Question 1

Exhibit 5-1 2 B) P1 C) 0 D) It is not constant." class="answers-bank-image d-inline" rel="preload" >
Refer to Exhibit 5-1, which shows supply and demand for freeway space at both 8 a.m. and 11 p.m. Which toll creates equilibrium at 8 a.m.?

Accepted Answer

A)  P2
B)  P1
C)  0
D)  It is not constant.

Question 2

Exhibit 5-1 8a.m. to D11p.m. C) movement up along D8a.m. to the point where D8a.m. intersects the supply curve. D) leftward shift of the supply of freeway space curve." class="answers-bank-image d-inline" rel="preload" >
Refer to Exhibit 5-1, which shows supply and demand for freeway space at both 8 a.m. and 11 p.m. Suppose that the government decides to set the money price of driving on the freeway at zero, but creates programs that encourage drivers to carpool. If the carpooling program is sufficiently successful to eliminate the shortage of freeway space at 8 a.m., graphically the result of the increase in carpooling would be a

Accepted Answer

A)  rightward shift of the supply of freeway space curve.
B)  leftward shift of the demand for freeway space curve from D8a.m. to D11p.m.
C)  movement up along D8a.m. to the point where D8a.m. intersects the supply curve.
D)  leftward shift of the supply of freeway space curve.

Question 3

A toll of $1 per car is imposed on a road regardless of time of day. If the toll creates equilibrium travel flows at the busiest time of day, it will create a __________ at all other times.

Accepted Answer

A)  surplus of space
B)  shortage of space
C)  zero money price for space
D)  zero opportunity cost for space

Question 4

When congestion occurs on the freeway (because of a shortage of freeway space) , an economist would most likely explain this by saying that it is because

Accepted Answer

A)  the freeway has too few miles of roadway.
B)  there are too many cars.
C)  the price of driving on the freeway is below the equilibrium price.
D)  the freeway has too many miles of roadway.

Question 5

At college ABC and at college XYZ, students pay $15,000 less than the equilibrium tuition. If the supply of openings is the same at both colleges, it follows that a shortage of openings will be greater at

Accepted Answer

A)  college ABC than college XYZ.
B)  college ABC than the surplus at college XYZ.
C)  college XYZ than the surplus at college ABC.
D)  college ABC than college XYZ, if the demand is greater at college ABC.
E)  college ABC than college XYZ, if the demand is less at college ABC.

Question 6

Good weather in cities such as San Diego

Accepted Answer

A)  is absolutely free for the residents of that city.
B)  is allocated using a weather market.
C)  imposes indirect payments for the residents of that city.
D)  decreases the supply of housing in those cities.

Question 7

If there is freeway congestion at 8 a.m., we can reduce (or eliminate) the congestion by

Accepted Answer

A)  building more freeways.
B)  lowering the price to drive on the freeway at 8 a.m.
C)  discouraging workers from carpooling.
D)  discouraging workers from using public transportation.

Question 8

If the supply of aisle seats and middle seats on an airplane is the same, but the demand for aisle seats is greater than the demand for middle seats, then the equilibrium price of aisle seats will be less than the equilibrium price of middle seats.

Accepted Answer

A) True 
 B)False  False

Question 9

To an economist, freeway congestion is a sign that the price to drive on the freeway is

Accepted Answer

A)  below its equilibrium level.
B)  at its equilibrium level.
C)  above its equilibrium level.
D)  too high.

Question 10

If more people join carpools and travel to work together the

Accepted Answer

A)  demand curve for freeway space shifts leftward.
B)  supply curve for freeway space shifts rightward.
C)  supply curve for freeway space shifts leftward.
D)  demand curve for freeway space shifts rightward.

Question 11

The NCAA rule governing the limits on the amount of a scholarship a college can offer an athlete is an effective price floor.

Accepted Answer

A) True 
 B)False

Question 12

If the government sets out to make home buying easier for more people by forcing lenders to accept ____________ down payments and ______________ interest rates, the result will likely be a(n) _______________ in housing prices.

Accepted Answer

A)  lower; lower; increase
B)  higher; higher; increase
C)  lower; higher; decrease
D)  higher; lower; decrease

Question 13

Suppose that there are two laws proposed for eviction notices: Plan A requires landlords to give a renter 30 days to vacate an apartment once he has been served an eviction notice and Plan B requires landlords to give a renter 60 days to vacate an apartment once he has been served an eviction notice. It follows that landlords will find

Accepted Answer

A)  Plan A more expensive than Plan B.
B)  Plan B more expensive than Plan A.
C)  both plans to be equally expensive.
D)  Plan A to be so expensive that there is no incentive to invest in rental properties.

