Question 1

It is true that the equilibrium quantity will always go up if supply:

Accepted Answer

A)  and demand both increase. 
B)  increases and demand decreases. 
C)  and demand both decrease. 
D)  decreases and demand remains unchanged. 
A)  and demand both increase. 
B)  increases and demand decreases. 
C)  and demand both decrease. 
D)  decreases and demand remains unchanged.

Question 2

Assuming that pizza is a normal good, if students' income at your college increases substantially, there would be:

Accepted Answer

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

Question 3

Which statement best illustrates complementary goods?

Accepted Answer

A)  The price of tennis rackets declines so your economics instructor decides to take tennis lessons and purchases several cans of new tennis balls. 
B)  The price of Apple Macintosh computers declines so your economics instructor sells his or her IBM personal computer and buys a Macintosh. 
C)  After receiving a promotion and a hefty year-end bonus from the college, your economics instructor decides to stop buying denim jeans and switches to clothing befitting his or her loftier position on the faculty. 
D)  Fearing that the price of pipe tobacco will rise next year, your economics professor goes to his local tobacconist and purchases an ample supply to last for several years. 
A)  The price of tennis rackets declines so your economics instructor decides to take tennis lessons and purchases several cans of new tennis balls. 
B)  The price of Apple Macintosh computers declines so your economics instructor sells his or her IBM personal computer and buys a Macintosh. 
C)  After receiving a promotion and a hefty year-end bonus from the college, your economics instructor decides to stop buying denim jeans and switches to clothing befitting his or her loftier position on the faculty. 
D)  Fearing that the price of pipe tobacco will rise next year, your economics professor goes to his local tobacconist and purchases an ample supply to last for several years.

Question 4

Use the following to answer questions 
Exhibit: The Demand for Chocolate-Covered Peanuts
Quantity Demanded
(bags per month)
  
-(Exhibit: The Demand for Chocolate-Covered Peanuts) If George, Barbara, and Dan are the only three buyers in the market, and the price of a bag of chocolate-covered peanuts is 80 cents, the total market demand is ________ bags per month.

Accepted Answer

A)  70 
B)  80 
C)  105 
D)  280 
A)  70 
B)  80 
C)  105 
D)  280

Question 5

Use the following to answer questions .
Exhibit: Demand and Supply-Determinants  
-(Exhibit: Demand and Supply-Determinants) The exhibit shows how supply and demand might shift in response to specific events. Suppose the birth rate (the number of babies per female in the childbearing age bracket) decreases. Which panel best describes how this will affect the market for diapers?

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

Use the following to answer questions.
Exhibit: The Market for Chocolate-Covered Peanuts
  
-(Exhibit: The Market for Chocolate-Covered Peanuts) If the price of chocolate-covered peanuts is 80 cents, there is:

Accepted Answer

A)  a surplus of 140 bags per month. 
B)  a shortage of 140 bags per month. 
C)  a surplus of 70 bags per month. 
D)  a shortage of 70 bags per month. 
A)  a surplus of 140 bags per month. 
B)  a shortage of 140 bags per month. 
C)  a surplus of 70 bags per month. 
D)  a shortage of 70 bags per month.

Question 7

An increase in price will result in an increase in supply.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following would shift the demand curve for new textbooks to the right?

Accepted Answer

A)  A decrease in the price of paper. 
B)  A fall in the price of used textbooks. 
C)  An increase in college enrollments. 
D)  A fall in the price of new textbooks. 
A)  A decrease in the price of paper. 
B)  A fall in the price of used textbooks. 
C)  An increase in college enrollments. 
D)  A fall in the price of new textbooks.

