Question 1

A surplus will cause pressure on the price to fall.

Accepted Answer

A) True 
 B)False

Question 2

An increase in the demand for gasoline today caused by concerns that gasoline prices will be higher tomorrow is most likely attributable to which demand shifter?

Accepted Answer

A)  income 
B)  consumer expectations 
C)  consumer preferences 
D)  prices of other goods 
A)  income 
B)  consumer expectations 
C)  consumer preferences 
D)  prices of other goods

Question 3

-(Exhibit: Shifts in Demand and Supply) Assume that the market in Panel (a) is in equilibrium at point M. Compared to the initial equilibrium at point N, what changes could explain what happened in this market?

Accepted Answer

A)  supply decreased 
B)  demand decreased 
C)  both demand and supply decreased 
D)  both demand and supply increased 
A)  supply decreased 
B)  demand decreased 
C)  both demand and supply decreased 
D)  both demand and supply increased

Question 4

Every day for the past two years you've had ham and cheese on a whole wheat bagel for lunch at Bungalow Bob's Bagel Boutique. However, the price of whole wheat bagels has risen by 10 cents so today you decide to have ham and cheese on a rye bagel. In this case, whole wheat and rye bagels are best considered:

Accepted Answer

A)  superior goods. 
B)  normal goods. 
C)  substitute goods. 
D)  complementary goods. 
A)  superior goods. 
B)  normal goods. 
C)  substitute goods. 
D)  complementary goods.

Question 5

-(Exhibit: Demand and Supply-Determinants) The exhibit shows how supply and demand might shift in response to specific events. Suppose consumer incomes decrease. Which panel best describes how this will affect the market for used clothing, an inferior good?

Accepted Answer

A)  Panel (a) 
B)  Panel (b) 
C)  Panel (c) 
D)  Panel (d) 
A)  Panel (a) 
B)  Panel (b) 
C)  Panel (c) 
D)  Panel (d)

Question 6

If a market reflects a shortage and prices are allowed to move:

Accepted Answer

A)  supply will increase. 
B)  demand will decrease. 
C)  price will decrease. 
D)  price will increase. 
A)  supply will increase. 
B)  demand will decrease. 
C)  price will decrease. 
D)  price will increase.

Question 7

-(Exhibit: Demand and Supply-Determinants) The exhibit shows how supply and demand might shift in response to specific events. Suppose scientists discover that eating pomegranates causes premature aging. Which panel best describes how this will affect the market for pomegranates?

Accepted Answer

A)  Panel (a) 
B)  Panel (b) 
C)  Panel (c) 
D)  Panel (d) 
A)  Panel (a) 
B)  Panel (b) 
C)  Panel (c) 
D)  Panel (d)

Question 8

The Demand for Chocolate-Covered Peanuts
Quantity Demanded
(bags per month)
  
-(Exhibit: The Demand for Chocolate-Covered Peanuts) If George is only able to purchase 30 bags of chocolate-covered peanuts, the maximum price he is willing and able to pay for each bag is ________ cents.

Accepted Answer

A)  80 
B)  70 
C)  60 
D)  50 
A)  80 
B)  70 
C)  60 
D)  50

Question 9

List and explain the supply shifters.

Accepted Answer

Supply shifters, also known as determina

Question 10

A decrease in the price of a factor of production will lead to an increase in the supply of goods that use the factor in production.

Accepted Answer

A) True 
 B)False

Question 11

Factor prices, returns from alternative activities, technology, number of firms, producer expectations, and natural events are often termed:

Accepted Answer

A)  demand determinants. 
B)  demand quantities. 
C)  supply prices. 
D)  supply shifters. 
A)  demand determinants. 
B)  demand quantities. 
C)  supply prices. 
D)  supply shifters.

Question 12

-(Exhibit: Demand and Supply Shifters) The exhibit shows how supply and demand might shift in response to specific events. Suppose the Surgeon General announces that eating chocolate prevents heart disease. Which panel best describes how this will affect the market for chocolate?

Accepted Answer

A)  Panel (a) 
B)  Panel (b) 
C)  Panel (c) 
D)  Panel (d) 
A)  Panel (a) 
B)  Panel (b) 
C)  Panel (c) 
D)  Panel (d)

Question 13

Given that chicken and beef are substitute goods, if the price of chicken decreases substantially, there would be:

Accepted Answer

A)  an increase in the demand for beef. 
B)  a decrease in the demand for beef. 
C)  a decrease in the quantity of beef demanded. 
D)  no change in the demand for beef. 
A)  an increase in the demand for beef. 
B)  a decrease in the demand for beef. 
C)  a decrease in the quantity of beef demanded. 
D)  no change in the demand for beef.

