Question 1

If the number of buyers in a market decreases,then

Accepted Answer

A)  demand will increase. 
B)  demand will decrease. 
C)  supply will increase. 
D)  supply will decrease. 
A)  demand will increase. 
B)  demand will decrease. 
C)  supply will increase. 
D)  supply will decrease.

Question 2

Holding all other things constant,a higher price for ski lift tickets would

Accepted Answer

A)  increase the number of skiers. 
B)  increase the price of skis. 
C)  decrease the number of skis sold. 
D)  decrease the demand for other winter recreational activities. 
A)  increase the number of skiers. 
B)  increase the price of skis. 
C)  decrease the number of skis sold. 
D)  decrease the demand for other winter recreational activities.

Question 3

In a market economy,

Accepted Answer

A)  supply determines demand and demand, in turn, determines prices. 
B)  demand determines supply and supply, in turn, determines prices. 
C)  the allocation of scarce resources determines prices and prices, in turn, determine supply and demand. 
D)  supply and demand determine prices and prices, in turn, allocate the economy's scarce resources. 
A)  supply determines demand and demand, in turn, determines prices. 
B)  demand determines supply and supply, in turn, determines prices. 
C)  the allocation of scarce resources determines prices and prices, in turn, determine supply and demand. 
D)  supply and demand determine prices and prices, in turn, allocate the economy's scarce resources.

Question 4

A surplus is the same as an excess demand.

Accepted Answer

A) True 
 B)False

Question 5

When the price of hot dogs changes,the demand curve for hot dogs

Accepted Answer

A)  shifts because the price of hot dogs is measured on the vertical axis of the graph. 
B)  shifts because the quantity demanded of hot dogs is measured on the horizontal axis of the graph. 
C)  does not shift because the price of hot dogs is measured on the vertical axis of the graph. 
D)  does not shift because the price of hot dogs is measured on the horizontal axis of the graph. 
A)  shifts because the price of hot dogs is measured on the vertical axis of the graph. 
B)  shifts because the quantity demanded of hot dogs is measured on the horizontal axis of the graph. 
C)  does not shift because the price of hot dogs is measured on the vertical axis of the graph. 
D)  does not shift because the price of hot dogs is measured on the horizontal axis of the graph.

Question 6

The law of demand states that,other things equal,when the price of a good

Accepted Answer

A)  falls, the demand for the good rises. 
B)  rises, the quantity demanded of the good rises. 
C)  rises, the demand for the good falls. 
D)  falls, the quantity demanded of the good rises. 
A)  falls, the demand for the good rises. 
B)  rises, the quantity demanded of the good rises. 
C)  rises, the demand for the good falls. 
D)  falls, the quantity demanded of the good rises.

Question 7

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 8

Figure 4-13
  
-Refer to Figure 4-13.The shift from S to S' in the market for peaches could be caused by a(n)

Accepted Answer

A)  increase in the price of peaches. 
B)  decrease in the price of pears. 
C)  increase in income. 
D)  decrease in the labor costs of the workers who pick peaches. 
A)  increase in the price of peaches. 
B)  decrease in the price of pears. 
C)  increase in income. 
D)  decrease in the labor costs of the workers who pick peaches.

Question 9

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 10

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

Accepted Answer

A) True 
 B)False

Question 11

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 12

Figure 4-13
  
-Refer to Figure 4-13.The shift from S' to S in the market for chocolate cake could be caused by a(n)

Accepted Answer

A)  decrease in the number of commercial bakers. 
B)  improvement in oven technology. 
C)  decrease in the price of butter. 
D)  decrease in the price of chocolate cake. 
A)  decrease in the number of commercial bakers. 
B)  improvement in oven technology. 
C)  decrease in the price of butter. 
D)  decrease in the price of chocolate cake.

Question 13

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

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 14

Which of the following events would cause the price of oranges to fall?

