MBA 701 Exam 1: Questions With Correct Solutions
If the price of a good or service exceeds the equilibrium price, a _____ exists. As
a result, price tends to _____. Correct Answer - surplus;fall
What type of price control will the government impose if it considers the
equilibrium price to be too high? Correct Answer - Price Celing
Other things remaining constant, when demand for a good or service
increases, which of the following occur(s)?
-Equilibrium quantity is unchanged
-Equilibrium price increases
-Equilibrium price decreases
-Equilibrium quantity increases Correct Answer - Equilibrium price
increases
Equilibrium quantity increases
True or false: When a price floor applies to a product, rather than labor, the
deadweight loss will always be less. Correct Answer - False
Which of the following occur(s) when the supply of a good or service
decreases and demand remains the same?
Multiple select question.
-Equilibrium quantity increases
-Equilibrium quantity decreases
-Equilibrium price increases
-Equilibrium price decreases Correct Answer - Equilibrium quantity
decreases
Equilibrium price increases
Comparative static analysis assumes which of the following?
-Goods are allocated by quantity
-No price floors
-Goods are allocated by price
-No price ceilings Correct Answer - No price floors
Goods are allocated by price
No price ceilings
,If the price of a good or service is less than the equilibrium price, a _____ exists.
As a result, the price tends to _____. Correct Answer - shortage; rise
Determine the effect in the market for chicken if the federal government
subsidizes chicken production and, at the same time, the price of pork, a
substitute, decreases. Correct Answer - Equilibrium price decreases.
The effect on equilibrium quantity is uncertain.
Other things remaining constant, when demand for a good or service
decreases, which of the following occur(s)?
Equilibrium quantity decreases
Equilibrium price decreases
Equilibrium price is unchanged
Equilibrium quantity increases Correct Answer - Equilibrium quantity
decreases
Equilibrium price decreases
Which of the following occur(s) when the supply of a good or service
increases but the demand remains the same?
Multiple select question.
Equilibrium price increases
Equilibrium quantity increases
Equilibrium quantity decreases
Equilibrium price decreases Correct Answer - Equilibrium quantity
increases
Equilibrium price decreases
What type of analysis studies the movement from one equilibrium to another?
Correct Answer - Comparative static analysis
Other things remaining constant, when demand for a good or service
increases, which of the following occur(s)?
Multiple select question.
Equilibrium price increases
Equilibrium quantity is unchanged
Equilibrium price decreases
Equilibrium quantity increases Correct Answer - Equilibrium price
increases
Equilibrium quantity increases
, Suppose there is an increase in the price of pork. If chicken is a substitute for
pork, what can producers and consumers of chicken expect to see in the
market for chicken?
Multiple select question.
An increase in the price of chicken
A decrease in the quantity of chicken purchased
A decrease in the price of chicken
An increase in the quantity of chicken purchased Correct Answer - An
increase in the price of chicken
An increase in the quantity of chicken purchased
When a price floor is applied to a product and the government buys and
discards the resulting surplus, the deadweight loss from the price floor
_________. Correct Answer - becomes larger
Determine the effect in the market for chicken if the federal government
subsidizes chicken production and, at the same time, the price of pork, a
substitute, decreases.
Multiple select question.
The effect on equilibrium quantity is uncertain.
Equilibrium price increases.
The effect on equilibrium price is uncertain.
Equilibrium price decreases. Correct Answer - The effect on equilibrium
quantity is uncertain.
Equilibrium price decreases.
Other things remaining constant, when demand for a good or service
decreases, which of the following occur(s)?
Equilibrium quantity decreases
Equilibrium price decreases
Equilibrium quantity increases
Equilibrium price increases Correct Answer - Equilibrium quantity
decreases
Equilibrium price decreases
Indicate which of the following events occur(s) in the market for dark
chocolate when the government imposes a strict tariff on imported cocoa AND
If the price of a good or service exceeds the equilibrium price, a _____ exists. As
a result, price tends to _____. Correct Answer - surplus;fall
What type of price control will the government impose if it considers the
equilibrium price to be too high? Correct Answer - Price Celing
Other things remaining constant, when demand for a good or service
increases, which of the following occur(s)?
-Equilibrium quantity is unchanged
-Equilibrium price increases
-Equilibrium price decreases
-Equilibrium quantity increases Correct Answer - Equilibrium price
increases
Equilibrium quantity increases
True or false: When a price floor applies to a product, rather than labor, the
deadweight loss will always be less. Correct Answer - False
Which of the following occur(s) when the supply of a good or service
decreases and demand remains the same?
Multiple select question.
-Equilibrium quantity increases
-Equilibrium quantity decreases
-Equilibrium price increases
-Equilibrium price decreases Correct Answer - Equilibrium quantity
decreases
Equilibrium price increases
Comparative static analysis assumes which of the following?
-Goods are allocated by quantity
-No price floors
-Goods are allocated by price
-No price ceilings Correct Answer - No price floors
Goods are allocated by price
No price ceilings
,If the price of a good or service is less than the equilibrium price, a _____ exists.
As a result, the price tends to _____. Correct Answer - shortage; rise
Determine the effect in the market for chicken if the federal government
subsidizes chicken production and, at the same time, the price of pork, a
substitute, decreases. Correct Answer - Equilibrium price decreases.
The effect on equilibrium quantity is uncertain.
Other things remaining constant, when demand for a good or service
decreases, which of the following occur(s)?
Equilibrium quantity decreases
Equilibrium price decreases
Equilibrium price is unchanged
Equilibrium quantity increases Correct Answer - Equilibrium quantity
decreases
Equilibrium price decreases
Which of the following occur(s) when the supply of a good or service
increases but the demand remains the same?
Multiple select question.
Equilibrium price increases
Equilibrium quantity increases
Equilibrium quantity decreases
Equilibrium price decreases Correct Answer - Equilibrium quantity
increases
Equilibrium price decreases
What type of analysis studies the movement from one equilibrium to another?
Correct Answer - Comparative static analysis
Other things remaining constant, when demand for a good or service
increases, which of the following occur(s)?
Multiple select question.
Equilibrium price increases
Equilibrium quantity is unchanged
Equilibrium price decreases
Equilibrium quantity increases Correct Answer - Equilibrium price
increases
Equilibrium quantity increases
, Suppose there is an increase in the price of pork. If chicken is a substitute for
pork, what can producers and consumers of chicken expect to see in the
market for chicken?
Multiple select question.
An increase in the price of chicken
A decrease in the quantity of chicken purchased
A decrease in the price of chicken
An increase in the quantity of chicken purchased Correct Answer - An
increase in the price of chicken
An increase in the quantity of chicken purchased
When a price floor is applied to a product and the government buys and
discards the resulting surplus, the deadweight loss from the price floor
_________. Correct Answer - becomes larger
Determine the effect in the market for chicken if the federal government
subsidizes chicken production and, at the same time, the price of pork, a
substitute, decreases.
Multiple select question.
The effect on equilibrium quantity is uncertain.
Equilibrium price increases.
The effect on equilibrium price is uncertain.
Equilibrium price decreases. Correct Answer - The effect on equilibrium
quantity is uncertain.
Equilibrium price decreases.
Other things remaining constant, when demand for a good or service
decreases, which of the following occur(s)?
Equilibrium quantity decreases
Equilibrium price decreases
Equilibrium quantity increases
Equilibrium price increases Correct Answer - Equilibrium quantity
decreases
Equilibrium price decreases
Indicate which of the following events occur(s) in the market for dark
chocolate when the government imposes a strict tariff on imported cocoa AND
