Question 1

If A and B are substitutes and the price of A rises,we will observe

Accepted Answer

A) an increase in the equilibrium price and the equilibrium quantity of B. 
B) a decrease in the equilibrium price and the equilibrium quantity of B. 
C) an increase in the equilibrium price but a decrease in the equilibrium quantity of B. 
D) a decrease in equilibrium price but an increase in the equilibrium quantity of B. 
E) a decrease in the demand for A. 
A) an increase in the equilibrium price and the equilibrium quantity of B. 
B) a decrease in the equilibrium price and the equilibrium quantity of B. 
C) an increase in the equilibrium price but a decrease in the equilibrium quantity of B. 
D) a decrease in equilibrium price but an increase in the equilibrium quantity of B. 
E) a decrease in the demand for A.

Question 2

The price at which sellers are not willing to supply a good is $700 per unit.If the supply curve passes through the point (3,718),what is the equation of the supply curve?

Accepted Answer

A) P = 700 + 6QS 
B) QS = 700 - 6P 
C) P = 718 + 3QS 
D) QS = 718 + 3P 
E) QS = 718 - 6P 
A) P = 700 + 6QS 
B) QS = 700 - 6P 
C) P = 718 + 3QS 
D) QS = 718 + 3P 
E) QS = 718 - 6P

Question 3

Use the figure below to answer the following questions.   Figure 3.5.2
Original equilibrium at 1.
-Refer to Figure 3.5.2,which represents the market for beans.If the price of peas,a substitute for beans and a substitute in production,rises,what is the new beans equilibrium,ceteris paribus?

Accepted Answer

A) 2 
B) 3 
C) 9 
D) 4 
E) 7 
A) 2 
B) 3 
C) 9 
D) 4 
E) 7

Question 4

"As domestic car prices have increased,consumers have found foreign cars to be a better bargain.Consequently,domestic car sales have fallen and foreign car sales have risen." Based on this information alone,there has been a

Accepted Answer

A) shift in the demand curves for both domestic and foreign cars. 
B) shift in the supply curves for both domestic and foreign cars. 
C) movement along the demand curves for both domestic and foreign cars. 
D) movement along the demand curve for domestic cars and a shift of the demand curve for foreign cars. 
E) shift of the demand curve for domestic cars and a movement along the demand curve for foreign cars. 
A) shift in the demand curves for both domestic and foreign cars. 
B) shift in the supply curves for both domestic and foreign cars. 
C) movement along the demand curves for both domestic and foreign cars. 
D) movement along the demand curve for domestic cars and a shift of the demand curve for foreign cars. 
E) shift of the demand curve for domestic cars and a movement along the demand curve for foreign cars.

Question 5

The fact that a fall in the price of a good results in a decrease in the quantity of the good supplied illustrates

Accepted Answer

A) the law of supply. 
B) the law of demand. 
C) a change in supply. 
D) the nature of an inferior good. 
E) technological improvement. 
A) the law of supply. 
B) the law of demand. 
C) a change in supply. 
D) the nature of an inferior good. 
E) technological improvement.

Question 6

Use the table below to answer the following questions.
Table 3.5.1
The Market for Car-Seat Heaters
  
-Refer to Table 3.5.1.Suppose the cost of production rises and supply decreases by 100 units at each price.The new equilibrium price is $________ and equilibrium quantity is ________ units.

Accepted Answer

A) 70;450 
B) 70;350 
C) 50;450 
D) 50;350 
E) 60;400 
A) 70;450 
B) 70;350 
C) 50;450 
D) 50;350 
E) 60;400

Question 7

Use the figure below to answer the following questions.   Figure 3.5.1
-If the demand curve is D2 in Figure 3.5.1,

Accepted Answer

A) the equilibrium price is P2 and the equilibrium quantity is Q2. 
B) the equilibrium price is P2 and the equilibrium quantity is Q0. 
C) there is a shortage in the amount of Q2 - Q0. 
D) a rise in price will shift the demand curve to D3. 
E) the price will rise. 
A) the equilibrium price is P2 and the equilibrium quantity is Q2. 
B) the equilibrium price is P2 and the equilibrium quantity is Q0. 
C) there is a shortage in the amount of Q2 - Q0. 
D) a rise in price will shift the demand curve to D3. 
E) the price will rise.