Question 14

Which of the following will result in an increased price of milk?

Accepted Answer

A)  A shift to the right of the supply curve for milk. 
B)  A shift to the right of the demand curve for milk. 
C)  An increase in the number of milk suppliers. 
D)  A decrease in the number of milk buyers. 
A)  A shift to the right of the supply curve for milk. 
B)  A shift to the right of the demand curve for milk. 
C)  An increase in the number of milk suppliers. 
D)  A decrease in the number of milk buyers.

Question 15

List and explain the demand shifters.

Accepted Answer

Demand shifters are factors that can cau

Question 16

-(Exhibit: Simultaneous Shifts in Demand and Supply) D1 and S1 are original supply and demand curves, and S2 and D2 are new curves. In this market, the original equilibrium changed from point ________ to point ________ .

Accepted Answer

A)  J; L 
B)  L; J 
C)  J; M 
D)  J; K 
A)  J; L 
B)  L; J 
C)  J; M 
D)  J; K

Question 17

An increase in price will result in a decrease in the quantity supplied.

Accepted Answer

A) True 
 B)False

Question 18

A market surplus occurs if the quantity:

Accepted Answer

A)  demanded is greater than the quantity supplied. 
B)  demanded is less than the quantity supplied. 
C)  demanded is equal to the quantity supplied. 
D)  supplied is less than the quantity demanded. 
A)  demanded is greater than the quantity supplied. 
B)  demanded is less than the quantity supplied. 
C)  demanded is equal to the quantity supplied. 
D)  supplied is less than the quantity demanded.

Question 19

An increase in supply, with no change in demand, will lead to ______ _ in equilibrium quantity and ________ in equilibrium price.

Accepted Answer

A)  an increase; an increase 
B)  an increase; a decrease 
C)  a decrease; an increase 
D)  a decrease; a decrease 
A)  an increase; an increase 
B)  an increase; a decrease 
C)  a decrease; an increase 
D)  a decrease; a decrease

Question 20

The theory underlying demand and supply curves assumes that, all other things unchanged, the primary variable that assures the equality of the quantities demanded and supplied is:

Accepted Answer

A)  consumer income. 
B)  the preferences of consumers. 
C)  the expectations of consumers and producers. 
D)  price. 
A)  consumer income. 
B)  the preferences of consumers. 
C)  the expectations of consumers and producers. 
D)  price.

A surplus will cause pressure on the price to fall.

An increase in the demand for gasoline today caused by concerns that gasoline prices will be higher tomorrow is most likely attributable to which demand shifter?

-(Exhibit: Shifts in Demand and Supply) Assume that the market in Panel (a) is in equilibrium at point M. Compared to the initial equilibrium at point N, what changes could explain what happened in this market?

-(Exhibit: Demand and Supply-Determinants) The exhibit shows how supply and demand might shift in response to specific events. Suppose consumer incomes decrease. Which panel best describes how this will affect the market for used clothing, an inferior good?

If a market reflects a shortage and prices are allowed to move:

-(Exhibit: Demand and Supply-Determinants) The exhibit shows how supply and demand might shift in response to specific events. Suppose scientists discover that eating pomegranates causes premature aging. Which panel best describes how this will affect the market for pomegranates?

The Demand for Chocolate-Covered Peanuts Quantity Demanded (bags per month) -(Exhibit: The Demand for Chocolate-Covered Peanuts) If George is only able to purchase 30 bags of chocolate-covered peanuts, the maximum price he is willing and able to pay for each bag is ________ cents.

List and explain the supply shifters.

A decrease in the price of a factor of production will lead to an increase in the supply of goods that use the factor in production.

Factor prices, returns from alternative activities, technology, number of firms, producer expectations, and natural events are often termed:

-(Exhibit: Demand and Supply Shifters) The exhibit shows how supply and demand might shift in response to specific events. Suppose the Surgeon General announces that eating chocolate prevents heart disease. Which panel best describes how this will affect the market for chocolate?

Given that chicken and beef are substitute goods, if the price of chicken decreases substantially, there would be:

Which of the following will result in an increased price of milk?

