Question 1

The "law of demand" states that changes in

Accepted Answer

A)  demand are related directly to changes in supply. 
B)  the quantity demanded of a good are not related to changes in the quantity supplied. 
C)  the quantity demanded of a good are inversely related to changes in its price. 
D)  demand are inversely related to changes in supply. 
A)  demand are related directly to changes in supply. 
B)  the quantity demanded of a good are not related to changes in the quantity supplied. 
C)  the quantity demanded of a good are inversely related to changes in its price. 
D)  demand are inversely related to changes in supply.

Question 2

-In the figure above, an increase in the quantity of oil supplied but NOT an increase in the supply of oil is shown by a movement from

Accepted Answer

A)  point a to point e. 
B)  point a to point b. 
C)  point a to point c. 
D)  point a to point d. 
A)  point a to point e. 
B)  point a to point b. 
C)  point a to point c. 
D)  point a to point d.

Question 3

-The equilibrium price in the above figure is

Accepted Answer

A)  $2. 
B)  $4. 
C)  $6. 
D)  $8. 
A)  $2. 
B)  $4. 
C)  $6. 
D)  $8.

Question 4

Which of the following increases the supply of a product?

Accepted Answer

A)  a fall in the price of the product 
B)  a smaller number of sellers producing the product 
C)  an increase in foreign imports of the product 
D)  higher taxes imposed upon producers of the product 
A)  a fall in the price of the product 
B)  a smaller number of sellers producing the product 
C)  an increase in foreign imports of the product 
D)  higher taxes imposed upon producers of the product

Question 5

-Using the above figure, suppose there is a decrease in the number of suppliers. Then

Accepted Answer

A)  the equilibrium price will decrease below $25 per dozen roses. 
B)  we cannot predict what will happen to equilibrium quantity. 
C)  the equilibrium quantity will decrease below 10 dozen roses. 
D)  both the equilibrium price and quantity will increase. 
A)  the equilibrium price will decrease below $25 per dozen roses. 
B)  we cannot predict what will happen to equilibrium quantity. 
C)  the equilibrium quantity will decrease below 10 dozen roses. 
D)  both the equilibrium price and quantity will increase.

Question 6

Which of the following is NOT one of the factors that influences the supply of a product?

Accepted Answer

A)  technology 
B)  income 
C)  number of suppliers 
D)  expected future prices 
A)  technology 
B)  income 
C)  number of suppliers 
D)  expected future prices

Question 7

A fall in the price of a good causes producers to reduce the quantity of the good they are willing to produce. This fact 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. 
A)  the law of supply. 
B)  the law of demand. 
C)  a change in supply. 
D)  the nature of an inferior good.

Question 8

-The above figure shows the market for hamburger. Which panel shows the effect of a drought in "cattle country"?

Accepted Answer

A)  Figure A 
B)  Figure B 
C)  Figure C 
D)  Figure D 
A)  Figure A 
B)  Figure B 
C)  Figure C 
D)  Figure D

Question 9

-In the above figure, if the demand curve is D2, then

Accepted Answer

A)  the equilibrium price will be P1 and the equilibrium quantity will be Q2. 
B)  the equilibrium price will be P1 and the equilibrium quantity will be Q1. 
C)  there will be a shortage equal to Q2 - Q1. 
D)  an increase in price will shift the demand curve to D3. 
A)  the equilibrium price will be P1 and the equilibrium quantity will be Q2. 
B)  the equilibrium price will be P1 and the equilibrium quantity will be Q1. 
C)  there will be a shortage equal to Q2 - Q1. 
D)  an increase in price will shift the demand curve to D3.

Question 10

The "law of supply" refers to the fact that, all other things remaining the same, when the price of a good rises,

Accepted Answer

A)  the supply curve shifts leftward. 
B)  the supply curve shifts rightward. 
C)  there is a movement up along the supply curve to a larger quantity supplied. 
D)  there is a movement down along the supply curve to a smaller quantity supplied. 
A)  the supply curve shifts leftward. 
B)  the supply curve shifts rightward. 
C)  there is a movement up along the supply curve to a larger quantity supplied. 
D)  there is a movement down along the supply curve to a smaller quantity supplied.

Question 11

For "an increase in the quantity demanded" but not "an increase in demand" to occur, there must be a

Accepted Answer

A)  rightward shift of the demand curve. 
B)  movement along the demand curve. 
C)  rightward shift of the demand curve and a movement along the demand curve. 
D)  Both answers B and C are correct. 
A)  rightward shift of the demand curve. 
B)  movement along the demand curve. 
C)  rightward shift of the demand curve and a movement along the demand curve. 
D)  Both answers B and C are correct.

Question 12

-The above figure shows the market for pizza. Which figure shows the effect of a new report by the U.S. Surgeon General that eating pizza lowers cholesterol levels, an outcome many people want?

Accepted Answer

A)  Figure A 
B)  Figure B. 
C)  Figure C 
D)  Figure D 
A)  Figure A 
B)  Figure B. 
C)  Figure C 
D)  Figure D

Question 13

The law of demand concludes that a rise in the price of a golf ball ________ the quantity demanded and ________.

