MacroEconomics Practice Problems, Chapter 3

MacroEconomics Practice Problems, Chapter 3 -...

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Practice Problems: Chapter 3 Question 1  (1 point)   What describes the competitive market best? Question 1 options: The government controls the allocation of inputs in production. There are many buyers and sellers of the same good. One firm controls production of all goods in an industry. Firms cooperate in setting the price of a good. Question 2  (1 point)   If the price of a pound of Kenyan coffee decreases from $12 a pound to $10 a pound, we can expect  an: Question 2 options: inward shift in the supply curve of Kenyan coffee. increase in the quantity supplied of Kenyan coffee. inward shift in the demand curve for Kenyan coffee. increase in the quantity demanded of Kenyan coffee. Question 3  (1 point)   If coffee sold at Starbucks is a normal good, then an increase in income will: Question 3 options: increase the supply of Starbucks coffee. decrease the supply of Starbucks coffee. increase the demand for Starbucks coffee. decrease the demand for Starbucks coffee. Question 4  (1 point)   If air travel to Hawaii becomes less expensive, what is likely to happen in the market for hotel rooms  in Hawaii? Question 4 options:
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The demand curve for hotel rooms will shift inward. The demand curve for hotel rooms will shift outward. The supply curve for hotel rooms will shift inward. The supply curve for hotel rooms will shift outward. Question 5  (1 point)   Consider the market for kayaks. What happens when the process of manufacturing kayaks becomes  less costly through the use of new technology? Question 5 options: The demand curve for kayaks will shift inward. The demand curve for kayaks will shift outward. The supply curve for kayaks will shift inward. The supply curve for kayaks will shift outward. Question 6  (1 point)   How would an increase in the price of cotton affect the market for cotton T-shirts at your university  bookstore? Question 6 options: The demand curve for cotton T-shirts will shift inward.
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