Question

1- If the price of a good is below the equilibrium price, this will:

a- Shift the demand curve down.

b- Create a surplus.

c- Create a shortage.

d- Have no effect.

How would an outward shift in demand affect the market equilibrium?

Group of answer choices

a- Equilibrium price and quantity would decrease.

b- Equilibrium price and quantity would increase

c- Equilibrium price would decrease; equilibrium quantity would increase.

d- Equilibrium price would increase; equilibrium quantity would decrease.

e- No effect.

3- John Deere sells agricultural machinery in an oligopolistic market. What is a characteristic that accurately describes this market?

a-John Deere does not have a lot of influence over market volume and price.

b-There are only a few other companies that sell products similar to those of John Deere.

c-There is nothing hindering new companies from selling agricultural machinery in the market.

d-John Deere is the only manufacturer of agricultural machinery.

4- In a county in Indiana, there are hundreds of cattle farmers trying to sell to the only meat packing plant in the area. In this county, the sellers are operating under ___________, while the buyer is operating under a ____________.

a-Perfect competition; monopoly

b-Monopsony; perfect competition

c-Perfect competition; monopsony

d-Monopolistic competition; monopsony

Which of the following is NOT true about total economic surplus?

a-It equals consumer surplus plus producer surplus

b-It measures economic wellbeing.

c-It includes deadweight loss.

d-It is maximized in perfectly competitive markets.

Answer 1

1. Option c. As quantity demand exceeds quantity supply

2. Option c. As demand increases both quantity and price increases

3. Option b. Oligopolistic market is characterised by few players

4. Option a. Monopsony is only a buyer whereas perfect competition many sellers

\5. Option b