Accepted Answer

A)  increases; shifts the demand curve for golf balls rightward. 
B)  decreases; shifts the demand curve for golf balls leftward. 
C)  decreases; creates a movement up along the demand curve for golf balls. 
D)  increases; creates a movement down along the demand curve for golf balls. 
A)  increases; shifts the demand curve for golf balls rightward. 
B)  decreases; shifts the demand curve for golf balls leftward. 
C)  decreases; creates a movement up along the demand curve for golf balls. 
D)  increases; creates a movement down along the demand curve for golf balls.

Question 14

-In the above figure, if D2 is the original demand curve and consumers come to expect that the price of the good will rise in the future, which price and quantity might result?

Accepted Answer

A)  point a, with price P2 and quantity Q2 
B)  point b, with price P1 and quantity Q1 
C)  point c, with price P3 and quantity Q3 
D)  point d, with price P1 and quantity Q3 
A)  point a, with price P2 and quantity Q2 
B)  point b, with price P1 and quantity Q1 
C)  point c, with price P3 and quantity Q3 
D)  point d, with price P1 and quantity Q3

Question 15

An increase in the number of consumers

Accepted Answer

A)  results only in a movement along the demand curve. 
B)  shifts the supply curve leftward 
C)  shifts the demand curve rightward. 
D)  Both answers B and C are correct. 
A)  results only in a movement along the demand curve. 
B)  shifts the supply curve leftward 
C)  shifts the demand curve rightward. 
D)  Both answers B and C are correct.

Question 16

If the equilibrium relative price for a two-liter bottle of Coca-Cola is $1.50 today, just like it was ten years ago, can we safely say that all supply and demand conditions in the market for Coke have remained very stable all these years?

Accepted Answer

Not necessarily. The demand curve might

Question 17

If house purchases and renting an apartment are substitutes, then an increase in the price of a new house results in a rise in the rent charged for apartments.

Accepted Answer

A) True 
 B)False

Question 18

When does a surplus occur?

Accepted Answer

A surplus occurs when the pric

Question 19

Over the past decade technological improvements that have lowered the cost of producing an automobile have increased

Accepted Answer

A)  both the supply and the demand for automobiles. 
B)  the supply but not the demand for automobiles. 
C)  the demand but not the supply of automobiles. 
D)  neither the supply nor the demand for automobiles. 
A)  both the supply and the demand for automobiles. 
B)  the supply but not the demand for automobiles. 
C)  the demand but not the supply of automobiles. 
D)  neither the supply nor the demand for automobiles.

Question 20

Changes in which of the following shifts the supply curve of hamburgers?

Accepted Answer

A)  a rise in the price of soda, a complement for hamburgers 
B)  new research that establishes a link between hamburgers and heart problems 
C)  an increase in the price of meat used to produce hamburgers 
D)  an economy-wide decrease in income because of a long recession 
A)  a rise in the price of soda, a complement for hamburgers 
B)  new research that establishes a link between hamburgers and heart problems 
C)  an increase in the price of meat used to produce hamburgers 
D)  an economy-wide decrease in income because of a long recession

Exam 3: Demand and Supply

The "law of demand" states that changes in

-In the figure above, an increase in the quantity of oil supplied but NOT an increase in the supply of oil is shown by a movement from

-The equilibrium price in the above figure is

Which of the following increases the supply of a product?

-Using the above figure, suppose there is a decrease in the number of suppliers. Then

Which of the following is NOT one of the factors that influences the supply of a product?

A fall in the price of a good causes producers to reduce the quantity of the good they are willing to produce. This fact illustrates

-The above figure shows the market for hamburger. Which panel shows the effect of a drought in "cattle country"?

-In the above figure, if the demand curve is D2, then

The "law of supply" refers to the fact that, all other things remaining the same, when the price of a good rises,

For "an increase in the quantity demanded" but not "an increase in demand" to occur, there must be a

-The above figure shows the market for pizza. Which figure shows the effect of a new report by the U.S. Surgeon General that eating pizza lowers cholesterol levels, an outcome many people want?

The law of demand concludes that a rise in the price of a golf ball ________ the quantity demanded and ________.

-In the above figure, if D2 is the original demand curve and consumers come to expect that the price of the good will rise in the future, which price and quantity might result?

An increase in the number of consumers

If the equilibrium relative price for a two-liter bottle of Coca-Cola is $1.50 today, just like it was ten years ago, can we safely say that all supply and demand conditions in the market for Coke have remained very stable all these years?

If house purchases and renting an apartment are substitutes, then an increase in the price of a new house results in a rise in the rent charged for apartments.

When does a surplus occur?

Over the past decade technological improvements that have lowered the cost of producing an automobile have increased

Changes in which of the following shifts the supply curve of hamburgers?

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

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Public Choices and Public Goods

Externalities and the Environment

Markets for Factors of Production

Economic Inequality

Uncertainty and Information

Extension A: Review

Extension B: Review

Extension C: Review

Extension D: Review

Extension E: Review

Extension F: Review

Filters

-In the above figure, if the demand curve is D₂, then

The law of demand concludes that a rise in the price of a golf ball the quantity demanded and .

-In the above figure, if D₂ is the original demand curve and consumers come to expect that the price of the good will rise in the future, which price and quantity might result?