Question 1

Which influence does NOT shift the supply curve?

Accepted Answer

A)  people deciding that they want to buy more of the product 
B)  a decrease in the price firms expect to receive in the future 
C)  a rise in the wages paid to workers 
D)  the development of a new production technology 
A)  people deciding that they want to buy more of the product 
B)  a decrease in the price firms expect to receive in the future 
C)  a rise in the wages paid to workers 
D)  the development of a new production technology

Question 2

Consider the market for iPads. What happens if a fantastic new alternative tablet is developed by Samsung and, at the same time, a boat carrying a large shipment of iPads is attacked by pirates and sunk?

Accepted Answer

A)  Price decreases and quantity increases. 
B)  Price increases and quantity increases. 
C)  The change in price is indeterminate and quantity decreases. 
D)  Price increases and the change in quantity is indeterminate. 
A)  Price decreases and quantity increases. 
B)  Price increases and quantity increases. 
C)  The change in price is indeterminate and quantity decreases. 
D)  Price increases and the change in quantity is indeterminate.

Question 3

For consumers, pizza and hamburgers are substitutes. A rise in the price of a pizza causes a _____ in the equilibrium price of a hamburger and a(n) _____ in the equilibrium quantity of hamburgers.

Accepted Answer

A)  rise; increase 
B)  rise; decrease 
C)  fall; increase 
D)  fall; decrease 
A)  rise; increase 
B)  rise; decrease 
C)  fall; increase 
D)  fall; decrease

Question 4

Which factor would cause an INCREASE in the supply of a good?

Accepted Answer

A)  input prices rising 
B)  a fall in the price of the good 
C)  an increase in the number of sellers 
D)  expectations of future price increases 
A)  input prices rising 
B)  a fall in the price of the good 
C)  an increase in the number of sellers 
D)  expectations of future price increases

Question 5

If the price of mozzarella cheese (an ingredient in pizza) declines, there will be:

Accepted Answer

A)  a decrease in the supply of pizza. 
B)  an increase in the supply of pizza. 
C)  a decrease in the quantity of pizza supplied. 
D)  no change in the supply of pizza. 
A)  a decrease in the supply of pizza. 
B)  an increase in the supply of pizza. 
C)  a decrease in the quantity of pizza supplied. 
D)  no change in the supply of pizza.

Question 6

The _____ apples will decrease when apple prices rise.

Accepted Answer

A)  demand for 
B)  quantity demanded of 
C)  supply of 
D)  equilibrium of 
A)  demand for 
B)  quantity demanded of 
C)  supply of 
D)  equilibrium of

Question 7

Use the following to answer questions:  
-(Figure: Shifts in Demand and Supply III) Use Figure: Shifts in Demand and Supply III. The figure shows how supply and demand might shift in response to specific events. Suppose a wet and sunny year increases the nation's corn crop by 20%. Which panel BEST describes how this will affect the market for corn?

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

For most goods, purchases tend to rise with increases in buyers' incomes and to fall with decreases in buyers' incomes. Such goods are known as:

Accepted Answer

A)  inferior. 
B)  direct. 
C)  normal. 
D)  indirect. 
A)  inferior. 
B)  direct. 
C)  normal. 
D)  indirect.

Question 9

Which statement illustrates the law of demand?

Accepted Answer

A)  An increase in tuition encourages more students to enroll in college because the quality of education has risen. 
B)  Consumers buy more personal computers because prices have fallen. 
C)  Oil companies drill for new sources because prices are higher. 
D)  Fewer people play golf because incomes are lower. 
A)  An increase in tuition encourages more students to enroll in college because the quality of education has risen. 
B)  Consumers buy more personal computers because prices have fallen. 
C)  Oil companies drill for new sources because prices are higher. 
D)  Fewer people play golf because incomes are lower.

Question 10

You notice that the price of Blu-ray players falls and the quantity of Blu-ray players sold increases. You suspect that _____ Blu-ray players shifts to the _____.

Accepted Answer

A)  demand for; right. 
B)  demand for; left. 
C)  supply of; right. 
D)  supply of; left. 
A)  demand for; right. 
B)  demand for; left. 
C)  supply of; right. 
D)  supply of; left.

Question 11

Use the following to answer questions:  
-(Figure: Supply, Demand, and Equilibrium) Use Figure: Supply, Demand, and Equilibrium. In the figure, there will be excess demand for the good at a price of P3.

Accepted Answer

A) True 
 B)False

Question 12

If there is an excess supply of a good, the problem of scarcity does not apply to that good.

Accepted Answer

A) True 
 B)False

Question 13

Suppose that more police and security workers become aware that wearing bulletproof vests can protect them from injury and decide to start wearing bulletproof vests. At the same time, the price of ceramics used to produce the vests falls. The equilibrium price of bulletproof vests _____ and the equilibrium quantity produced _____.