Accepted Answer

A)  There is a shortage of oranges. 
B)  The FDA announces that bananas cause strokes, and oranges and bananas are substitutes. 
C)  The price of land throughout Florida decreases, and Florida produces a significant proportion of the nation's oranges. 
D)  All of the above are correct. 
A)  There is a shortage of oranges. 
B)  The FDA announces that bananas cause strokes, and oranges and bananas are substitutes. 
C)  The price of land throughout Florida decreases, and Florida produces a significant proportion of the nation's oranges. 
D)  All of the above are correct.

Question 15

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

Accepted Answer

A) True 
 B)False

Question 16

When quantity demanded has increased at every price,it might be because

Accepted Answer

A)  the number of buyers in the market has decreased. 
B)  income has increased, and the good is an inferior good. 
C)  the costs incurred by sellers producing the good have decreased. 
D)  the price of a complementary good has decreased. 
A)  the number of buyers in the market has decreased. 
B)  income has increased, and the good is an inferior good. 
C)  the costs incurred by sellers producing the good have decreased. 
D)  the price of a complementary good has decreased.

Question 17

Figure 4-19
The diagram below pertains to the demand for turkey in the United States.
  
-Refer to Figure 4-19.All else equal,the premature deaths of thousands of turkeys 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 18

Public service announcements,mandatory health warnings on cigarette packages,and the prohibition of cigarette advertising on television are all policies aimed at shifting the demand curve for cigarettes to the right.

Accepted Answer

A) True 
 B)False

Question 19

Figure 4-22

-Refer to Figure 4-22.Panel (d)shows which of the following?

Accepted Answer

A)  a decrease in demand and a decrease in quantity supplied 
B)  a decrease in demand and a decrease in supply 
C)  a decrease in quantity demanded and a decrease in quantity supplied 
D)  a decrease in quantity demanded and a decrease in supply 
A)  a decrease in demand and a decrease in quantity supplied 
B)  a decrease in demand and a decrease in supply 
C)  a decrease in quantity demanded and a decrease in quantity supplied 
D)  a decrease in quantity demanded and a decrease in supply

Question 20

An early frost in the vineyards of Napa Valley would cause a(n)

Accepted Answer

A)  increase in the demand for wine, increasing price. 
B)  increase in the supply of wine, decreasing price. 
C)  decrease in the demand for wine, decreasing price. 
D)  decrease in the supply of wine, increasing price. 
A)  increase in the demand for wine, increasing price. 
B)  increase in the supply of wine, decreasing price. 
C)  decrease in the demand for wine, decreasing price. 
D)  decrease in the supply of wine, increasing price.

Exam 4: The Market Forces of Supply and Demand.

If the number of buyers in a market decreases,then

Holding all other things constant,a higher price for ski lift tickets would

In a market economy,

A surplus is the same as an excess demand.

When the price of hot dogs changes,the demand curve for hot dogs

The law of demand states that,other things equal,when the price of a good

The demand for a good or service is determined by

Figure 4-13 -Refer to Figure 4-13.The shift from S to S' in the market for peaches could be caused by a(n)

The market for ice cream is a

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

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?

Figure 4-13 -Refer to Figure 4-13.The shift from S' to S in the market for chocolate cake could be caused by a(n)

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

Which of the following events would cause the price of oranges to fall?

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

When quantity demanded has increased at every price,it might be because

Figure 4-19 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-19.All else equal,the premature deaths of thousands of turkeys would cause a move from

Public service announcements,mandatory health warnings on cigarette packages,and the prohibition of cigarette advertising on television are all policies aimed at shifting the demand curve for cigarettes to the right.

Figure 4-22 -Refer to Figure 4-22.Panel (d)shows which of the following?

An early frost in the vineyards of Napa Valley would cause a(n)

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 Market For the Factors of Production.

Earnings and Discrimination.

Income Inequality and Poverty.

The Theory of Consumer Choice.

Frontiers in Microeconomics.

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