Question

5)

Which of the following is likely to lead to a right shift in the supply curve of cotton?

5)

_______

1. A)
   

An increase in the price of cotton

1. B)
   

A decrease in the price of cotton

1. C)
   

An increase in labor productivity due to training programs

1. D)
   

A rise in labor costs due to wage demands by labor unions

6)

Assume that the supply curve for a commodity shifts to the left and the demand curve shifts to the right, both by the same degree. Then, in comparison to the initial equilibrium, the new equilibrium will be characterized by:

6)

_______

1. A)
   

a higher price and the same quantity.

1. B)
   

a lower price and the same quantity.

1. C)
   

the same price and quantity.

1. D)
   

a lower price and quantity.

7)

Which of the following is likely to cause the demand curve for cars to shift to the left?

7)

_______

1. A)
   

An increase in the economy's national income

1. B)
   

An increase in the cost of production leading to an increase in the price of cars

1. C)
   

A rise in the price of gasoline

1. D)
   

A rise in the price of cars

8)

Other things remaining the same, a right shift in the supply curve will lead to:

8)

_______

1. A)
   

a decrease in the equilibrium price and an increase in the equilibrium quantity.

1. B)
   

a decrease in the equilibrium price and the equilibrium quantity.

1. C)
   

an increase in the equilibrium price and a decrease in the equilibrium quantity.

1. D)
   

an increase in the equilibrium price and the equilibrium quantity.

Answer 1

a) "

"C" An increase in labor productivity due to training programs.

b)

"A"

the new equilibrium will be at a higher price and same level of output in the market.

c) "C" a rise in the price of gasoline will shift the demand for car to the left.

d) "A"

this will lower the price level and increase the quantity in the market.