Question 1

Two goods are substitutes when a decrease in the price of one good

Accepted Answer

A) decreases the demand for the other good. 
B) decreases the quantity demanded of the other good. 
C) increases the demand for the other good. 
D) increases the quantity demanded of the other good. 
A) decreases the demand for the other good. 
B) decreases the quantity demanded of the other good. 
C) increases the demand for the other good. 
D) increases the quantity demanded of the other good.

Question 2

Figure 4-26  
-Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for orange juice of an announcement by the American Dental Association that orange juice erodes tooth enamel?

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 3

Figure 4-18  
-Refer to Figure 4-18. At a price of $15, there would be a

Accepted Answer

A) surplus of 400 units. 
B) shortage of 200 units. 
C) shortage of 400 units. 
D) shortage of 600 units. 
A) surplus of 400 units. 
B) shortage of 200 units. 
C) shortage of 400 units. 
D) shortage of 600 units.

Question 4

Figure 4-27
Panel (a)
Panel (b)     Panel (c)
Panel (d)    
-Refer to Figure 4-27. Which of the four panels represents the market for pizza delivery in a college town as we go from summer to the beginning of the fall semester?

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 5

Figure 4-6    
-Refer to Figure 4-6. Suppose that the federal government is concerned about obesity in the United States. Congress is considering two plans. One would require "junk food" producers to include warning labels on all junk food. The other would impose a tax on all products considered to be junk food. If the warning labels are successful, we could illustrate the plan as producing a movement from

Accepted Answer

A) Point A to Point B in Panel 1. 
B) Point B to Point A in Panel 1. 
C) Point A to Point C in Panel 2. 
D) Point C to Point A in Panel 2. 
A) Point A to Point B in Panel 1. 
B) Point B to Point A in Panel 1. 
C) Point A to Point C in Panel 2. 
D) Point C to Point A in Panel 2.

Question 6

If a good or service has only one seller, then the seller is called a monopoly.

Accepted Answer

A) True 
 B)False

Question 7

If a increase in income decreases the demand for a good, then the good is a(n)

Accepted Answer

A) substitute good. 
B) complementary good. 
C) normal good. 
D) inferior good. 
A) substitute good. 
B) complementary good. 
C) normal good. 
D) inferior good.

Question 8

Suppose that demand for a good increases and, at the same time, supply of the good decreases. What would happen in the market for the good?

Accepted Answer

A) Equilibrium price would decrease, but the impact on equilibrium quantity would be ambiguous. 
B) Equilibrium price would increase, but the impact on equilibrium quantity would be ambiguous. 
C) Equilibrium quantity would decrease, but the impact on equilibrium price would be ambiguous. 
D) Equilibrium quantity would increase, but the impact on equilibrium price would be ambiguous. 
A) Equilibrium price would decrease, but the impact on equilibrium quantity would be ambiguous. 
B) Equilibrium price would increase, but the impact on equilibrium quantity would be ambiguous. 
C) Equilibrium quantity would decrease, but the impact on equilibrium price would be ambiguous. 
D) Equilibrium quantity would increase, but the impact on equilibrium price would be ambiguous.

Question 9

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

Accepted Answer

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

Question 10

When a seller expects the price of its product to decrease in the future, the seller's supply curve shifts left now.

Accepted Answer

A) True 
 B)False

Question 11

In competitive markets, which of the following is not correct?

Accepted Answer

A) Firms produce identical products. 
B) No individual buyer can influence the market price. 
C) Some sellers can set prices. 
D) Buyers are price takers. 
A) Firms produce identical products. 
B) No individual buyer can influence the market price. 
C) Some sellers can set prices. 
D) Buyers are price takers.

Question 12

In competitive markets,

Accepted Answer

A) firms produce identical products. 
B) buyers can influence the market price more easily than sellers. 
C) markets are more likely to be in equilibrium. 
D) sellers are price setters. 
A) firms produce identical products. 
B) buyers can influence the market price more easily than sellers. 
C) markets are more likely to be in equilibrium. 
D) sellers are price setters.

Question 13

Figure 4-27
Panel (a)
Panel (b)     Panel (c)
Panel (d)    
-Refer to Figure 4-27. Which of the four panels illustrates a decrease in quantity supplied?

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 14

Once the supply curve for a product or service is drawn, it

Accepted Answer

A) remains stable over time. 
B) can shift either rightward or leftward. 
C) is possible to move along the curve, but the curve will not shift. 
D) tends to become steeper over time. 
A) remains stable over time. 
B) can shift either rightward or leftward. 
C) is possible to move along the curve, but the curve will not shift. 
D) tends to become steeper over time.