Question 8

The price of good X falls and the demand for good Y decreases.We can conclude that

Accepted Answer

A) X and Y are complements. 
B) X and Y are substitutes in production. 
C) X is an inferior good. 
D) X is a normal good. 
E) X and Y are substitutes. 
A) X and Y are complements. 
B) X and Y are substitutes in production. 
C) X is an inferior good. 
D) X is a normal good. 
E) X and Y are substitutes.

Question 9

The relative price of a good is

Accepted Answer

A) the ratio of one price to another and an opportunity cost. 
B) the ratio of the price of a good to the income of the purchaser. 
C) a household's income divided by the number of goods purchased. 
D) the same as the money price of a good. 
E) the cost of its factors of production. 
A) the ratio of one price to another and an opportunity cost. 
B) the ratio of the price of a good to the income of the purchaser. 
C) a household's income divided by the number of goods purchased. 
D) the same as the money price of a good. 
E) the cost of its factors of production.

Question 10

If demand increases and supply decreases,then the

Accepted Answer

A) equilibrium quantity increases but the effect on the equilibrium price is unknown. 
B) equilibrium quantity decreases but the effect on the equilibrium price is unknown. 
C) equilibrium price falls but the effect on the equilibrium quantity is unknown. 
D) equilibrium price rises but the effect on the equilibrium quantity is unknown. 
E) effect on both equilibrium price and quantity is unknown. 
A) equilibrium quantity increases but the effect on the equilibrium price is unknown. 
B) equilibrium quantity decreases but the effect on the equilibrium price is unknown. 
C) equilibrium price falls but the effect on the equilibrium quantity is unknown. 
D) equilibrium price rises but the effect on the equilibrium quantity is unknown. 
E) effect on both equilibrium price and quantity is unknown.

Question 11

The price of a good will rise if

Accepted Answer

A) demand for the good decreases. 
B) supply of the good decreases. 
C) there is a surplus of the good. 
D) the price of a substitute for the good decreases. 
E) the good is an inferior good and income increases. 
A) demand for the good decreases. 
B) supply of the good decreases. 
C) there is a surplus of the good. 
D) the price of a substitute for the good decreases. 
E) the good is an inferior good and income increases.

Question 12

Suppose the price of a football is $40.00 and the price of a basketball is $20.00.The ________ of a football is ________.

Accepted Answer

A) relative price;2 basketballs per football 
B) relative price;1/2 basketball per football 
C) opportunity cost;$20.00 
D) opportunity cost;$2.00 
E) relative price;$10 
A) relative price;2 basketballs per football 
B) relative price;1/2 basketball per football 
C) opportunity cost;$20.00 
D) opportunity cost;$2.00 
E) relative price;$10

Question 13

Use the figure below to answer the following questions.   Figure 3.4.1
-At price P2 in Figure 3.4.1,which one of the following is not true?

Accepted Answer

A) This market is in equilibrium. 
B) The quantity demanded is equal to the quantity supplied. 
C) The quantity demanded is Q1. 
D) There is no surplus. 
E) The quantity supplied is Q3. 
A) This market is in equilibrium. 
B) The quantity demanded is equal to the quantity supplied. 
C) The quantity demanded is Q1. 
D) There is no surplus. 
E) The quantity supplied is Q3.

Question 14

Some sales managers are talking shop.Which one of the following quotations refers to a leftward shift of the demand curve?

Accepted Answer

A) "Since our competitors raised their prices,our sales have doubled." 
B) "It has been an unusually mild winter;our sales of wool scarves are down from last year." 
C) "We decided to cut our prices,and the increase in our sales has been remarkable." 
D) "The Green movement has sparked an increase in our sales of biodegradable products." 
E) "More firms are producing biodegradable products." 
A) "Since our competitors raised their prices,our sales have doubled." 
B) "It has been an unusually mild winter;our sales of wool scarves are down from last year." 
C) "We decided to cut our prices,and the increase in our sales has been remarkable." 
D) "The Green movement has sparked an increase in our sales of biodegradable products." 
E) "More firms are producing biodegradable products."

Question 15

Use the figure below to answer the following questions.   Figure 3.2.1
-Point A in Figure 3.2.1 indicates that

Accepted Answer

A) $1 is the least that consumers are willing to pay for the 4,000th apple. 
B) consumers will not be in equilibrium if the price of an apple is $1. 
C) consumers will only pay $1 for any apple. 
D) if the price is $1,consumers will plan to buy 4,000 apples. 
E) if the price is more than $1,consumers will buy 9,000 apples. 
A) $1 is the least that consumers are willing to pay for the 4,000th apple. 
B) consumers will not be in equilibrium if the price of an apple is $1. 
C) consumers will only pay $1 for any apple. 
D) if the price is $1,consumers will plan to buy 4,000 apples. 
E) if the price is more than $1,consumers will buy 9,000 apples.

