,andtheeffectonquantitywouldbeambiguous.
b.Pricewouldrise,andtheeffectonquantitywouldbeambiguous.
c.Quantitywouldfall,andtheeffectonpricewouldbeambiguous.
d.Quantitywouldrise,andtheeffectonpricewouldbeambiguous.
113.Whichofthefollowingeventswouldcauseboththeequilibriumpriceandequilibriumquantityofnumbertwogradepotatoestoincreaseifnumbertwogradepotatoesareaninferiorgood?
a.anincreaseinconsumerincome
b.adecreaseinconsumerincome
c.greatergovernmentrestrictionsonagriculturalchemicals
d.fewergovernmentrestrictionsonagriculturalchemicals
114.Beefisanormalgood.Youobservethatboththeequilibriumpriceandquantityofbeefhavefallenovertime.Whichofthefollowingexplanationswouldbemostconsistentwiththisobservation?
a.Consumershaveexperiencedanincreaseinincome,andbeef-productiontechnologyhasimproved.
b.Thepriceofchickenhasrisen,andthepriceofsteaksaucehasfallen.
c.Newmedicalevidencehasbeenreleasedthatindicatesanegativecorrelationbetweenaperson’sbeefconsumptionandlifeexpectancy.
d.Thedemandcurveforbeefmustbepositivelysloped.
115.DuringthelastfewdecadesintheUnitedStates,healthofficialshavearguedthateatingtoomuchbeefmightbeharmfultohumanhealth.Asaresult,therehasbeenasignificantdecreaseintheamountofbeefproduced.Whichofthefollowingbestexplainsthedecreaseinproduction?
a.Beefproducers,concernedaboutthehealthoftheircustomers,decidedtoproducerelativelylessbeef.
b.Governmentofficials,concernedaboutconsumerhealth,orderedbeefproducerstoproducerelativelylessbeef.
c.Individualconsumers,concernedabouttheirownhealth,decreasedtheirdemandforbeef,whichloweredtheequilibriumpriceofbeef,makingitlessattractivetoproduce.
d.Anti-beefprotestershavemadeitdifficultforbothbuyersandsellersofbeeftomeetinthemarketplace.
116.Whichofthefollowingeventswouldunambiguouslycauseadecreaseintheequilibriumpriceofcottonshirts?
a.anincreaseinthepriceofwoolshirtsandadecreaseinthepriceofrawcotton
b.adecreaseinthepriceofwoolshirtsandadecreaseinthepriceofrawcotton
c.anincreaseinthepriceofwoolshirtsandanincreaseinthepriceofrawcotton
d.adecreaseinthepriceofwoolshirtsandanincreaseinthepriceofrawcotton
117.Whichofthefollowingeventswouldunambiguouslycauseanincreaseintheequilibriumpriceofcottonshirts?
a.anincreaseinthepriceofwoolshirtsandadecreaseinthepriceofrawcotton
b.adecreaseinthepriceofwoolshirtsandadecreaseinthepriceofrawcotton
c.anincreaseinthepriceofwoolshirtsandanincreaseinthepriceofrawcotton
d.adecreaseinthepriceofwoolshirtsandanincreaseinthepriceofrawcotton
118.Whichofthefollowingeventswouldcausethepriceoforangestofall?
a.Thereisashortageoforanges.
b.TheFDAannouncesthatbananascausestrokes,andorangesandbananasaresubstitutes.
c.ThepriceoflandthroughoutFloridadecreases,andFloridaproducesasignificantproportionofthenation’soranges.
d.Alloftheabovearecorrect.
119.Whatwouldhappentotheequilibriumpriceandquantityoflattésifconsumers’incomesriseandlattésareanormalgood?
a.Boththeequilibriumpriceandquantitywouldincrease.
b.Boththeequilibriumpriceandquantitywoulddecrease.
c.Theequilibriumpricewouldincrease,andtheequilibriumquantitywoulddecrease.
d.Theequilibriumpricewoulddecrease,andtheequilibriumquantitywouldincrease.
120.Ifmacaroniandcheeseisaninferiorgood,whatwouldhappentotheequilibriumpriceandquantityofmacaroniandcheeseifconsumers’incomesrise?
a.Boththeequilibriumpriceandquantitywouldincrease.
b.Boththeequilibriumpriceandquantitywoulddecrease.
c.Theequilibriumpricewouldincrease,andtheequilibriumquantitywoulddecrease.
d.Theequilibriumpricewoulddecrease,andtheequilibriumquantitywouldincrease.
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