Question 15

Figure 4-25
The graph below pertains to the supply of paper to colleges and universities.  
-Refer to Figure 4-25. All else equal, an increase in the price of the pulp used in the paper production process would cause a move from

Accepted Answer

A) x to y. 
B) y to x. 
C) SA to SB. 
D) SB to SA. 
A) x to y. 
B) y to x. 
C) SA to SB. 
D) SB to SA.

Question 16

Figure 4-31
Consider the market for 2-packs of light bulbs below.
​  
-Refer to Figure 4-31. Suppose there is an improvement in technology in this market and the price of lamps, a complementary good, increases. What changes do you predict in the equilibrium price and quantity?

Accepted Answer

Equilibrium price de

Question 17

The quantity supplied of a good is the amount that

Accepted Answer

A) buyers are willing and able to purchase. 
B) sellers are able to produce. 
C) buyers and sellers agree will be brought to market. 
D) sellers are willing and able to sell. 
A) buyers are willing and able to purchase. 
B) sellers are able to produce. 
C) buyers and sellers agree will be brought to market. 
D) sellers are willing and able to sell.

Question 18

Table 4-13
The demand schedule below pertains to sandwiches demanded per week.  
-Refer to Table 4-13. Suppose Harry, Darby, and Jake are the only demanders of sandwiches and that the market demand violates the law of demand. Then, in the table, the value of x must be

Accepted Answer

A) less than or equal to 5. 
B) greater than or equal to 5. 
C) greater than or equal to 7. 
D) greater than or equal to 10. 
A) less than or equal to 5. 
B) greater than or equal to 5. 
C) greater than or equal to 7. 
D) greater than or equal to 10.

Question 19

You have been asked by your economics professor to graph the market for lumber and then to analyze the change that would occur in equilibrium price as a result of recent forest fires in the west. Your first step would be to

Accepted Answer

A) decide which direction to shift the curve. 
B) decide whether the fires affected demand or supply. 
C) graph the shift to see the effect on equilibrium. 
D) None of the above is correct. 
A) decide which direction to shift the curve. 
B) decide whether the fires affected demand or supply. 
C) graph the shift to see the effect on equilibrium. 
D) None of the above is correct.

Question 20

If macaroni and cheese is an inferior good, what would happen to the equilibrium price and quantity of macaroni and cheese if consumers' incomes rise?

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.

Exam 4: The Market Forces of Supply and Demand

Two goods are substitutes when a decrease in the price of one good

Figure 4-26 -Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for orange juice of an announcement by the American Dental Association that orange juice erodes tooth enamel?

Figure 4-18 -Refer to Figure 4-18. At a price of $15, there would be a

Figure 4-27 Panel (a) Panel (b) Panel (c) Panel (d) -Refer to Figure 4-27. Which of the four panels represents the market for pizza delivery in a college town as we go from summer to the beginning of the fall semester?

If a good or service has only one seller, then the seller is called a monopoly.

If a increase in income decreases the demand for a good, then the good is a(n)

Suppose that demand for a good increases and, at the same time, supply of the good decreases. What would happen in the market for the good?

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

When a seller expects the price of its product to decrease in the future, the seller's supply curve shifts left now.

In competitive markets, which of the following is not correct?

In competitive markets,

Figure 4-27 Panel (a) Panel (b) Panel (c) Panel (d) -Refer to Figure 4-27. Which of the four panels illustrates a decrease in quantity supplied?

Once the supply curve for a product or service is drawn, it

Figure 4-25 The graph below pertains to the supply of paper to colleges and universities. -Refer to Figure 4-25. All else equal, an increase in the price of the pulp used in the paper production process would cause a move from

Figure 4-31 Consider the market for 2-packs of light bulbs below. ​ -Refer to Figure 4-31. Suppose there is an improvement in technology in this market and the price of lamps, a complementary good, increases. What changes do you predict in the equilibrium price and quantity?

The quantity supplied of a good is the amount that

Table 4-13 The demand schedule below pertains to sandwiches demanded per week. -Refer to Table 4-13. Suppose Harry, Darby, and Jake are the only demanders of sandwiches and that the market demand violates the law of demand. Then, in the table, the value of x must be

You have been asked by your economics professor to graph the market for lumber and then to analyze the change that would occur in equilibrium price as a result of recent forest fires in the west. Your first step would be to

If macaroni and cheese is an inferior good, what would happen to the equilibrium price and quantity of macaroni and cheese if consumers' incomes rise?

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

Applications: 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

Measuring a Nation S Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

Tools of Finance

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

Filters

Figure 4-31 Consider the market for 2-packs of light bulbs below. -Refer to Figure 4-31. Suppose there is an improvement in technology in this market and the price of lamps, a complementary good, increases. What changes do you predict in the equilibrium price and quantity?