Accepted Answer

A)  increases; increases 
B)  decreases; decreases 
C)  probably changes, but in an ambiguous direction; probably changes, but in an ambiguous direction 
D)  probably changes, but in an ambiguous direction; increases 
A)  increases; increases 
B)  decreases; decreases 
C)  probably changes, but in an ambiguous direction; probably changes, but in an ambiguous direction 
D)  probably changes, but in an ambiguous direction; increases

Question 14

Use the following to answer questions:  
-(Figure: The Demand and Supply of Wheat) Use Figure: The Demand and Supply of Wheat. What is the equilibrium quantity in this wheat market each period?

Accepted Answer

A)  12,000 bushels 
B)  2,000 bushels 
C)  10,000 bushels 
D)  6,000 bushels 
A)  12,000 bushels 
B)  2,000 bushels 
C)  10,000 bushels 
D)  6,000 bushels

Question 15

If supply is upward sloping, a shift of a demand curve to the right, all other things unchanged, will:

Accepted Answer

A)  increase equilibrium price and quantity. 
B)  decrease equilibrium price and quantity. 
C)  decrease equilibrium quantity and increase equilibrium price. 
D)  increase equilibrium quantity and decrease equilibrium price. 
A)  increase equilibrium price and quantity. 
B)  decrease equilibrium price and quantity. 
C)  decrease equilibrium quantity and increase equilibrium price. 
D)  increase equilibrium quantity and decrease equilibrium price.

Question 16

If tortilla chips are a normal good, when there is an increase in income, equilibrium price _____ and equilibrium quantity _____.

Accepted Answer

A)  decreases; increases. 
B)  decreases; decreases. 
C)  increases; increases. 
D)  increases; decreases. 
A)  decreases; increases. 
B)  decreases; decreases. 
C)  increases; increases. 
D)  increases; decreases.

Question 17

It is certain that the equilibrium price will fall when:

Accepted Answer

A)  the supply curve and the demand curve both shift to the right. 
B)  the supply curve shifts to the right and the demand curve shifts to the left. 
C)  supply and demand both increase. 
D)  supply decreases and demand stays the same. 
A)  the supply curve and the demand curve both shift to the right. 
B)  the supply curve shifts to the right and the demand curve shifts to the left. 
C)  supply and demand both increase. 
D)  supply decreases and demand stays the same.

Question 18

Which factor would cause a LEFTWARD shift in the supply curve for a good?:

Accepted Answer

A)  an increase in the number of sellers 
B)  a technological improvement in production 
C)  an increase in the cost of an input 
D)  an increase in the number of buyers 
A)  an increase in the number of sellers 
B)  a technological improvement in production 
C)  an increase in the cost of an input 
D)  an increase in the number of buyers

Question 19

Use the following to answer questions:  
-(Figure: Demand and Supply of Gasoline) Use Figure: Demand and Supply of Gasoline. What might cause the supply curve to shift from S2 back to the initial supply curve S1?

Accepted Answer

A)  The Organization of Petroleum Exporting Countries (OPE
C)  restricts the production of crude oil. 
B)  OPEC increases the production of crude oil. 
C)  U.S. citizens want to buy more gas. 
D)  Technology in the refinement of gasoline greatly improves. 
A)  The Organization of Petroleum Exporting Countries (OPE
C)  restricts the production of crude oil. 
B)  OPEC increases the production of crude oil. 
C)  U.S. citizens want to buy more gas. 
D)  Technology in the refinement of gasoline greatly improves.

Question 20

A decrease in demand and a decrease in supply will lead to a(n) _____ in equilibrium quantity and a(n) _____ in equilibrium price.

Accepted Answer

A)  decrease; indeterminate change 
B)  indeterminate change; increase 
C)  indeterminate change; decrease 
D)  increase; indeterminate change 
A)  decrease; indeterminate change 
B)  indeterminate change; increase 
C)  indeterminate change; decrease 
D)  increase; indeterminate change

Which influence does NOT shift the supply curve?

Consider the market for iPads. What happens if a fantastic new alternative tablet is developed by Samsung and, at the same time, a boat carrying a large shipment of iPads is attacked by pirates and sunk?

For consumers, pizza and hamburgers are substitutes. A rise in the price of a pizza causes a _ in the equilibrium price of a hamburger and a(n) _ in the equilibrium quantity of hamburgers.

Which factor would cause an INCREASE in the supply of a good?

If the price of mozzarella cheese (an ingredient in pizza) declines, there will be:

The _____ apples will decrease when apple prices rise.

For most goods, purchases tend to rise with increases in buyers' incomes and to fall with decreases in buyers' incomes. Such goods are known as:

Which statement illustrates the law of demand?

You notice that the price of Blu-ray players falls and the quantity of Blu-ray players sold increases. You suspect that _ Blu-ray players shifts to the _.

Use the following to answer questions: -(Figure: Supply, Demand, and Equilibrium) Use Figure: Supply, Demand, and Equilibrium. In the figure, there will be excess demand for the good at a price of P₃.

If there is an excess supply of a good, the problem of scarcity does not apply to that good.

