A decrease in the price of GPS systems will result in
A. a smaller quantity of GPS systems supplied.
B. a decrease in the demand for GPS systems.
C. a larger quantity of GPS systems supplied.
D. an increase in the supply of GPS systems.
11) If, for a product, the quantity supplied exceeds the quantity demanded, the market price will fall until
A. the quantity demanded exceeds the quantity supplied. The market will then be in equilibrium.
B. all consumers will be able to afford the product.
C. quantity demanded equals quantity supplied. The equilibrium price will then be lower than the market price.
D. quantity demanded equals quantity supplied. The market price will then equal the equilibrium price.
12) Which of the following is evidence of a surplus of bananas?
A. Firms raise the price of bananas.
B. The equilibrium price of bananas rises due to an increase in demand.
C. The price of bananas is lowered in order to increase sales.
D. The quantity demanded of bananas is greater than the quantity supplied.
13)At low wages, the labor supply curve for most people slopes upward because
A. the supply of labor is perfectly inelastic at low wages.
B. as wages increase income also increases unless hours worked decrease.
C. as wages increase the opportunity cost of leisure increases.
D. the demand for labor is perfectly elastic at low wages.
14) Which of the following best explains why unemployment rates are higher in the European economies than in the United States? A. More Europeans go to school fulltime and are therefore not able to participate in the labor market.
B. Workers in Europe are less productive than workers in the United States.
C. Unemployment benefits are more generous in Europe than in the United States.
D. European industries pay a lower wage rate than industries in the United States.
15) Firms use information on labor's marginal revenue product to determine
A. how much to produce at each output price.
B. how much marginal product to produce at each wage rate.
C. how many workers to hire at each wage rate.
D. how much labor services to supply at each wage rate.
16) A decrease in the wage rate causes
A. an increase in the quantity of labor demanded.
B. a leftward shift of the firm's labor demand curve.
C. a rightward shift of the firm's labor demand curve.
D. a decrease in labor's productivity.
17) An individual's labor supply curve shows
A. the maximum wage rates offered to that individual by various potential employers.
B. the relationship between the quantity of hours worked and total income earned by that individual.
C. the relationship between wages and the quantity of labor that a firm is willing to employ.
D. the relationship between wages and the quantity of labor that she is willing to supply.
18) How will an increase in population affect the labor market?
A. It will shift the market supply curve.
B. It will increase the opportunity cost of leisure.
C. It will increase the supply of jobs.
D. It will cause a decrease in the quantity of labor demanded.
19) Which of the following displays rivalry and excludability in consumption?
A. public goods
B. common resources
C. quasi-public goods
D. private goods
20) Private costs
A. are borne by producers of a good while social costs are borne by government.
B. are borne by producers of a good while social costs are borne by those who cannot afford to purchase the good.
C. are borne by producers of a good while social costs are borne by society at large.
D. are borne by consumers of a good while social costs are borne by government.
21) Which of the following is an example of a quasi-public good? A. cable television
B. crime prevention
C. stock of knowledge in the public domain
D. organic apples
22) One reason why the coffeehouse market is competitive is that A. demand for specialty coffee is very high.
B. consumption takes place in public.
C. barriers to entry are low.
D. it is trendy and therefore is likely to have a customer following. 23) The reason that the coffeehouse market is monopolistically competitive rather than perfectly competitive is because
A. barriers to entry are very low.
B. entry into the market is blocked.
C. products are differentiated.
D. there are many firms in the market.
24) The key characteristics of a monopolistically competitive market structure include
A. many small (relative to the total market) sellers acting independently.
B. sellers have no incentive to advertise their products.
C. barriers to entry are strong.
D. all sellers sell a homogeneous product.