Question 1

When the market price is below the equilibrium price, the quantity of the good demanded exceeds the quantity supplied.

Accepted Answer

A) True 
 B)False

Question 2

Figure 4-1   ​
-Refer to Figure 4-1. It is apparent from the figure that the

Accepted Answer

A) good is inferior. 
B) demand for the good decreases as income increases. 
C) demand for the good conforms to the law of demand. 
D) good is a normal good. 
A) good is inferior. 
B) demand for the good decreases as income increases. 
C) demand for the good conforms to the law of demand. 
D) good is a normal good.

Question 3

An increase in demand shifts the demand curve to the left.

Accepted Answer

A) True 
 B)False

Question 4

A likely example of substitute goods for most people would be

Accepted Answer

A) tennis balls and tennis rackets. 
B) shoes and socks. 
C) cereal and milk. 
D) iced tea and lemonade. 
A) tennis balls and tennis rackets. 
B) shoes and socks. 
C) cereal and milk. 
D) iced tea and lemonade.

Question 5

Which of the following is not held constant in a demand schedule?

Accepted Answer

A) Income 
B) Tastes 
C) Price 
D) Expectations 
A) Income 
B) Tastes 
C) Price 
D) Expectations

Question 6

All goods and services are sold in perfectly competitive markets.

Accepted Answer

A) True 
 B)False

Question 7

When the price of a good is high, selling the good is profitable, and so the quantity supplied is large.

Accepted Answer

A) True 
 B)False

Question 8

Suppose there is a flood in St. Louis, Missouri, that destroys several beer bottling facilities. Which of the following would not be a direct result of this event?

Accepted Answer

A) Sellers would not be able to produce and sell as much as before at each relevant price. 
B) The supply would decrease. 
C) Buyers would not be willing to buy as much as before at each relevant price. 
D) The equilibrium price would rise. 
A) Sellers would not be able to produce and sell as much as before at each relevant price. 
B) The supply would decrease. 
C) Buyers would not be willing to buy as much as before at each relevant price. 
D) The equilibrium price would rise.

Question 9

A likely example of complementary goods for most people would be

Accepted Answer

A) pencils and pens. 
B) lawnmowers and automobiles. 
C) coffee and sugar. 
D) butter and margarine. 
A) pencils and pens. 
B) lawnmowers and automobiles. 
C) coffee and sugar. 
D) butter and margarine.

Question 10

Which of the following would not increase in response to a decrease in the price of ironing boards?

Accepted Answer

A) The quantity of irons demanded at each possible price of irons 
B) The equilibrium quantity of irons 
C) The equilibrium price of irons 
D) The quantity of irons supplied at each possible price of irons 
A) The quantity of irons demanded at each possible price of irons 
B) The equilibrium quantity of irons 
C) The equilibrium price of irons 
D) The quantity of irons supplied at each possible price of irons

Question 11

Figure 4-8  
-Refer to Figure 4-8. All else equal, an increase in the income of buyers who consider turkey to be an inferior good would cause a move from

Accepted Answer

A) Da to Db. 
B) Db to Da. 
C) x to y. 
D) y to x. 
A) Da to Db. 
B) Db to Da. 
C) x to y. 
D) y to x.

Question 12

The demand curve is the upward-sloping line relating price and quantity demanded.

Accepted Answer

A) True 
 B)False

Question 13

Figure 4-13
   ​
-If corn is an input into the production of ethanol, will a decrease in the price of corn increase the supply of ethanol or decrease the supply of ethanol?

Accepted Answer

The supply

Question 14

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 right.

Accepted Answer

A) True 
 B)False

Question 15

A decrease in the price of baseball bats will decrease the demand for baseballs.

Accepted Answer

A) True 
 B)False

Question 16

A movement upward and to the left along a given demand curve is called a decrease in demand.

Accepted Answer

A) True 
 B)False

Question 17

Table 4-9
The following table shows the supply and demand schedules in a market.
 $$\begin{array} { | l | l | l | } 
\hline \text { Price (\$) } & \begin{array} { l } 
\text { Quantity } \
\text { Demanded } \
\text { (units) }
\end{array} & \begin{array} { l } 
\text { Quantity } \
\text { Supplied } \
\text { (units) }
\end{array} \
\hline 0 & 50 & 0 \
\hline 2 & 40 & 15 \
\hline 4 & 30 & 30 \
\hline 6 & 20 & 45 \
\hline 8 & 10 & 60 \
\hline 10 & 0 & 75 \
\hline
\end{array}$$
-Refer to Table 4-9. At a price of $8, how large of a surplus will there be in this market?

Accepted Answer

The answer of Table 4-9
The following table shows the supply...

Question 18

An increase in supply will cause a decrease in price, which will cause an increase in demand.

Accepted Answer

A) True 
 B)False

Question 19

Individual supply curves are summed vertically to obtain the market supply curve.

Accepted Answer

A) True 
 B)False

Question 20

Table 4-2
​
​
   ​
​
-Refer to Table 4-2. If these are the only four buyers in the market, then the market quantity demanded at a price of $1.50 is

Accepted Answer

A) 12 units. 
B) 30 units. 
C) 8 units. 
D) 24 units. 
A) 12 units. 
B) 30 units. 
C) 8 units. 
D) 24 units.

Exam 4: The Market Forces of Supply and Demand

When the market price is below the equilibrium price, the quantity of the good demanded exceeds the quantity supplied.

Figure 4-1 ​ -Refer to Figure 4-1. It is apparent from the figure that the

An increase in demand shifts the demand curve to the left.

A likely example of substitute goods for most people would be

Which of the following is not held constant in a demand schedule?

All goods and services are sold in perfectly competitive markets.

When the price of a good is high, selling the good is profitable, and so the quantity supplied is large.

Suppose there is a flood in St. Louis, Missouri, that destroys several beer bottling facilities. Which of the following would not be a direct result of this event?

A likely example of complementary goods for most people would be

Which of the following would not increase in response to a decrease in the price of ironing boards?

Figure 4-8 -Refer to Figure 4-8. All else equal, an increase in the income of buyers who consider turkey to be an inferior good would cause a move from

The demand curve is the upward-sloping line relating price and quantity demanded.

Figure 4-13 ​ -If corn is an input into the production of ethanol, will a decrease in the price of corn increase the supply of ethanol or decrease the supply of ethanol?

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 right.

A decrease in the price of baseball bats will decrease the demand for baseballs.

A movement upward and to the left along a given demand curve is called a decrease in demand.

An increase in supply will cause a decrease in price, which will cause an increase in demand.

Individual supply curves are summed vertically to obtain the market supply curve.

Table 4-2 ​ ​ ​ ​ -Refer to Table 4-2. If these are the only four buyers in the market, then the market quantity demanded at a price of $1.50 is

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 Nations 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 4-1 -Refer to Figure 4-1. It is apparent from the figure that the

Figure 4-13 -If corn is an input into the production of ethanol, will a decrease in the price of corn increase the supply of ethanol or decrease the supply of ethanol?

Table 4-2 -Refer to Table 4-2. If these are the only four buyers in the market, then the market quantity demanded at a price of $1.50 is