Use the following to answer questions: -(Figure: The Demand and Supply of Wheat) Use Figure: The Demand and Supply of Wheat. What is the equilibrium quantity in this wheat market each period?

If supply is upward sloping, a shift of a demand curve to the right, all other things unchanged, will:

If tortilla chips are a normal good, when there is an increase in income, equilibrium price _ and equilibrium quantity _.

It is certain that the equilibrium price will fall when:

Which factor would cause a LEFTWARD shift in the supply curve for a good?:

Use the following to answer questions: -(Figure: Demand and Supply of Gasoline) Use Figure: Demand and Supply of Gasoline. What might cause the supply curve to shift from S₂ back to the initial supply curve S₁?

A decrease in demand and a decrease in supply will lead to a(n) _ in equilibrium quantity and a(n) _ in equilibrium price.

First Principles

Economic Models: Trade-Offs and Trade

Price Controls and Quotas: Meddling With Markets

International Trade

Macroeconomics: the Big Picture

GDP and the CPI: Tracking the Macroeconomy

Unemployment and Inflation

Long-Run Economic Growth

Savings, Investment Spending, and the Financial Syst

Income and Expenditure

Aggregate Demand and Aggregate Supply

Fiscal Policy

Money, Banking, and the Federal Reserve System

Monetary Policy

Inflation, Disinflation, and Deflation

Macroeconomics: Events and Ideas

International Macroeconomics

Filters

Exam 3: Supply and Demand

Which influence does NOT shift the supply curve?

Consider the market for iPads. What happens if a fantastic new alternative tablet is developed by Samsung and, at the same time, a boat carrying a large shipment of iPads is attacked by pirates and sunk?

For consumers, pizza and hamburgers are substitutes. A rise in the price of a pizza causes a _____ in the equilibrium price of a hamburger and a(n) _____ in the equilibrium quantity of hamburgers.

Which factor would cause an INCREASE in the supply of a good?

If the price of mozzarella cheese (an ingredient in pizza) declines, there will be:

The _____ apples will decrease when apple prices rise.

For most goods, purchases tend to rise with increases in buyers' incomes and to fall with decreases in buyers' incomes. Such goods are known as:

Which statement illustrates the law of demand?

You notice that the price of Blu-ray players falls and the quantity of Blu-ray players sold increases. You suspect that _____ Blu-ray players shifts to the _____.

Use the following to answer questions: -(Figure: Supply, Demand, and Equilibrium) Use Figure: Supply, Demand, and Equilibrium. In the figure, there will be excess demand for the good at a price of P3.

If there is an excess supply of a good, the problem of scarcity does not apply to that good.

Use the following to answer questions: -(Figure: The Demand and Supply of Wheat) Use Figure: The Demand and Supply of Wheat. What is the equilibrium quantity in this wheat market each period?

If supply is upward sloping, a shift of a demand curve to the right, all other things unchanged, will:

If tortilla chips are a normal good, when there is an increase in income, equilibrium price _____ and equilibrium quantity _____.

It is certain that the equilibrium price will fall when:

Which factor would cause a LEFTWARD shift in the supply curve for a good?:

Use the following to answer questions: -(Figure: Demand and Supply of Gasoline) Use Figure: Demand and Supply of Gasoline. What might cause the supply curve to shift from S2 back to the initial supply curve S1?

A decrease in demand and a decrease in supply will lead to a(n) _____ in equilibrium quantity and a(n) _____ in equilibrium price.

First Principles

Economic Models: Trade-Offs and Trade

Price Controls and Quotas: Meddling With Markets

International Trade

Macroeconomics: the Big Picture

GDP and the CPI: Tracking the Macroeconomy

Unemployment and Inflation

Long-Run Economic Growth

Savings, Investment Spending, and the Financial Syst

Income and Expenditure

Aggregate Demand and Aggregate Supply

Fiscal Policy

Money, Banking, and the Federal Reserve System

Monetary Policy

Inflation, Disinflation, and Deflation

Macroeconomics: Events and Ideas

International Macroeconomics

Filters

For consumers, pizza and hamburgers are substitutes. A rise in the price of a pizza causes a _ in the equilibrium price of a hamburger and a(n) _ in the equilibrium quantity of hamburgers.

You notice that the price of Blu-ray players falls and the quantity of Blu-ray players sold increases. You suspect that _ Blu-ray players shifts to the _.

Use the following to answer questions: -(Figure: Supply, Demand, and Equilibrium) Use Figure: Supply, Demand, and Equilibrium. In the figure, there will be excess demand for the good at a price of P₃.

If tortilla chips are a normal good, when there is an increase in income, equilibrium price _ and equilibrium quantity _.

Use the following to answer questions: -(Figure: Demand and Supply of Gasoline) Use Figure: Demand and Supply of Gasoline. What might cause the supply curve to shift from S₂ back to the initial supply curve S₁?

A decrease in demand and a decrease in supply will lead to a(n) _ in equilibrium quantity and a(n) _ in equilibrium price.