Question 1

The law of supply states that, other things equal, an increase in

Accepted Answer

A) price causes quantity supplied to increase. 
B) price causes quantity supplied to decrease. 
C) quantity supplied causes price to increase. 
D) quantity supplied causes price to decrease. 
A) price causes quantity supplied to increase. 
B) price causes quantity supplied to decrease. 
C) quantity supplied causes price to increase. 
D) quantity supplied causes price to decrease.

Question 2

Figure 4-15  
-Refer to Figure 4-15. Which of the following would cause the supply curve to shift from Supply A to Supply C in the market for sail boats?

Accepted Answer

A) an increase in the price of sailboats 
B) a decrease in the number of firms selling sailboats 
C) a decrease in the price of fiberglass and sail cloth 
D) a decrease in the price of America's Cup sailing t-shirts 
A) an increase in the price of sailboats 
B) a decrease in the number of firms selling sailboats 
C) a decrease in the price of fiberglass and sail cloth 
D) a decrease in the price of America's Cup sailing t-shirts

Question 3

Suppose buyers of coffee and sugar regard the two goods as complements. Then an increase in the price of coffee will cause a(n)

Accepted Answer

A) decrease in the demand for sugar and a decrease in the quantity supplied of sugar. 
B) decrease in the supply of sugar and a decrease in the quantity demanded of sugar. 
C) decrease in the equilibrium price of sugar and an increase in the equilibrium quantity of sugar. 
D) increase in the equilibrium price of sugar and a decrease in the equilibrium quantity of sugar. 
A) decrease in the demand for sugar and a decrease in the quantity supplied of sugar. 
B) decrease in the supply of sugar and a decrease in the quantity demanded of sugar. 
C) decrease in the equilibrium price of sugar and an increase in the equilibrium quantity of sugar. 
D) increase in the equilibrium price of sugar and a decrease in the equilibrium quantity of sugar.

Question 4

In a competitive market, there are so few buyers and so few sellers that each has a significant impact on the market price.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following events must cause equilibrium price to fall?

Accepted Answer

A) demand increases and supply decreases 
B) demand and supply both decrease 
C) demand decreases and supply increases 
D) demand and supply both increase 
A) demand increases and supply decreases 
B) demand and supply both decrease 
C) demand decreases and supply increases 
D) demand and supply both increase

Question 6

The demand for a good or service is determined by

Accepted Answer

A) those who buy the good or service. 
B) the government. 
C) those who sell the good or service. 
D) both those who buy and those who sell the good or service. 
A) those who buy the good or service. 
B) the government. 
C) those who sell the good or service. 
D) both those who buy and those who sell the good or service.

Question 7

In a market economy, supply and demand are important because they

Accepted Answer

A) are direct policy tools used by government agencies to regulate the economy. 
B) illustrate when an market is in equilibrium, but they are not helpful when a market is out of equilibrium. 
C) can be used to predict the impact on the economy of various events and policies. 
D) All of the above are correct. 
A) are direct policy tools used by government agencies to regulate the economy. 
B) illustrate when an market is in equilibrium, but they are not helpful when a market is out of equilibrium. 
C) can be used to predict the impact on the economy of various events and policies. 
D) All of the above are correct.

Question 8

A monopoly is a market with one

Accepted Answer

A) seller, and that seller is a price taker. 
B) seller, and that seller sets the price. 
C) buyer, and that buyer is a price taker. 
D) buyer, and that buyer sets the price. 
A) seller, and that seller is a price taker. 
B) seller, and that seller sets the price. 
C) buyer, and that buyer is a price taker. 
D) buyer, and that buyer sets the price.

Question 9

If orange juice and apple juice are substitutes, an increase in the price of orange juice will shift the demand curve for apple juice to the left.

Accepted Answer

A) True 
 B)False

Question 10

In any economic system, scarce resources have to be allocated among competing uses. Market economies harness the forces of

Accepted Answer

A) government to allocate scarce resources. 
B) supply and demand to allocate scarce resources. 
C) credit cards to allocate scarce resources. 
D) nature to allocate scarce resources. 
A) government to allocate scarce resources. 
B) supply and demand to allocate scarce resources. 
C) credit cards to allocate scarce resources. 
D) nature to allocate scarce resources.

Question 11

When quantity supplied decreases at every possible price, we know that the supply curve has

Accepted Answer

A) shifted to the left. 
B) shifted to the right. 
C) not shifted; rather, we have moved along the supply curve to a new point on the same curve. 
D) not shifted; rather, the supply curve has become flatter. 
A) shifted to the left. 
B) shifted to the right. 
C) not shifted; rather, we have moved along the supply curve to a new point on the same curve. 
D) not shifted; rather, the supply curve has become flatter.

Question 12

Assume the market for pork is perfectly competitive. When one pork buyer exits the market,

Accepted Answer

A) the price of pork increases. 
B) the price of pork decreases. 
C) the price of pork does not change. 
D) there is no longer a market for pork. 
A) the price of pork increases. 
B) the price of pork decreases. 
C) the price of pork does not change. 
D) there is no longer a market for pork.