Question 14

Exhibit 5-3

Refer to Exhibit 5-3 which shows the demand and supply of a college athlete.  Suppose that NCAA rules limit the amount that the college can pay this athlete, such that their payment can not exceed the cost of attending the college (currently $8,000) .  The impact of this ruling would be a loss of income to the athlete of __________ and an equal gain in consumers' surplus to the college represented by ________________.

Accepted Answer

A)  $2,000; area 2
B)  $8,000; area 3
C)  $10,000; area 2 + 3
D)  $2,000; area 1 + 2 A

Question 15

Exhibit 5-2

Refer to Exhibit 5-2. There will need to be some kind of non-price rationing device used for both 8 a.m. classes and 10 a.m. classes if the tuition is set

Accepted Answer

A)  at $50.
B)  at $70.
C)  greater than $50 and less than $70.
D)  greater than $70. C

Question 16

Exhibit 5-5
2 for both aisle seats and middle seats, the result will be A) a surplus of middle seats and the equilibrium quantity of aisle seats. B) a surplus of aisle seats and the equilibrium quantity of middle seats. C) a shortage of middle seats and the equilibrium quantity of aisle seats. D) a shortage of aisle seats and the equilibrium quantity of middle seats." class="answers-bank-image d-inline" rel="preload" >
Refer to Exhibit 5-5. If the airline charges price P2 for both aisle seats and middle seats, the result will be

Accepted Answer

A)  a surplus of middle seats and the equilibrium quantity of aisle seats.
B)  a surplus of aisle seats and the equilibrium quantity of middle seats.
C)  a shortage of middle seats and the equilibrium quantity of aisle seats.
D)  a shortage of aisle seats and the equilibrium quantity of middle seats.

Question 17

The price of a given good is likely to be less variable with speculators than it would be without speculators.

Accepted Answer

A) True 
 B)False

Question 18

Exhibit 5-1 2 creates __________ at 8 a.m. and __________ at 11 p.m. A) a shortage; a surplus B) a surplus; a shortage C) equilibrium; a surplus D) a shortage; equilibrium" class="answers-bank-image d-inline" rel="preload" >
Refer to Exhibit 5-1, which shows supply and demand for freeway space at both 8 a.m. and 11 p.m. A toll of P2 creates __________ at 8 a.m. and __________ at 11 p.m.

Accepted Answer

A)  a shortage; a surplus
B)  a surplus; a shortage
C)  equilibrium; a surplus
D)  a shortage; equilibrium

Question 19

When universities charge students less than the equilibrium tuition for admission, they have to impose some nonprice-rationing device.

Accepted Answer

A) True 
 B)False

Question 20

The lower the price of medical care in general, the higher the ____________________________ medical care and the ______________________ specific items that make up medical care (such as x-rays) .

Accepted Answer

A)  quantity demanded of; higher the demand for
B)  demand for; higher the demand for
C)  quantity demanded of; lower the demand for
D)  demand for; higher the quantity demanded of

Exam 5: Supply, Demand, and Price: Applications

Exhibit 5-1 Refer to Exhibit 5-1, which shows supply and demand for freeway space at both 8 a.m. and 11 p.m. Which toll creates equilibrium at 8 a.m.?

Correct Answer
verified

Correct Answer
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A toll of $1 per car is imposed on a road regardless of time of day. If the toll creates equilibrium travel flows at the busiest time of day, it will create a __________ at all other times.

Correct Answer
verified

When congestion occurs on the freeway (because of a shortage of freeway space) , an economist would most likely explain this by saying that it is because

Correct Answer
verified

At college ABC and at college XYZ, students pay $15,000 less than the equilibrium tuition. If the supply of openings is the same at both colleges, it follows that a shortage of openings will be greater at

Correct Answer
verified

Good weather in cities such as San Diego

Correct Answer
verified

If there is freeway congestion at 8 a.m., we can reduce (or eliminate) the congestion by

Correct Answer
verified

If the supply of aisle seats and middle seats on an airplane is the same, but the demand for aisle seats is greater than the demand for middle seats, then the equilibrium price of aisle seats will be less than the equilibrium price of middle seats.

Correct Answer
verified
False

To an economist, freeway congestion is a sign that the price to drive on the freeway is

Correct Answer
verified

If more people join carpools and travel to work together the

Correct Answer
verified

The NCAA rule governing the limits on the amount of a scholarship a college can offer an athlete is an effective price floor.

Correct Answer
verified

If the government sets out to make home buying easier for more people by forcing lenders to accept down payments and interest rates, the result will likely be a(n) _____ in housing prices.

