Entrepreneur, Shoes, Increase, Quantity, Income, Principles of Macroeconomics Quiz3
The key terms in this Principles of Macroeconomics course include Entrepreneur, Shoes, Increase, Quantity, Income, Springs, Principles of Macroeconomics – Quiz
You’re an entrepreneur and had a great idea to sell shoes that have springs installed in them to make walking easier. However, the development costs were so high that the shoes are priced 15 times higher than shoes without springs. As a result, many of the shoes have gone unsold.
What possible event could eliminate the disequilibrium in the market for shoes?
There is an increase in income and “spring shoes” are an inferior good.
There is an increase in income and “spring shoes” are a normal good.
There is a decrease in the price of rubber, which is an input in the production of shoes.
A study reveals that shoes with a spring can increase the chance of a broken leg.
Explanation:
When there are too many spring shoes available, what is revealed is a surplus, where quantity supplied is greater than quantity demanded. On a graph, a surplus is illustrated with a horizontal line above the equilibrium point. The surplus can be removed as quantity demanded increases or when quantity supplied falls. In this case, an increase in income increases the demand for normal goods like spring shoes, thus removing the surplus.
People often clean cabinet doors, but do not regularly clean inside the cabinet. The insides of cabinets aren’t visible and require the removal of contents in order to clean. This is an example of ________ thinking.
marginal
dismal
incentive
deferential
conscientious
Macroeconomics is the study of
the economic motives of voters and elected officials.
the interaction between the government and businesses.
the operation of the economy as a whole.
individual decision-making units such as households and businesses.
how government purchases affect specific markets.
You’re an entrepreneur and had a great idea to sell shoes that have springs installed in them to make walking easier. However, the development costs were so high that the shoes are priced 15 times higher than shoes without springs. As a result, many of the shoes have gone unsold.
What possible event could eliminate the disequilibrium in the market for shoes?
There is an increase in income and “spring shoes” are an inferior good.
There is an increase in income and “spring shoes” are a normal good.
There is a decrease in the price of rubber, which is an input in the production of shoes.
A study reveals that shoes with a spring can increase the chance of a broken leg.
Explanation:
When there are too many spring shoes available, what is revealed is a surplus, where quantity supplied is greater than quantity demanded. On a graph, a surplus is illustrated with a horizontal line above the equilibrium point. The surplus can be removed as quantity demanded increases or when quantity supplied falls. In this case, an increase in income increases the demand for normal goods like spring shoes, thus removing the surplus.
People often clean cabinet doors, but do not regularly clean inside the cabinet. The insides of cabinets aren’t visible and require the removal of contents in order to clean. This is an example of ________ thinking.
marginal
dismal
incentive
deferential
conscientious
Macroeconomics is the study of
the economic motives of voters and elected officials.
the interaction between the government and businesses.
the operation of the economy as a whole.
individual decision-making units such as households and businesses.
how government purchases affect specific markets.