Question 1

French fries and baked potatoes are

Accepted Answer

A) complements for consumers and substitutes in production for producers. 
B) substitutes for consumers and substitutes in production for producers. 
C) normal goods for consumers and complements for producers. 
D) complements for consumers and complements in production for producers. 
E) substitutes in production for consumers and inferior goods for producers. 
A) complements for consumers and substitutes in production for producers. 
B) substitutes for consumers and substitutes in production for producers. 
C) normal goods for consumers and complements for producers. 
D) complements for consumers and complements in production for producers. 
E) substitutes in production for consumers and inferior goods for producers.

Question 2

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

Question 3

If the market for Twinkies is in equilibrium, then

Accepted Answer

A) Twinkies must be a normal good. 
B) the equilibrium quantity equals the quantity demanded. 
C) producers would like to sell more at the current price. 
D) there is a surplus. 
E) consumers would like to buy more at the current price. 
A) Twinkies must be a normal good. 
B) the equilibrium quantity equals the quantity demanded. 
C) producers would like to sell more at the current price. 
D) there is a surplus. 
E) consumers would like to buy more at the current price.

Question 4

Use the table below to answer the following questions.
Table 3.1.1  
-Refer to Table 3.1.1.Between 2016 and 2017, the price of coffee relative to the price of tea _______ while the price of coffee relative to the price of cola _______

Accepted Answer

A) rose; rose 
B) fell; did not change 
C) rose; fell 
D) fell; rose 
E) fell; fell 
A) rose; rose 
B) fell; did not change 
C) rose; fell 
D) fell; rose 
E) fell; fell

Question 5

The law of demand applies to food because when the price of food rises, there is

Accepted Answer

A) a substitution effect and a complement effect. 
B) an income effect but no substitution effect. 
C) a substitution effect that offsets the income effect. 
D) a substitution effect but no income effect. 
E) both a substitution effect and an income effect. 
A) a substitution effect and a complement effect. 
B) an income effect but no substitution effect. 
C) a substitution effect that offsets the income effect. 
D) a substitution effect but no income effect. 
E) both a substitution effect and an income effect.

Question 6

-Refer to Table 3.4.2.The table shows the demand and supply schedules for shampoo.Choose the correct statement.

Accepted Answer

A) The equilibrium price is an unknown amount between $6 and $10 a bottle. 
B) There is no equilibrium in this market. 
C) The equilibrium quantity is 140 bottles a week. 
D) The equilibrium price is $8 a bottle. 
E) The equilibrium quantity is 100 bottles a week. 
A) The equilibrium price is an unknown amount between $6 and $10 a bottle. 
B) There is no equilibrium in this market. 
C) The equilibrium quantity is 140 bottles a week. 
D) The equilibrium price is $8 a bottle. 
E) The equilibrium quantity is 100 bottles a week.

Question 7

Which one of the following correctly describes how price adjustment eliminates a shortage?

Accepted Answer

A) As the price falls, the quantity demanded increases and the quantity supplied increases. 
B) As the price rises, the quantity demanded decreases and the quantity supplied increases. 
C) As the price rises, the quantity demanded increases and the quantity supplied decreases. 
D) As the price falls, the quantity demanded increases and the quantity supplied decreases. 
E) As the price falls, the quantity demanded decreases and the quantity supplied increases. 
A) As the price falls, the quantity demanded increases and the quantity supplied increases. 
B) As the price rises, the quantity demanded decreases and the quantity supplied increases. 
C) As the price rises, the quantity demanded increases and the quantity supplied decreases. 
D) As the price falls, the quantity demanded increases and the quantity supplied decreases. 
E) As the price falls, the quantity demanded decreases and the quantity supplied increases.

Question 8

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 rises, what is the new beans equilibrium, ceteris paribus?

