ECON B-251 Final Exam Study Guide Questions With Accurate Solutions

ECON B-251 Final Exam Study Guide Questions
With Accurate Solutions

If |the |quantity |of |textbooks |supplied |is |10,000 |per |year |and |the |quantity |of |textbooks |
demanded |is |11,000 |per |year, |there |is |a |________ |in |the |market |and |the |price |will |________.



A) |shortage; |increase

B) |shortage; |decrease

C) |surplus; |increase

D) |surplus; |decrease |- |CORRECT |ANSWER✔✔-A) |shortage; |increase



The |demand |for |a |good |is |more |price |elastic



A) |if |less |substitutes |are |available |

B) |if |the |good |is |a |necessity |rather |than |a |luxury

C) |in |the |short |run |than |the |long |run

D) |if |the |share |of |the |good |in |the |average |consumer's |budget |is |larger |- |CORRECT |
ANSWER✔✔-D) |if |the |share |of |the |good |in |the |average |consumer's |budget |is |larger



You |observe |in |the |market |for |coffee |the |equilibrium |price |of |coffee |increased |and |the |
equilibrium |quantity |of |coffee |decreased. |These |observations |can |be |the |result |of |a(n)



A) |decrease |in |the |price |of |coffee |beans |used |to |produce |coffee

B) |decrease |in |the |price |of |tea, |which |is |a |substitute |in |consumption

C) |new |medical |study |finding |the |positive |health |benefits |of |drinking |coffee

D) |new |tax |on |coffee |- |CORRECT |ANSWER✔✔-D) |new |tax |on |coffee

,Allocative |efficiency |occurs |when



A) |we |cannot |produce |more |of |any |one |good |without |giving |up |some |other |good

B) |marginal |benefit |is |less |than |marginal |cost

C) |we |cannot |produce |more |of |any |good |without |giving |up |some |other |good |that |we |value |
more |highly

D) |opportunity |costs |are |decreasing |- |CORRECT |ANSWER✔✔-C) |we |cannot |produce |more |of |
any |good |without |giving |up |some |other |good |we |value |more |highly



Moving |from |one |point |on |the |production |possibilities |frontier |to |another |involves |_________



A) |no |tradeoff |but |id |does |incur |an |opportunity |cost

B) |a |tradeoff |and |incurs |an |opportunity |cost

C) |a |tradeoff |but |does |not |incur |an |opportunity |cost

D) |an |opportunity |cost |but |no |tradeoff |- |CORRECT |ANSWER✔✔-B) |a |tradeoff |and |incurs |an |
opportunity |cost



The |tax |on |producing |cookies |decreases |simultaneously |as |peoples |income |increases |and |
cookies |are |a |normal |good. |As |a |result, |the |equilibrium |price |of |cookies |________ |and |the |
equilibrium |quantity |of |cookies |________



A) |might |increase, |decrease, |or |stay |the |same; |increases

B) |decreases; |might |increase, |decrease, |or |stay |the |same

C) |increases; |might |increase, |decrease, |or |stay |the |same

D) |might |increase, |decrease, |or |stay |the |same; |decreases |- |CORRECT |ANSWER✔✔-A) |might |
increase, |decrease, |or |stay |the |same; |increases

,The |quantity |supplied |of |a |good |or |service |is |the |quantity |that |a |producer |__________ |at |a |
particular |price |during |a |given |time |period.



A) |is |willing |to |buy

B) |should |sell

C) |actually |sells

D) |is |willing |to |sell |- |CORRECT |ANSWER✔✔-D) |is |willing |to |sell



With |a |day's |labor, |Jia |can |producer |12 |cakes |or |4 |cookies; |Tyrel |can |produce |20 |cakes |or |6 |
cookies. |Tyrel's |opportunity |cost |of |producing |1 |cake |is |_______ |cookies |per |cake |and |he |
should |specialize |in |the |production |of |_________



A) |6; |cakes

B) |0.33; |cookies

C) |0.30; |cakes

D) |3.33; |cookies |- |CORRECT |ANSWER✔✔-C) |0.30; |cakes



An |increase |in |the |nation's |human |capital |(education) |will



A) |shift |the |PPC |outward

B) |cause |a |movement |along |the |PPC |upward |and |leftward

C) |cause |a |movement |along |the |PPC |downward |and |rightward

D) |move |the |nation |from |producing |within |the |PPC |to |producing |at |a |point |closer |to |the |PPC |-
|CORRECT |ANSWER✔✔-A) |shift |the |PPC |outward




Which |of |the |following |questions |is |a |macroeconomic |issue?

, A) |What |effect |would |a |vaccine |for |Covid |have |on |the |market |for |pharmaceuticals?

B) |How |many |more |pounds |of |candy |will |a |consumer |purchase |if |the |price |of |candy |
decreases?

C) |What |is |the |future |inflation |rate |for |an |economy?

D) |How |much |capital |should |the |owner |of |a |business |use? |- |CORRECT |ANSWER✔✔-C) |What |is
|the |future |inflation |rate |for |an |economy?




Cupcakes |and |granola |bars |are |substitutes |in |consumption. |If |the |price |of |a |granola |bar |
decreases, |then |the |demand |for |_______ |and |its |demand |curve |will |shift |________



A) |cupcakes |will |increase; |rightward

B) |granola |bars |will |increase; |rightward

C) |cupcakes |will |decrease; |leftward

D) |granola |bars |will |decrease; |leftward |- |CORRECT |ANSWER✔✔-C) |Cupcakes |will |decrease; |
leftward



During |the |summer |you |have |made |the |decision |to |attend |summer |school, |which |prevents |
you |from |working |at |your |usual |summer |job |in |which |you |normally |earn |$4,500 |for |the |
summer. |Your |tuition |cost |is |$1,700 |and |books |and |supplies |cost |$700. |In |terms |of |dollars, |the |
opportunity |cost |of |attending |summer |school |is |



A) |$4,500

B) |$1,700

C) |$2,400

D) |$6,900 |- |CORRECT |ANSWER✔✔-D) |$6,900



As |time |passes |after |a |change |in |the |price, |the |supply |of |a |good |or |service |