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AP MACRO Week 2 Practice Quiz: E, 7 11

Tip, draw graphs when necessary to help you work out the answers. (Consider using scratch paper and attach it to this
sheet.)

1.

An increase in the wages of textile workers will most

likely lead to which of the following?
(A) an increase in the demand for textiles
(B) a decrease in the demand for textiles
(C) an increase in the supply of textiles
(D) a decrease in the supply of textiles
(E) an increase in both the supply and demand for
textiles

2. If an increase in the price of good X leads to a decrease

in the demand for good Y, which of the following
must be true?
(A) X is a normal good.
(B) Y is an inferior good.
(C) Both X and Y are normal goods.
(D) X and Y are complements.
(E) X and Y are substitutes.

3. If both supply and demand for a good increase, which

of the following is true?
(A) Price will increase.
(B) Price will decrease.
(C) Quantity will increase.
(D) Quantity will decrease.
(E) Quantity may increase, decrease, or remain the
same.

4. Which of the following will lead to a decrease in the

price of a product?
(A) a decrease in income and an increase in wages
(B) an increase in population and an increase in input
prices
(C) an increase in consumer preferences for the
product and improvement in production
technology
(D) a decrease in the price of a substitute product and
an improvement in production technology
(E) a decrease in the price of a complement product
and an increase in the price of an input

5. There has just been a salmonella outbreak caused by

the consumption of contaminated eggs. Which of the
following changes in the egg market is most likely to
occur as a result?
(A) The supply curve will shift to the right, increasing
the price of eggs.
(B) The supply curve will shift to the right, decreasing
the price of eggs.
(C) The demand curve will shift to the left, decreasing
the price of eggs.
(D) The demand curve will shift to the right,
increasing the price of eggs.
(E) Neither the supply nor the demand curve will
shift; quantity will increase and price will
decrease.

6. In a competitive market, which of the following

changes in supply and demand will cause both the
equilibrium price and quantity to increase?
Supply Curve; Demand Curve
(A)Decrease; Decrease
(B)Decrease; No change
(C)Increase; Increase
(D)No change; Increase
(E)Increase; Decrease

7. If a market is in equilibrium, which of the following

will cause both price and quantity to fall?
(A) an increase in demand
(B) an increase in supply
(C) a decrease in demand
(D) a decrease in supply
(E) a decrease in both demand and supply

AP MACRO Week 2 Practice Quiz: E, 7 11

8. Which of the following would shift the supply curve
for a good to the left?
(A) an increase in price
(B) an advance in production technology
(C) a decrease in consumer income if the good were a
normal good
(D) an increase in the cost of a production input
(E) an increase in the number of suppliers of the good

12. A decrease in raw material prices will change the

equilibrium price and quantity in a market in which of
the following ways?
Price; Quantity
(A) Increase; Increase
(B) Increase; Decrease
(C) Decrease; Increase
(D) Decrease; Decrease
(E) No change; Increase

9. Which of the following is most likely to increase the

demand for pencils? A decrease in
(A) the price of lead.
(B) the price of pens
(C) the price of paper
(D) consumer income
(E) the price of pencils

13. When labor supply in a competitive labor market

increases, the equilibrium wage rate and employment
will change in which of the following ways?
Wage Rate; Employment
(A) Increase; Increase
(B) Increase; Decrease
(C) Decrease; Increase
(D) Decrease; Decrease
(E) Decrease; No change

10. What are the effects on the supply and demand curves
for Frisbees if a new procedure reduces the cost of
making Frisbees?
Demand Curve; Supply Curve
(A) Shifts right; Shifts right
(B) No change; Shifts left
(C) No change; Shifts right
(D) Shifts left; Shifts right
(E) Shifts right; Shifts left
11. In the same period there is a drought affecting the
supply of pineapples and a discovery that they assist
in the avoidance of cancer. How will this combination
of events affect the equilibrium price and quantity of
pineapples?
Equilibrium Price Equilibrium Quantity
(A) Increases
Decreases
(B) Increases
Indeterminate
(C) Indeterminate
Increases
(D) Decreases
Indeterminate
(E) Increases
Increases

14. Which of the following changes in the demand for

and the supply of a good will necessarily result in an
increase in both the equilibrium price and quantity of
the good in a market?
Demand; Supply
(A) Increase; Increase
(B) Increase; No change
(C) No change; Increase
(D) Decrease; Increase
(E) No change; Decrease
15. A decrease in the supply of oranges raised the price of
oranges in the market. The substitution effect of the
price increase will motivate consumers to
(A) raise their real income to offset the price effect
(B) decrease their demand for oranges
(C) demand that the government set a price ceiling for
oranges
(D) increase the quantity of other fruits demanded and
decrease the quantity of oranges demanded.
(E) decrease the quantity of other fruits demand and
increase the quantity of oranges demande d