Accepted Answer

A) 8 
B) 3 
C) 9 
D) 5 
E) 6 
A) 8 
B) 3 
C) 9 
D) 5 
E) 6

Question 9

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

Question 10

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 for coffee.Assume that all ceteris paribus assumptions continue to hold except for the event listed.
-Refer to Fact 3.5.1.A technological improvement lowers the cost of producing coffee.At the same time, preferences for coffee decrease.The equilibrium quantity of coffee

Accepted Answer

A) increases. 
B) decreases. 
C) remains the same. 
D) increases or decreases depending on whether the price of coffee falls or rises. 
E) increases, decreases, or remains the same depending on the relative shifts of the demand and supply curves. 
A) increases. 
B) decreases. 
C) remains the same. 
D) increases or decreases depending on whether the price of coffee falls or rises. 
E) increases, decreases, or remains the same depending on the relative shifts of the demand and supply curves.

Question 11

Suppose we observe a rise in the price of good A and an increase in the quantity of good A bought and sold.Whi one of the following is a likely explanation?

Accepted Answer

A) The supply of A increased. 
B) The demand for A decreased. 
C) The law of demand is violated. 
D) The supply of A decreased. 
E) The demand for A increased. 
A) The supply of A increased. 
B) The demand for A decreased. 
C) The law of demand is violated. 
D) The supply of A decreased. 
E) The demand for A increased.

Question 12

Some producers are chatting.Which one of the following quotations refers to a movement along the supply curve?

Accepted Answer

A) "Wage increases have forced us to raise our prices." 
B) "We anticipate a big increase in demand.Our product price should rise, so we are planning for an increase in output." 
C) "New competitors in the industry are causing prices to fall." 
D) "Raw material prices have sky- rocketed; we will have to pass the cost on to our customers." 
E) "Our new, sophisticated equipment will enable us to undercut our competitors." 
A) "Wage increases have forced us to raise our prices." 
B) "We anticipate a big increase in demand.Our product price should rise, so we are planning for an increase in output." 
C) "New competitors in the industry are causing prices to fall." 
D) "Raw material prices have sky- rocketed; we will have to pass the cost on to our customers." 
E) "Our new, sophisticated equipment will enable us to undercut our competitors."

Question 13

If the number of suppliers of good Y increases, then

Accepted Answer

A) a movement down along the supply curve of good Y will occur. 
B) a movement up along the supply curve of good Y will occur. 
C) the supply curve of good Y shifts leftward. 
D) the supply curve of good Y becomes steeper. 
E) the supply curve of good Y shifts rightward. 
A) a movement down along the supply curve of good Y will occur. 
B) a movement up along the supply curve of good Y will occur. 
C) the supply curve of good Y shifts leftward. 
D) the supply curve of good Y becomes steeper. 
E) the supply curve of good Y shifts rightward.

Question 14

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 tacos.A new scientific study reveals that tacos cause bad breath.Simultaneously, the cost of producing tacos increases.What is the new 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 15

Use the table below to answer the following questions.
Price dollars per unit)
Table 3.4.1
Quantity Demanded
   Quantity Supplied units)
-Refer to Table 3.4.1.If the price is $3, then the shortage is

Accepted Answer

A) 160 units. 
B) 600 units. 
C) zero units. 
D) 1,050 units. 
E) 180 units. 
A) 160 units. 
B) 600 units. 
C) zero units. 
D) 1,050 units. 
E) 180 units.

Question 16

A shift of the supply curve for rutabagas occurs if there is

Accepted Answer

A) a change in income. 
B) a change in the price of a related good that is a substitute for rutabagas. 
C) a change in preferences for rutabagas. 
D) a change in the price of rutabagas. 
E) a flood that destroys rutabaga farms. 
A) a change in income. 
B) a change in the price of a related good that is a substitute for rutabagas. 
C) a change in preferences for rutabagas. 
D) a change in the price of rutabagas. 
E) a flood that destroys rutabaga farms.

Question 17

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 in production, rises, what is the new beans equilibrium, ceteris paribus?

Accepted Answer

A) 8 
B) 3 
C) 9 
D) 5 
E) 6 
A) 8 
B) 3 
C) 9 
D) 5 
E) 6

Question 18

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

Question 19

If A and B are complements in production and the price of A falls, the supply of B

Accepted Answer

A) decreases, and the price of B falls. 
B) does not change. 
C) decreases, and the price of B rises. 
D) increases, and the price of B rises. 
E) increases, and the price of B falls. 
A) decreases, and the price of B falls. 
B) does not change. 
C) decreases, and the price of B rises. 
D) increases, and the price of B rises. 
E) increases, and the price of B falls.

