ECON 2102 Test 1 Questions and Answers Already Passed Latest Update 2025-2026
1. If corn products are found to cause cancer, then the
a. Demand curve for corn will shift left
b. Supply curve for corn will shift left
c. Supply curve for corn with shift right
d. None of the choices are correct - Answers a. Demand curve for corn will shift left
1. Firms in Colorado dump waste into the Colorado River and as a result, people in California
and Mexico cannot use the water. What type of market failure is most likely involved?
a. Inequality
b. Market power
c. Public goods
d. Externalities - Answers Externalities
1. Which of the following is not a basic decision that all nations must confront?
a. Should we have economic growth?
b. How should we produce goods and services?
c. What goods and services should we produce?
d. For whom should goods and services be produced? - Answers a. Should we have economic
growth?
1. If the actual market price were fixed at $15 per unit in Figure 3.2,
a. There would be a shortage of 40 units
b. There would be a surplus of 40 units
c. There would be a surplus of 20 units
d. There would be a shortage of 20 units - Answers a. There would be a surplus of 40 units
1. Refer to Figure 1.7. The cost of producing at point D rather than poin J is
a. AC units of food
b. OM units of clothing
, c. OA units of food
d. KM units of clothing - Answers a. KM units of clothing
1. A private good
a. Results in market failure when provided in markets characterized by laissez faire
b. Experiences free riders
c. Is provided most efficiently by the government
d. Is consumed by one person and excludes consumption by others - Answers a. Is consumed
by one person and excludes consumption by others
1. A market is said to be in equilibrium when
a. A demand is fully satisfied at all alternative prices
b. The buying intentions of all consumers are realized
c. They supply intentions of all sellers are realized
d. The quantity demanded equals the quantity supplied - Answers a. The quantity demanded
equals the quantity supplied
1. If the market wage for fast food restaurants is $4 and the government enforces a minimum
wage of $7, the unemployment rate will
a. Increase as quantity of labor supply increases and quantity of labor demand increases
b. Increases as quantity of labor supply decreases and quantity of labor demand increases
c. Increase as quantity of labor supply increases and quantity of labor demand decreases
d. Not be affected by minimum wage - Answers a. Increase as quantity of labor supply
increases and quantity of labor demand decreases
1. Which of the following is a sound economic reason why the government should subsidize
your college education?
a. The profit motive would cause the private sector to overproduce education
b. It is too expensive
c. To help the school's monopoly power over private schools
d. There are external benefits associated with education - Answers a. There are external
benefits associated with education
1. If corn products are found to cause cancer, then the
a. Demand curve for corn will shift left
b. Supply curve for corn will shift left
c. Supply curve for corn with shift right
d. None of the choices are correct - Answers a. Demand curve for corn will shift left
1. Firms in Colorado dump waste into the Colorado River and as a result, people in California
and Mexico cannot use the water. What type of market failure is most likely involved?
a. Inequality
b. Market power
c. Public goods
d. Externalities - Answers Externalities
1. Which of the following is not a basic decision that all nations must confront?
a. Should we have economic growth?
b. How should we produce goods and services?
c. What goods and services should we produce?
d. For whom should goods and services be produced? - Answers a. Should we have economic
growth?
1. If the actual market price were fixed at $15 per unit in Figure 3.2,
a. There would be a shortage of 40 units
b. There would be a surplus of 40 units
c. There would be a surplus of 20 units
d. There would be a shortage of 20 units - Answers a. There would be a surplus of 40 units
1. Refer to Figure 1.7. The cost of producing at point D rather than poin J is
a. AC units of food
b. OM units of clothing
, c. OA units of food
d. KM units of clothing - Answers a. KM units of clothing
1. A private good
a. Results in market failure when provided in markets characterized by laissez faire
b. Experiences free riders
c. Is provided most efficiently by the government
d. Is consumed by one person and excludes consumption by others - Answers a. Is consumed
by one person and excludes consumption by others
1. A market is said to be in equilibrium when
a. A demand is fully satisfied at all alternative prices
b. The buying intentions of all consumers are realized
c. They supply intentions of all sellers are realized
d. The quantity demanded equals the quantity supplied - Answers a. The quantity demanded
equals the quantity supplied
1. If the market wage for fast food restaurants is $4 and the government enforces a minimum
wage of $7, the unemployment rate will
a. Increase as quantity of labor supply increases and quantity of labor demand increases
b. Increases as quantity of labor supply decreases and quantity of labor demand increases
c. Increase as quantity of labor supply increases and quantity of labor demand decreases
d. Not be affected by minimum wage - Answers a. Increase as quantity of labor supply
increases and quantity of labor demand decreases
1. Which of the following is a sound economic reason why the government should subsidize
your college education?
a. The profit motive would cause the private sector to overproduce education
b. It is too expensive
c. To help the school's monopoly power over private schools
d. There are external benefits associated with education - Answers a. There are external
benefits associated with education