Question 16

The price of good A rises,and the demand curve for good B shifts leftward.We can conclude that

Accepted Answer

A) A and B are substitutes. 
B) A and B are complements. 
C) A and B are complements in production. 
D) B is an inferior good. 
E) B is a normal good. 
A) A and B are substitutes. 
B) A and B are complements. 
C) A and B are complements in production. 
D) B is an inferior good. 
E) B is a normal good.

Question 17

Use the information below to answer the following questions.
Fact 3.5.1
The market for coffee is initially in equilibrium.Pepsi is a substitute for coffee;cream is a complement of coffee.Consider the market for coffee.Assume that all ceteris paribus assumptions continue to hold except for the event listed.
-Refer to Fact 3.5.1.If there is an increase in the wages of farm workers who harvest coffee beans,the equilibrium quantity of coffee

Accepted Answer

A) increases. 
B) decreases. 
C) remains the same. 
D) increases or decreases depending on the slope of the supply and demand curves. 
E) increases or decreases depending on the relative shifts of the supply and demand curves. 
A) increases. 
B) decreases. 
C) remains the same. 
D) increases or decreases depending on the slope of the supply and demand curves. 
E) increases or decreases depending on the relative shifts of the supply and demand curves.

Question 18

Use the figure below to answer the following questions.   Figure 3.4.2
-At a price of $10 a unit in Figure 3.4.2,

Accepted Answer

A) there is a surplus of 200 units. 
B) there is a shortage of 200 units. 
C) there is a surplus of 400 units. 
D) there is a shortage of 400 units. 
E) supply exceeds demand. 
A) there is a surplus of 200 units. 
B) there is a shortage of 200 units. 
C) there is a surplus of 400 units. 
D) there is a shortage of 400 units. 
E) supply exceeds demand.

Question 19

Use the figure below to answer the following questions.   Figure 3.5.1
-Initially,the demand curve for good A is D2 in Figure 3.5.1.If income increases and A is a normal good,we would expect to see a movement from point A to point

Accepted Answer

A) B. 
B) C. 
C) D. 
D) E. 
E) E or point D. 
A) B. 
B) C. 
C) D. 
D) E. 
E) E or point D.

Question 20

If the quantity of textbooks supplied is 10,000 per year and the quantity of textbooks demanded is 8,000 per year,there is a ________ in the market and the price will ________.

Accepted Answer

A) shortage;rise 
B) shortage;fall 
C) surplus;rise 
D) surplus;fall 
E) surplus;either rise or fall depending on whether supply increases to meet the surplus 
A) shortage;rise 
B) shortage;fall 
C) surplus;rise 
D) surplus;fall 
E) surplus;either rise or fall depending on whether supply increases to meet the surplus

If A and B are substitutes and the price of A rises,we will observe

The price at which sellers are not willing to supply a good is $700 per unit.If the supply curve passes through the point (3,718),what is the equation of the supply curve?

Use the figure below to answer the following questions. Figure 3.5.2 Original equilibrium at 1. -Refer to Figure 3.5.2,which represents the market for beans.If the price of peas,a substitute for beans and a substitute in production,rises,what is the new beans equilibrium,ceteris paribus?

"As domestic car prices have increased,consumers have found foreign cars to be a better bargain.Consequently,domestic car sales have fallen and foreign car sales have risen." Based on this information alone,there has been a

The fact that a fall in the price of a good results in a decrease in the quantity of the good supplied illustrates

Use the table below to answer the following questions. Table 3.5.1 The Market for Car-Seat Heaters -Refer to Table 3.5.1.Suppose the cost of production rises and supply decreases by 100 units at each price.The new equilibrium price is $ and equilibrium quantity is units.

Use the figure below to answer the following questions. Figure 3.5.1 -If the demand curve is D₂ in Figure 3.5.1,

The price of good X falls and the demand for good Y decreases.We can conclude that

The relative price of a good is

If demand increases and supply decreases,then the

The price of a good will rise if

Suppose the price of a football is $40.00 and the price of a basketball is $20.00.The of a football is .