List and explain the demand shifters.

-(Exhibit: Simultaneous Shifts in Demand and Supply) D₁ and S₁ are original supply and demand curves, and S₂ and D₂ are new curves. In this market, the original equilibrium changed from point to point .

An increase in price will result in a decrease in the quantity supplied.

A market surplus occurs if the quantity:

An increase in supply, with no change in demand, will lead to ______ _ in equilibrium quantity and ________ in equilibrium price.

The theory underlying demand and supply curves assumes that, all other things unchanged, the primary variable that assures the equality of the quantities demanded and supplied is:

Economics: the Study of Choice

Applications of Demand and Supply

Macroeconomics: the Big Picture

Measuring Total Output and Income

Aggregate Demand and Aggregate Supply

Economic Growth

The Nature and Creation of Money

Financial Markets and the Economy

Monetary Policy and the Fed

Government and Fiscal Policy

Consumption and the Aggregate Expenditures Model

Investment and Economic Activity

Net Exports and International Finance

Inflation and Unemployment

A Brief History of Macroeconomic Thought and Policy

Inequality, Poverty, and Discrimination

Economic Development

Socialist Economies in Transition

Filters

Exam 3: Demand and Supply

A surplus will cause pressure on the price to fall.

An increase in the demand for gasoline today caused by concerns that gasoline prices will be higher tomorrow is most likely attributable to which demand shifter?

-(Exhibit: Shifts in Demand and Supply) Assume that the market in Panel (a) is in equilibrium at point M. Compared to the initial equilibrium at point N, what changes could explain what happened in this market?

-(Exhibit: Demand and Supply-Determinants) The exhibit shows how supply and demand might shift in response to specific events. Suppose consumer incomes decrease. Which panel best describes how this will affect the market for used clothing, an inferior good?

If a market reflects a shortage and prices are allowed to move:

-(Exhibit: Demand and Supply-Determinants) The exhibit shows how supply and demand might shift in response to specific events. Suppose scientists discover that eating pomegranates causes premature aging. Which panel best describes how this will affect the market for pomegranates?

The Demand for Chocolate-Covered Peanuts Quantity Demanded (bags per month) -(Exhibit: The Demand for Chocolate-Covered Peanuts) If George is only able to purchase 30 bags of chocolate-covered peanuts, the maximum price he is willing and able to pay for each bag is ________ cents.

List and explain the supply shifters.

A decrease in the price of a factor of production will lead to an increase in the supply of goods that use the factor in production.

Factor prices, returns from alternative activities, technology, number of firms, producer expectations, and natural events are often termed:

-(Exhibit: Demand and Supply Shifters) The exhibit shows how supply and demand might shift in response to specific events. Suppose the Surgeon General announces that eating chocolate prevents heart disease. Which panel best describes how this will affect the market for chocolate?

Given that chicken and beef are substitute goods, if the price of chicken decreases substantially, there would be:

Which of the following will result in an increased price of milk?

List and explain the demand shifters.

-(Exhibit: Simultaneous Shifts in Demand and Supply) D1 and S1 are original supply and demand curves, and S2 and D2 are new curves. In this market, the original equilibrium changed from point ________ to point ________ .

An increase in price will result in a decrease in the quantity supplied.

A market surplus occurs if the quantity:

An increase in supply, with no change in demand, will lead to ______ _ in equilibrium quantity and ________ in equilibrium price.

The theory underlying demand and supply curves assumes that, all other things unchanged, the primary variable that assures the equality of the quantities demanded and supplied is:

Economics: the Study of Choice

Applications of Demand and Supply

Macroeconomics: the Big Picture

Measuring Total Output and Income

Aggregate Demand and Aggregate Supply

Economic Growth

The Nature and Creation of Money

Financial Markets and the Economy

Monetary Policy and the Fed

Government and Fiscal Policy

Consumption and the Aggregate Expenditures Model

Investment and Economic Activity

Net Exports and International Finance

Inflation and Unemployment

A Brief History of Macroeconomic Thought and Policy

Inequality, Poverty, and Discrimination

Economic Development

Socialist Economies in Transition

Filters

-(Exhibit: Simultaneous Shifts in Demand and Supply) D₁ and S₁ are original supply and demand curves, and S₂ and D₂ are new curves. In this market, the original equilibrium changed from point to point .