Question 9

Use the following to answer questions .
Exhibit: Demand Shifters and Supply Shifters  
-(Exhibit: Demand Shifters and Supply Shifters) The exhibit shows how supply and demand might shift in response to specific events. Suppose consumer incomes increase. Which panel best describes how this will affect the market for tuxedoes, a normal 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 10

The relationship between the price of a good and the quantity people are willing and able to purchase is:

Accepted Answer

A)  supply. 
B)  demand. 
C)  equilibrium. 
D)  disequilibrium. 
A)  supply. 
B)  demand. 
C)  equilibrium. 
D)  disequilibrium.

Question 11

Demand is defined as:

Accepted Answer

A)  an amount that is purchased at a specific price, given supply. 
B)  a schedule that establishes the price of a good. 
C)  a schedule that shows how much will be purchased at various prices during a particular period, all other things unchanged. 
D)  the amount that will be bought at a specific price. 
A)  an amount that is purchased at a specific price, given supply. 
B)  a schedule that establishes the price of a good. 
C)  a schedule that shows how much will be purchased at various prices during a particular period, all other things unchanged. 
D)  the amount that will be bought at a specific price.

Question 12

Use the following to answer questions .
Exhibit: Demand and Supply Curves  
-(Exhibit: Demand and Supply Curves) The lowest price per unit that sellers would be willing to accept for 50 units is:

Accepted Answer

A)  $25. 
B)  $15. 
C)  $10. 
D)  $5. 
A)  $25. 
B)  $15. 
C)  $10. 
D)  $5.

Question 13

An increase in consumer income will lead to an increase in supply.

Accepted Answer

A) True 
 B)False

Question 14

Use the following to answer questions.
Exhibit: The Market for Chocolate-Covered Peanuts
  
-(Exhibit: The Market for Chocolate-Covered Peanuts) If the price of chocolate-covered peanuts is 60 cents, the price will:

Accepted Answer

A)  remain unchanged. 
B)  fall to 30 cents. 
C)  fall to 50 cents. 
D)  rise to 70 cents. 
A)  remain unchanged. 
B)  fall to 30 cents. 
C)  fall to 50 cents. 
D)  rise to 70 cents.

Question 15

Demand is best defined as the:

Accepted Answer

A)  amount of a commodity that buyers would be willing and able to purchase at a specific price. 
B)  price that buyers would be willing and able to pay for a specific quantity of a good. 
C)  relationship between the price of a good and the quantity people are able to purchase, all other things unchanged. 
D)  relationship between the price of a good and the quantity people are willing and able to purchase, all other things unchanged. 
A)  amount of a commodity that buyers would be willing and able to purchase at a specific price. 
B)  price that buyers would be willing and able to pay for a specific quantity of a good. 
C)  relationship between the price of a good and the quantity people are able to purchase, all other things unchanged. 
D)  relationship between the price of a good and the quantity people are willing and able to purchase, all other things unchanged.

Question 16

The price of apples falls. What happens in the market for apple pies?

Accepted Answer

A)  The equilibrium price falls, and the equilibrium quantity rises. 
B)  The equilibrium price rises, and the equilibrium quantity falls. 
C)  The equilibrium price and quantity rise. 
D)  The equilibrium price and quantity fall. 
A)  The equilibrium price falls, and the equilibrium quantity rises. 
B)  The equilibrium price rises, and the equilibrium quantity falls. 
C)  The equilibrium price and quantity rise. 
D)  The equilibrium price and quantity fall.

Question 17

Use the following to answer questions .
Exhibit: Demand and Supply of Gasoline  
-(Exhibit: Demand and Supply of Gasoline) Given the initial equilibrium of S1 and D, any price lower than _____________ will create pressure for the price to ________ .

Accepted Answer

A)  $2.00; fall 
B)  $2.50; rise 
C)  $3.00; rise 
D)  none of the above are true 
A)  $2.00; fall 
B)  $2.50; rise 
C)  $3.00; rise 
D)  none of the above are true

Question 18

Assume a market initially exhibits a shortage. Assuming that both prices and quantities are flexible, which of the following will be true after the market adjusts to equilibrium?

