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AP Economics:
Demand and Supply Review MCs
May 2, 2014
1. Which of the following will not change the demand for oranges?
a. A change in consumers’ incomes
b. A change in the price of grapefruits, a substitute for oranges
c. A change in the price of oranges
d. A change in consumers’ taste for oranges
e. An expectation that the price of oranges will change in the future
2. A downward sloping demand curve can be explained by
i. Diminishing marginal utility
ii. Diminishing marginal returns
iii. The substitution effect
iv. The income effect
b. I only
c. II only
d. I and III only
e. I and IV only
f. I, III and IV only
3. A marketing survey shows that gate receipts would increase if the price of tickets to a
summer rock concert increased, even though the number of tickets sold would fall.
What does this imply about the price elasticity of demand for concert tickets?
a. Demand is inelastic
b. Demand is elastic
c. Demand is unit elastic
d. Demand is perfectly inelastic
e. Demand is perfectly elastic
4. If hot dogs are an inferior good, an increase in income will result in
a. An increase in the quantity demanded for hot dogs
b. An increase in the demand for hot dogs
c. A decrease in the quantity demanded for hot dogs
d. A decrease in the demand for hot dogs
e. No change in the demand for hot dogs
5. According to the graph above, which of the following will occur if this legal price ceiling
is imposed?
a. Shortages will occur
b. Surpluses will occur
c. Demand will increase
d. Quantity B will be purchased
e. Supply will decrease
6. The market price of a good will tend to rise if
a. Demand increases
b. Supply increases
c. It is above the equilibrium price
d. It is below the equilibrium price
e. Demand shifts to the left
7. Which of the following is certainly true if demand and supply increase at the same time?
a. The equilibrium price will increase
b. The equilibrium price will decrease
c. The equilibrium quantity will increase
d. The equilibrium quantity will decrease
e. The equilibrium quantity may increase, decrease, or stay the same
8. Which of the following would decrease the effect of the above quota on mopeds?
a. Decrease in demand
b. Increase in supply
c. Increase in demand
d. Price ceiling above the equilibrium price
e. None of the above
9. Consumer surplus is found as the area
a. Above the supply curve and below the price
b. Below the demand curve and above the price
c. Above the demand curve and below the price
d. Below the supply curve and above the price
e. Below the supply curve and above the demand curve
10. An excise tax will be paid mainly by producers when
a. It is imposed on producers
b. It is imposed on consumers
c. The price elasticity of supply is low and the price elasticity of demand is high
d. The price elasticity of supply is high and the price elasticity of demand is low
e. The price elasticity of supply is perfectly elastic