Use the figure below to answer the following questions. Figure 3.4.1 -At price P₂ in Figure 3.4.1,which one of the following is not true?

Some sales managers are talking shop.Which one of the following quotations refers to a leftward shift of the demand curve?

Use the figure below to answer the following questions. Figure 3.2.1 -Point A in Figure 3.2.1 indicates that

The price of good A rises,and the demand curve for good B shifts leftward.We can conclude that

Use the figure below to answer the following questions. Figure 3.4.2 -At a price of $10 a unit in Figure 3.4.2,

Use the figure below to answer the following questions. Figure 3.5.1 -Initially,the demand curve for good A is D₂ in Figure 3.5.1.If income increases and A is a normal good,we would expect to see a movement from point A to point

If the quantity of textbooks supplied is 10,000 per year and the quantity of textbooks demanded is 8,000 per year,there is a in the market and the price will .

What Is Economics

The Economic Problem

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, preferences, and Choices

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Public Goods and Common Resources

Markets for Factors of Production

Economic Inequality

Filters

Exam 3: Demand and Supply

If A and B are substitutes and the price of A rises,we will observe

The price at which sellers are not willing to supply a good is $700 per unit.If the supply curve passes through the point (3,718),what is the equation of the supply curve?

Use the figure below to answer the following questions. Figure 3.5.2 Original equilibrium at 1. -Refer to Figure 3.5.2,which represents the market for beans.If the price of peas,a substitute for beans and a substitute in production,rises,what is the new beans equilibrium,ceteris paribus?

"As domestic car prices have increased,consumers have found foreign cars to be a better bargain.Consequently,domestic car sales have fallen and foreign car sales have risen." Based on this information alone,there has been a

The fact that a fall in the price of a good results in a decrease in the quantity of the good supplied illustrates

Use the table below to answer the following questions. Table 3.5.1 The Market for Car-Seat Heaters -Refer to Table 3.5.1.Suppose the cost of production rises and supply decreases by 100 units at each price.The new equilibrium price is $________ and equilibrium quantity is ________ units.

Use the figure below to answer the following questions. Figure 3.5.1 -If the demand curve is D2 in Figure 3.5.1,

The price of good X falls and the demand for good Y decreases.We can conclude that

The relative price of a good is

If demand increases and supply decreases,then the

The price of a good will rise if

Suppose the price of a football is $40.00 and the price of a basketball is $20.00.The ________ of a football is ________.

Use the figure below to answer the following questions. Figure 3.4.1 -At price P2 in Figure 3.4.1,which one of the following is not true?

Some sales managers are talking shop.Which one of the following quotations refers to a leftward shift of the demand curve?

Use the figure below to answer the following questions. Figure 3.2.1 -Point A in Figure 3.2.1 indicates that

The price of good A rises,and the demand curve for good B shifts leftward.We can conclude that

Use the figure below to answer the following questions. Figure 3.4.2 -At a price of $10 a unit in Figure 3.4.2,

Use the figure below to answer the following questions. Figure 3.5.1 -Initially,the demand curve for good A is D2 in Figure 3.5.1.If income increases and A is a normal good,we would expect to see a movement from point A to point

If the quantity of textbooks supplied is 10,000 per year and the quantity of textbooks demanded is 8,000 per year,there is a ________ in the market and the price will ________.

What Is Economics

The Economic Problem

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, preferences, and Choices

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Public Goods and Common Resources

Markets for Factors of Production

Economic Inequality

Filters

Use the table below to answer the following questions. Table 3.5.1 The Market for Car-Seat Heaters -Refer to Table 3.5.1.Suppose the cost of production rises and supply decreases by 100 units at each price.The new equilibrium price is $ and equilibrium quantity is units.

Use the figure below to answer the following questions. Figure 3.5.1 -If the demand curve is D₂ in Figure 3.5.1,

Suppose the price of a football is $40.00 and the price of a basketball is $20.00.The of a football is .

Use the figure below to answer the following questions. Figure 3.4.1 -At price P₂ in Figure 3.4.1,which one of the following is not true?

Use the figure below to answer the following questions. Figure 3.5.1 -Initially,the demand curve for good A is D₂ in Figure 3.5.1.If income increases and A is a normal good,we would expect to see a movement from point A to point

If the quantity of textbooks supplied is 10,000 per year and the quantity of textbooks demanded is 8,000 per year,there is a in the market and the price will .