Question 13

A market supply curve is determined by

Accepted Answer

A) vertically summing individual supply curves. 
B) horizontally summing individual supply curves. 
C) finding the average quantity supplied by sellers at each possible price. 
D) finding the average price at which sellers are willing and able to sell a particular quantity of the good. 
A) vertically summing individual supply curves. 
B) horizontally summing individual supply curves. 
C) finding the average quantity supplied by sellers at each possible price. 
D) finding the average price at which sellers are willing and able to sell a particular quantity of the good.

Question 14

Table 4-16
The following table shows the supply and demand schedules in a market.  
-Refer to Table 4-16. What is the equilibrium quantity in this market?

Accepted Answer

The answer of Table 4-16
The following table shows the supply...

Question 15

Figure 4-7  
-Refer to Figure 4-7. The shift from Db to Da is called

Accepted Answer

A) an increase in demand. 
B) a decrease in demand. 
C) a decrease in quantity demanded. 
D) an increase in quantity demanded. 
A) an increase in demand. 
B) a decrease in demand. 
C) a decrease in quantity demanded. 
D) an increase in quantity demanded.

Question 16

An increase in the price of a good will

Accepted Answer

A) increase demand. 
B) decrease demand. 
C) increase quantity demanded. 
D) decrease quantity demanded. 
A) increase demand. 
B) decrease demand. 
C) increase quantity demanded. 
D) decrease quantity demanded.

Question 17

Figure 4-8  
-Refer to Figure 4-8. Suppose the figure shows the market demand for laptop computers. Suppose the price of wireless printers, a complementary good, decreases. Which of the following changes would occur?

Accepted Answer

A) a movement along D2 from point A to point B 
B) a movement along D2 from point B to point A 
C) a shift from D1 to D2 
D) a shift from D2 to D1 
A) a movement along D2 from point A to point B 
B) a movement along D2 from point B to point A 
C) a shift from D1 to D2 
D) a shift from D2 to D1

Question 18

Figure 4-14  
-Refer to Figure 4-14. Which of the following would explain a movement from E1 to E2?

Accepted Answer

A) There is an improvement in the technology used to produce this good. 
B) The cost of an input to the production of this good increases. 
C) This good becomes very popular. 
D) The price of a substitute good decreases. 
A) There is an improvement in the technology used to produce this good. 
B) The cost of an input to the production of this good increases. 
C) This good becomes very popular. 
D) The price of a substitute good decreases.

Question 19

Which of the following events could cause an increase in the supply of ceiling fans?

Accepted Answer

A) The number of sellers of ceiling fans increases. 
B) There is an increase in the price of air conditioners, and consumers regard air conditioners and ceiling fans as substitutes. 
C) There is an increase in the price of the motor that powers ceiling fans. 
D) All of the above are correct. 
A) The number of sellers of ceiling fans increases. 
B) There is an increase in the price of air conditioners, and consumers regard air conditioners and ceiling fans as substitutes. 
C) There is an increase in the price of the motor that powers ceiling fans. 
D) All of the above are correct.

Question 20

Figure 4-28
​  
-Refer to Figure 4-28. Using the points on the figure, describe the change that would occur if consumer incomes increase and this is an inferior good.

Accepted Answer

The answer of Figure 4-28
​  
-Refer to Figure 4-28....

Exam 4: The Market Forces of Supply and Demand

The law of supply states that, other things equal, an increase in

Figure 4-15 -Refer to Figure 4-15. Which of the following would cause the supply curve to shift from Supply A to Supply C in the market for sail boats?

Suppose buyers of coffee and sugar regard the two goods as complements. Then an increase in the price of coffee will cause a(n)

In a competitive market, there are so few buyers and so few sellers that each has a significant impact on the market price.

Which of the following events must cause equilibrium price to fall?

The demand for a good or service is determined by

In a market economy, supply and demand are important because they

A monopoly is a market with one

If orange juice and apple juice are substitutes, an increase in the price of orange juice will shift the demand curve for apple juice to the left.

In any economic system, scarce resources have to be allocated among competing uses. Market economies harness the forces of

When quantity supplied decreases at every possible price, we know that the supply curve has

Assume the market for pork is perfectly competitive. When one pork buyer exits the market,

A market supply curve is determined by

Table 4-16 The following table shows the supply and demand schedules in a market. -Refer to Table 4-16. What is the equilibrium quantity in this market?

Figure 4-7 -Refer to Figure 4-7. The shift from Db to Da is called

An increase in the price of a good will

Figure 4-8 -Refer to Figure 4-8. Suppose the figure shows the market demand for laptop computers. Suppose the price of wireless printers, a complementary good, decreases. Which of the following changes would occur?

Figure 4-14 -Refer to Figure 4-14. Which of the following would explain a movement from E1 to E2?

Which of the following events could cause an increase in the supply of ceiling fans?

Figure 4-28 ​ -Refer to Figure 4-28. Using the points on the figure, describe the change that would occur if consumer incomes increase and this is an inferior good.

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Application: The Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers in Microeconomics

Filters

Figure 4-28 -Refer to Figure 4-28. Using the points on the figure, describe the change that would occur if consumer incomes increase and this is an inferior good.