Question 1

The market for ice cream is a

Accepted Answer

A) monopolistic market. 
B) highly competitive market. 
C) highly organized market. 
D) Both b and c are correct. 
A) monopolistic market. 
B) highly competitive market. 
C) highly organized market. 
D) Both b and c are correct.

Question 2

Figure 4-21  
-Refer to Figure 4-21. At a price of $16, there is a

Accepted Answer

A) surplus of 1 unit. 
B) surplus of 3 units. 
C) shortage of 1 unit. 
D) shortage of 3 units. 
A) surplus of 1 unit. 
B) surplus of 3 units. 
C) shortage of 1 unit. 
D) shortage of 3 units.

Question 3

The supply curve for a good is a line that relates

Accepted Answer

A) profit and quantity supplied. 
B) quantity supplied and quantity demanded. 
C) price and quantity supplied. 
D) price and profit. 
A) profit and quantity supplied. 
B) quantity supplied and quantity demanded. 
C) price and quantity supplied. 
D) price and profit.

Question 4

Most markets in the economy are

Accepted Answer

A) markets in which sellers, rather than buyers, control the price of the product. 
B) markets in which buyers, rather than sellers, control the price of the product. 
C) perfectly competitive. 
D) highly competitive. 
A) markets in which sellers, rather than buyers, control the price of the product. 
B) markets in which buyers, rather than sellers, control the price of the product. 
C) perfectly competitive. 
D) highly competitive.

Question 5

A decrease in the price of blueberries will decrease both the equilibrium price and quantity in the market for blueberry muffins.

Accepted Answer

A) True 
 B)False

Question 6

Figure 4-22  
-Refer to Figure 4-22. At a price of $20, there is a

Accepted Answer

A) surplus of 4 units. 
B) surplus of 8 units. 
C) shortage of 4 units. 
D) shortage of 8 units. 
A) surplus of 4 units. 
B) surplus of 8 units. 
C) shortage of 4 units. 
D) shortage of 8 units.

Question 7

Figure 4-8  
-Refer to Figure 4-8. Suppose the figure shows the market demand for Big Box e-readers. Suppose the price of the leading competitor's e-readers, a substitute 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 8

Consider the market for portable air conditioners in equilibrium. A summer of unseasonably cool weather would cause

Accepted Answer

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

Question 9

Figure 4-26  
-Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for convertible automobiles of an increase in the price of steel?

Accepted Answer

A) Point A to Point B 
B) Point C to Point B 
C) Point C to Point D 
D) Point A to Point D 
A) Point A to Point B 
B) Point C to Point B 
C) Point C to Point D 
D) Point A to Point D

Question 10

What would happen to the equilibrium price and quantity of lattés if consumers' incomes rise and lattés are a normal good?

Accepted Answer

A) Both the equilibrium price and quantity would increase. 
B) Both the equilibrium price and quantity would decrease. 
C) The equilibrium price would increase, and the equilibrium quantity would decrease. 
D) The equilibrium price would decrease, and the equilibrium quantity would increase. 
A) Both the equilibrium price and quantity would increase. 
B) Both the equilibrium price and quantity would decrease. 
C) The equilibrium price would increase, and the equilibrium quantity would decrease. 
D) The equilibrium price would decrease, and the equilibrium quantity would increase.

Question 11

If consumers view cappuccinos and lattés as substitutes, what would happen to the equilibrium price and quantity of lattés if the price of cappuccinos rises?

Accepted Answer

A) Both the equilibrium price and quantity would increase. 
B) Both the equilibrium price and quantity would decrease. 
C) The equilibrium price would increase, and the equilibrium quantity would decrease. 
D) The equilibrium price would decrease, and the equilibrium quantity would increase. 
A) Both the equilibrium price and quantity would increase. 
B) Both the equilibrium price and quantity would decrease. 
C) The equilibrium price would increase, and the equilibrium quantity would decrease. 
D) The equilibrium price would decrease, and the equilibrium quantity would increase.

Question 12

Table 4-9  
-Refer to Table 4-9. Which combination would produce an increase in equilibrium price and an indeterminate change in equilibrium quantity?

Accepted Answer

A) A 
B) B 
C) C 
D) D 
A) A 
B) B 
C) C 
D) D

Question 13

Which of these statements best represents the law of supply?

Accepted Answer

A) When input prices increase, sellers produce less of the good. 
B) When production technology improves, sellers produce less of the good. 
C) When the price of a good decreases, sellers produce less of the good. 
D) When sellers' supplies of a good increase, the price of the good increases. 
A) When input prices increase, sellers produce less of the good. 
B) When production technology improves, sellers produce less of the good. 
C) When the price of a good decreases, sellers produce less of the good. 
D) When sellers' supplies of a good increase, the price of the good increases.

Question 14

A decrease in the price of peanut butter will increase both the equilibrium price and quantity in the market for jelly.

Accepted Answer

A) True 
 B)False

Question 15

Table 4-3  
-Refer to Table 4-3. For whom is the good a normal good?

Accepted Answer

A) Bert only 
B) Grover only 
C) Bert, Ernie, Grover, and Oscar 
D) This cannot be determined from the table. 
A) Bert only 
B) Grover only 
C) Bert, Ernie, Grover, and Oscar 
D) This cannot be determined from the table.

Question 16

When quantity supplied exceeds quantity demanded at the current market price, the market has a surplus, and market price will likely rise in the future to eliminate the surplus.

Accepted Answer

A) True 
 B)False

Question 17

According to the law of demand, when price increases the quantity demanded of a good

Accepted Answer

The answer of According to the law of demand, when...

Question 18

A rightward shift of a demand curve is called a(n)

Accepted Answer

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

Question 19

A decrease in the price of a product and an increase in the number of buyers in the market affect the demand curve in the same general way.

Accepted Answer

A) True 
 B)False

Question 20

Prices allocate a market economy's scarce resources.

Accepted Answer

A) True 
 B)False

Exam 4: The Market Forces of Supply and Demand

The market for ice cream is a

Figure 4-21 -Refer to Figure 4-21. At a price of $16, there is a

The supply curve for a good is a line that relates

Most markets in the economy are

A decrease in the price of blueberries will decrease both the equilibrium price and quantity in the market for blueberry muffins.

Figure 4-22 -Refer to Figure 4-22. At a price of $20, there is a

Figure 4-8 -Refer to Figure 4-8. Suppose the figure shows the market demand for Big Box e-readers. Suppose the price of the leading competitor's e-readers, a substitute good, decreases. Which of the following changes would occur?

Consider the market for portable air conditioners in equilibrium. A summer of unseasonably cool weather would cause

Figure 4-26 -Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for convertible automobiles of an increase in the price of steel?

What would happen to the equilibrium price and quantity of lattés if consumers' incomes rise and lattés are a normal good?

If consumers view cappuccinos and lattés as substitutes, what would happen to the equilibrium price and quantity of lattés if the price of cappuccinos rises?

Table 4-9 -Refer to Table 4-9. Which combination would produce an increase in equilibrium price and an indeterminate change in equilibrium quantity?

Which of these statements best represents the law of supply?

A decrease in the price of peanut butter will increase both the equilibrium price and quantity in the market for jelly.

Table 4-3 -Refer to Table 4-3. For whom is the good a normal good?

When quantity supplied exceeds quantity demanded at the current market price, the market has a surplus, and market price will likely rise in the future to eliminate the surplus.

According to the law of demand, when price increases the quantity demanded of a good

A rightward shift of a demand curve is called a(n)

A decrease in the price of a product and an increase in the number of buyers in the market affect the demand curve in the same general way.

Prices allocate a market economy's scarce resources.

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

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