Changes in regulations that decrease labor costs to employers are likel… Show more Multiple Choice Questions 1) Changes in regulations that decrease labor costs to employers are likely to: decrease firm profits increase the price of final goods increase employment increase the capital intesity of production 2) An increase in the demand for a product is most likely to result in a large price increase for the product if: the supply curve for the product is very inelastic the supply curve for the product is very elastic the good is produced using low priced inputs the good is produced using high priced inputs 2) A “public” good refers to: a good that is non-rival in consumption a good that is paid for by the government a good that is produced by a competitive industry a good that benefits public sector workers only 3) How does an increase in the price of leather (an input) affect the market for baseball gloves? supply increases, causing equilibrium price to decrease and equilibrium quantity to increase supply increases, causing equilibrium price to increase and equilibrium quantity to decrease supply decreases, causing equilibrium price to increase and equilibrium quantity to decrease supply decreases, causing equilibrium price to decrease and equilibrium quantity to increase 4) Economics is the social science concerned with: political agendas shortages profit how individuals, institutions, and society make optimal choices under conditions of scarcity fish and coconuts 5) Assume a perfectly competitive market is in competitive equilibrium. How would firms respond to an increase in costs? firms enter (supply increases) firms earn positive economic profit firms decrease q* initially equilibrium (market) quantity rises 6) When an unregulated negative externality exists: (Mark all that apply.) the market equilibrium output is less than the socially optimal level the marginal social cost exceeds the marginal social benefit the marginal social benefit exceeds the marginal social cost the market equilibrium output is greater than the socially optimal level 7) Which of the following is an effect of an increase in demand on a market in long run competitive equilibrium? firms decrease q initially, new firms enter, original firms decrease q firms decrease q initially, firms exit, original firms decrease q firms increase q initially, new firms enter, original firms decrease q firms increase q initially, firms exit, original firms decrease q 8) Which of the following will cause an increase in the long run cost curves? (Mark all that apply.) an increase in taxes an increase in the price of an input an improvement in technology 9) Em’s Eggs raises the price per unit from $1.50 to $2 and finds that total revenue decreases. Em’s price elasticity of demand coefficient is equal to 1 less than 1 greater than 1 10) Which of the following will shift the supply curve? (Mark all that apply.) change in the number of sellers change in the price of an input change in the price of a complement change in the price of a substitute • Show less