Question 1

When it comes to people's tastes, economists generally believe that

Accepted Answer

A) tastes are based on forces that are well within the realm of economics. 
B) tastes are based on historical and psychological forces that are beyond the realm of economics. 
C) tastes can only be studied through well-constructed, real-life models. 
D) because tastes do not directly affect demand, there is little need to explain people's tastes. 
A) tastes are based on forces that are well within the realm of economics. 
B) tastes are based on historical and psychological forces that are beyond the realm of economics. 
C) tastes can only be studied through well-constructed, real-life models. 
D) because tastes do not directly affect demand, there is little need to explain people's tastes.

Question 2

A decrease in income will shift the demand curve for an inferior good to the right.

Accepted Answer

A) True 
 B)False

Question 3

In competitive markets, buyers

Accepted Answer

A) are price takers, but sellers are price setters. 
B) are price setters, but sellers are price takers. 
C) and sellers are price takers. 
D) and sellers are price setters. 
A) are price takers, but sellers are price setters. 
B) are price setters, but sellers are price takers. 
C) and sellers are price takers. 
D) and sellers are price setters.

Question 4

Figure 4-12
Firm A
Firm B    
-Refer to Figure 4-12. If these are the only two sellers in the market, then the market quantity supplied at a price of $4 is

Accepted Answer

A) 6 units. 
B) 7 units. 
C) 8 units. 
D) 14 units. 
A) 6 units. 
B) 7 units. 
C) 8 units. 
D) 14 units.

Question 5

Supply and demand together determine the price and quantity of a good sold in a market.

Accepted Answer

A) True 
 B)False

Question 6

If a higher price means a greater quantity supplied, then the supply curve slopes upward.

Accepted Answer

A) True 
 B)False

Question 7

Today, producers changed their expectations about the future. This change

Accepted Answer

A) can cause a movement along a supply curve. 
B) can affect future supply, but not today's supply. 
C) can affect today's supply. 
D) cannot affect either today's supply or future supply. 
A) can cause a movement along a supply curve. 
B) can affect future supply, but not today's supply. 
C) can affect today's supply. 
D) cannot affect either today's supply or future supply.

Question 8

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

Accepted Answer

A) play a critical role in the allocation of the economy's scarce resources. 
B) determine how much of each good gets produced. 
C) can be used to predict the impact on the economy of various events and policies. 
D) All of the above are correct. 
A) play a critical role in the allocation of the economy's scarce resources. 
B) determine how much of each good gets produced. 
C) can be used to predict the impact on the economy of various events and policies. 
D) All of the above are correct.

Question 9

Workers at a bicycle assembly plant currently earn the mandatory minimum wage. If the federal government increases the minimum wage by $1.00 per hour, then it is likely that the

Accepted Answer

A) demand for bicycle assembly workers will increase. 
B) supply of bicycles will shift to the right. 
C) supply of bicycles will shift to the left. 
D) firm must increase output to maintain profit levels. 
A) demand for bicycle assembly workers will increase. 
B) supply of bicycles will shift to the right. 
C) supply of bicycles will shift to the left. 
D) firm must increase output to maintain profit levels.

Question 10

Table 4-1  
-Refer to Table 4-1. Which of the following illustrates the market demand curve?

Accepted Answer

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

Question 11

Figure 4-29
​  
-Refer to Figure 4-29. The movement from S1 to S2 is a

Accepted Answer

The answer of Figure 4-29
​  
-Refer to Figure 4-29....

Question 12

The following table contains a supply schedule for a good.   If the law of supply applies to this good, then Q1 could be

Accepted Answer

A) 0. 
B) 50. 
C) 100. 
D) 150. 
A) 0. 
B) 50. 
C) 100. 
D) 150.

Question 13

Figure 4-20  
-Refer to Figure 4-20. In this market, equilibrium price and quantity, respectively, are

Accepted Answer

A) $15 and 400 units. 
B) $20 and 600 units. 
C) $25 and 500 units. 
D) $25 and 800 units. 
A) $15 and 400 units. 
B) $20 and 600 units. 
C) $25 and 500 units. 
D) $25 and 800 units.

