ECO 365T Wk 2 – Practice Knowledge Check

1.

If government set a minimum price of $50 in the market, a

2.When there is overproduction of a good,

3.Consumer surplus

4. If the market price of a product increases, then the total

5.

Which of the diagrams illustrate(s) the effect of a decrease in incomes on the market for second-hand clothing?

6. A fall in the price of milk, used in the production of ice cream, will

7.

.

Refer to the provided supply and demand graph of Product X. If there are positive externalities from the consumption of Product X, then the socially optimal demand curve would be

8.If there was initially a shortage in the market for a product, then

9. (Consider This) When you enter a congested roadway,

10. What would best explain why the equilibrium price of pink salmon decreased and the equilibrium quantity increased?

11.Which of the following conditions does not need to occur for a market to achieve allocative efficiency?

12.

Refer to the table. In relation to column (3), a change from column (1) to column (2) would mostly likely be caused by

13.Product reviews help to alleviate problems associated with

14.An increase in demand for oil along with a simultaneous increase in supply of oil will

15. In a free-market economy, a product which entails a positive externality will be

16. The idea of the Law of Demand, as applied to electric cars, assumes which of the following to be constant?

17. Which would be a likely cause of an increase in the demand for pizza?

18. Antipollution policies can be severe in their design and implementation, resulting

19.

Refer to the diagram. From society’s perspective, if MB1 and MC2 are relevant,

20.Which of the following would be an example of a moral hazard problem?