Question 20

Use the table below to answer the following questions.
Price dollars per unit)
Table 3.4.1
Quantity Demanded
   Quantity Supplied units)
-In Table 3.4.1, the equilibrium price is

Accepted Answer

A) $7 a unit. 
B) $4 a unit. 
C) $3 a unit. 
D) $5 a unit. 
E) $1 a unit. 
A) $7 a unit. 
B) $4 a unit. 
C) $3 a unit. 
D) $5 a unit. 
E) $1 a unit.

French fries and baked potatoes are

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

If the market for Twinkies is in equilibrium, then

Use the table below to answer the following questions. Table 3.1.1 -Refer to Table 3.1.1.Between 2016 and 2017, the price of coffee relative to the price of tea _ while the price of coffee relative to the price of cola _

The law of demand applies to food because when the price of food rises, there is

-Refer to Table 3.4.2.The table shows the demand and supply schedules for shampoo.Choose the correct statement.

Which one of the following correctly describes how price adjustment eliminates a shortage?

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 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

Suppose we observe a rise in the price of good A and an increase in the quantity of good A bought and sold.Whi one of the following is a likely explanation?

Some producers are chatting.Which one of the following quotations refers to a movement along the supply curve?

If the number of suppliers of good Y increases, then

Use the table below to answer the following questions. Price dollars per unit) Table 3.4.1 Quantity Demanded Quantity Supplied units) -Refer to Table 3.4.1.If the price is $3, then the shortage is

A shift of the supply curve for rutabagas occurs if there is

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 in production, rises, what is the new beans equilibrium, ceteris paribus?

Use the figure below to answer the following questions. Figure 3.4.1 -At price P₂in Figure 3.4.1, which one of the following is not true?

If A and B are complements in production and the price of A falls, the supply of B

Use the table below to answer the following questions. Price dollars per unit) Table 3.4.1 Quantity Demanded Quantity Supplied units) -In Table 3.4.1, the equilibrium price is

What Is Economics

The Economic Problem

Measuring Gdp and Economic Growth

Monitoring Jobs and Inflation

Economic Growth

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers

The Business Cycle, Inflation, and Deflation

Fiscal Policy

Monetary Policy

International Trade Policy

Filters

Exam 3: Demand and Supply

French fries and baked potatoes are

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

If the market for Twinkies is in equilibrium, then

Use the table below to answer the following questions. Table 3.1.1 -Refer to Table 3.1.1.Between 2016 and 2017, the price of coffee relative to the price of tea _______ while the price of coffee relative to the price of cola _______

The law of demand applies to food because when the price of food rises, there is

-Refer to Table 3.4.2.The table shows the demand and supply schedules for shampoo.Choose the correct statement.

Which one of the following correctly describes how price adjustment eliminates a shortage?

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 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

Suppose we observe a rise in the price of good A and an increase in the quantity of good A bought and sold.Whi one of the following is a likely explanation?

Some producers are chatting.Which one of the following quotations refers to a movement along the supply curve?

If the number of suppliers of good Y increases, then

Use the table below to answer the following questions. Price dollars per unit) Table 3.4.1 Quantity Demanded Quantity Supplied units) -Refer to Table 3.4.1.If the price is $3, then the shortage is

A shift of the supply curve for rutabagas occurs if there is

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 in production, rises, what is the new beans equilibrium, ceteris paribus?

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?

If A and B are complements in production and the price of A falls, the supply of B

Use the table below to answer the following questions. Price dollars per unit) Table 3.4.1 Quantity Demanded Quantity Supplied units) -In Table 3.4.1, the equilibrium price is

What Is Economics

The Economic Problem

Measuring Gdp and Economic Growth

Monitoring Jobs and Inflation

Economic Growth

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers

The Business Cycle, Inflation, and Deflation

Fiscal Policy

Monetary Policy

International Trade Policy

Filters

Use the table below to answer the following questions. Table 3.1.1 -Refer to Table 3.1.1.Between 2016 and 2017, the price of coffee relative to the price of tea _ while the price of coffee relative to the price of cola _

Use the figure below to answer the following questions. Figure 3.4.1 -At price P₂in Figure 3.4.1, which one of the following is not true?