Question 14

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 15

If a firm is a price taker, it operates in a

Accepted Answer

A) competitive market. 
B) monopoly market. 
C) oligopoly market. 
D) monopolistically competitive market. 
A) competitive market. 
B) monopoly market. 
C) oligopoly market. 
D) monopolistically competitive market.

Question 16

If textbooks and study guides are complements, then an increase in the price of textbooks will result in

Accepted Answer

A) more textbooks being sold. 
B) more study guides being sold. 
C) fewer study guides being sold. 
D) no difference in the quantity sold of either good. 
A) more textbooks being sold. 
B) more study guides being sold. 
C) fewer study guides being sold. 
D) no difference in the quantity sold of either good.

Question 17

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 beach towels?

Accepted Answer

A) an increase in the price of beach towels 
B) an expectation by firms that the price of beach towels will increase in the very near future 
C) a decrease in the price of cotton 
D) a decrease in the number of firms selling beach towels 
A) an increase in the price of beach towels 
B) an expectation by firms that the price of beach towels will increase in the very near future 
C) a decrease in the price of cotton 
D) a decrease in the number of firms selling beach towels

Question 18

Table 4-10
The following table shows the number of cases of water each seller is willing to sell at the prices listed.  
-Refer to Table 4-10. If the four suppliers listed are the only suppliers in this market and the market demand schedule is:   the equilibrium price and quantity are

Accepted Answer

A) $0.00 and 1200 cases 
B) $3.00 and 300 cases 
C) $6.00 and 600 cases 
D) $9.00 and 600 cases 
A) $0.00 and 1200 cases 
B) $3.00 and 300 cases 
C) $6.00 and 600 cases 
D) $9.00 and 600 cases

Question 19

Advances in production technology typically reduce firms' costs, which increases the quantity supplied at each price.

Accepted Answer

A) True 
 B)False

Question 20

If the producers of canned green beans expect the price of canned green beans to increase in the future due to an increase in demand, they may put some of their current production into storage and supply less in the market today.

Accepted Answer

A) True 
 B)False

Exam 4: The Market Forces of Supply and Demand

When it comes to people's tastes, economists generally believe that

A decrease in income will shift the demand curve for an inferior good to the right.

In competitive markets, buyers

Figure 4-12 Firm A Firm B -Refer to Figure 4-12. If these are the only two sellers in the market, then the market quantity supplied at a price of $4 is

Supply and demand together determine the price and quantity of a good sold in a market.

If a higher price means a greater quantity supplied, then the supply curve slopes upward.

Today, producers changed their expectations about the future. This change

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

Workers at a bicycle assembly plant currently earn the mandatory minimum wage. If the federal government increases the minimum wage by $1.00 per hour, then it is likely that the

Table 4-1 -Refer to Table 4-1. Which of the following illustrates the market demand curve?

Figure 4-29 ​ -Refer to Figure 4-29. The movement from S1 to S2 is a

The following table contains a supply schedule for a good. If the law of supply applies to this good, then Q1 could be

Figure 4-20 -Refer to Figure 4-20. In this market, equilibrium price and quantity, respectively, are

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

If a firm is a price taker, it operates in a

If textbooks and study guides are complements, then an increase in the price of textbooks will result 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 beach towels?

Table 4-10 The following table shows the number of cases of water each seller is willing to sell at the prices listed. -Refer to Table 4-10. If the four suppliers listed are the only suppliers in this market and the market demand schedule is: the equilibrium price and quantity are

Advances in production technology typically reduce firms' costs, which increases the quantity supplied at each price.

If the producers of canned green beans expect the price of canned green beans to increase in the future due to an increase in demand, they may put some of their current production into storage and supply less in the market today.

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 4-29 -Refer to Figure 4-29. The movement from S1 to S2 is a