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
A

Exhibit 5-2 Refer to Exhibit 5-2. There will need to be some kind of non-price rationing device used for both 8 a.m. classes and 10 a.m. classes if the tuition is set

Correct Answer
verified
C

Exhibit 5-5 Refer to Exhibit 5-5. If the airline charges price P₂ for both aisle seats and middle seats, the result will be

Correct Answer
verified

The price of a given good is likely to be less variable with speculators than it would be without speculators.

Correct Answer
verified

Exhibit 5-1 Refer to Exhibit 5-1, which shows supply and demand for freeway space at both 8 a.m. and 11 p.m. A toll of P₂ creates at 8 a.m. and at 11 p.m.

Correct Answer
verified

When universities charge students less than the equilibrium tuition for admission, they have to impose some nonprice-rationing device.

Correct Answer
verified

The lower the price of medical care in general, the higher the ______ medical care and the specific items that make up medical care (such as x-rays) .

Correct Answer
verified

Exam 5: Supply, Demand, and Price: Applications

Exhibit 5-1 Refer to Exhibit 5-1, which shows supply and demand for freeway space at both 8 a.m. and 11 p.m. Which toll creates equilibrium at 8 a.m.?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A toll of $1 per car is imposed on a road regardless of time of day. If the toll creates equilibrium travel flows at the busiest time of day, it will create a __________ at all other times.

Correct AnswerverifiedShow Answer

When congestion occurs on the freeway (because of a shortage of freeway space) , an economist would most likely explain this by saying that it is because

Correct AnswerverifiedShow Answer

At college ABC and at college XYZ, students pay $15,000 less than the equilibrium tuition. If the supply of openings is the same at both colleges, it follows that a shortage of openings will be greater at

Correct AnswerverifiedShow Answer

Good weather in cities such as San Diego

Correct AnswerverifiedShow Answer

If there is freeway congestion at 8 a.m., we can reduce (or eliminate) the congestion by

Correct AnswerverifiedShow Answer

If the supply of aisle seats and middle seats on an airplane is the same, but the demand for aisle seats is greater than the demand for middle seats, then the equilibrium price of aisle seats will be less than the equilibrium price of middle seats.

Correct AnswerverifiedFalse

To an economist, freeway congestion is a sign that the price to drive on the freeway is

Correct AnswerverifiedShow Answer

If more people join carpools and travel to work together the

Correct AnswerverifiedShow Answer

The NCAA rule governing the limits on the amount of a scholarship a college can offer an athlete is an effective price floor.

Correct AnswerverifiedShow Answer

If the government sets out to make home buying easier for more people by forcing lenders to accept ____________ down payments and ______________ interest rates, the result will likely be a(n) _______________ in housing prices.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct AnswerverifiedA

Exhibit 5-2 Refer to Exhibit 5-2. There will need to be some kind of non-price rationing device used for both 8 a.m. classes and 10 a.m. classes if the tuition is set

Correct AnswerverifiedC

Exhibit 5-5 Refer to Exhibit 5-5. If the airline charges price P2 for both aisle seats and middle seats, the result will be

Correct AnswerverifiedShow Answer

The price of a given good is likely to be less variable with speculators than it would be without speculators.

Correct AnswerverifiedShow Answer

Exhibit 5-1 Refer to Exhibit 5-1, which shows supply and demand for freeway space at both 8 a.m. and 11 p.m. A toll of P2 creates __________ at 8 a.m. and __________ at 11 p.m.

Correct AnswerverifiedShow Answer

When universities charge students less than the equilibrium tuition for admission, they have to impose some nonprice-rationing device.

Correct AnswerverifiedShow Answer

The lower the price of medical care in general, the higher the ____________________________ medical care and the ______________________ specific items that make up medical care (such as x-rays) .

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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False

Correct Answer
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Correct Answer
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Correct Answer
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If the government sets out to make home buying easier for more people by forcing lenders to accept down payments and interest rates, the result will likely be a(n) _____ in housing prices.

Correct Answer
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Correct Answer
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Correct Answer
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A

Correct Answer
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C

Exhibit 5-5 Refer to Exhibit 5-5. If the airline charges price P₂ for both aisle seats and middle seats, the result will be

Correct Answer
verified

Correct Answer
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Exhibit 5-1 Refer to Exhibit 5-1, which shows supply and demand for freeway space at both 8 a.m. and 11 p.m. A toll of P₂ creates at 8 a.m. and at 11 p.m.

Correct Answer
verified

Correct Answer
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The lower the price of medical care in general, the higher the ______ medical care and the specific items that make up medical care (such as x-rays) .

Correct Answer
verified