Accepted Answer

A)  Price is lower. 
B)  Quantity demanded is greater. 
C)  Quantity supplied is more. 
D)  Quantity supplied will be reduced. 
A)  Price is lower. 
B)  Quantity demanded is greater. 
C)  Quantity supplied is more. 
D)  Quantity supplied will be reduced.

Question 19

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 20

A market shortage 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 greater 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 greater than the quantity demanded.

It is true that the equilibrium quantity will always go up if supply:

Assuming that pizza is a normal good, if students' income at your college increases substantially, there would be:

Which statement best illustrates complementary goods?

Use the following to answer questions. Exhibit: The Market for Chocolate-Covered Peanuts -(Exhibit: The Market for Chocolate-Covered Peanuts) If the price of chocolate-covered peanuts is 80 cents, there is:

An increase in price will result in an increase in supply.

Which of the following would shift the demand curve for new textbooks to the right?

The relationship between the price of a good and the quantity people are willing and able to purchase is:

Demand is defined as:

Use the following to answer questions . Exhibit: Demand and Supply Curves -(Exhibit: Demand and Supply Curves) The lowest price per unit that sellers would be willing to accept for 50 units is:

An increase in consumer income will lead to an increase in supply.

Use the following to answer questions. Exhibit: The Market for Chocolate-Covered Peanuts -(Exhibit: The Market for Chocolate-Covered Peanuts) If the price of chocolate-covered peanuts is 60 cents, the price will:

Demand is best defined as the:

The price of apples falls. What happens in the market for apple pies?

Use the following to answer questions . Exhibit: Demand and Supply of Gasoline -(Exhibit: Demand and Supply of Gasoline) Given the initial equilibrium of S₁ and D, any price lower than _____ will create pressure for the price to .

Assume a market initially exhibits a shortage. Assuming that both prices and quantities are flexible, which of the following will be true after the market adjusts to equilibrium?

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

A market shortage occurs if the quantity:

Economics: the Study of Choice

Applications of Supply and Demand

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

Filters

Exam 3: Demand and Supply

It is true that the equilibrium quantity will always go up if supply:

Assuming that pizza is a normal good, if students' income at your college increases substantially, there would be:

Which statement best illustrates complementary goods?

Use the following to answer questions. Exhibit: The Market for Chocolate-Covered Peanuts -(Exhibit: The Market for Chocolate-Covered Peanuts) If the price of chocolate-covered peanuts is 80 cents, there is:

An increase in price will result in an increase in supply.

Which of the following would shift the demand curve for new textbooks to the right?

The relationship between the price of a good and the quantity people are willing and able to purchase is:

Demand is defined as:

Use the following to answer questions . Exhibit: Demand and Supply Curves -(Exhibit: Demand and Supply Curves) The lowest price per unit that sellers would be willing to accept for 50 units is:

An increase in consumer income will lead to an increase in supply.

Use the following to answer questions. Exhibit: The Market for Chocolate-Covered Peanuts -(Exhibit: The Market for Chocolate-Covered Peanuts) If the price of chocolate-covered peanuts is 60 cents, the price will:

Demand is best defined as the:

The price of apples falls. What happens in the market for apple pies?

Use the following to answer questions . Exhibit: Demand and Supply of Gasoline -(Exhibit: Demand and Supply of Gasoline) Given the initial equilibrium of S1 and D, any price lower than _____________ will create pressure for the price to ________ .

Assume a market initially exhibits a shortage. Assuming that both prices and quantities are flexible, which of the following will be true after the market adjusts to equilibrium?

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

A market shortage occurs if the quantity:

Economics: the Study of Choice

Applications of Supply and Demand

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

Filters

Use the following to answer questions . Exhibit: Demand and Supply of Gasoline -(Exhibit: Demand and Supply of Gasoline) Given the initial equilibrium of S₁ and D, any price lower than _____ will create pressure for the price to .