Question 1

Which of the following results in an increase in the supply of a good or service?

Accepted Answer

A)  a fall in the price of the good or service 
B)  a smaller number of sellers producing the good or service 
C)  an increase in foreign imports of the good or service 
D)  higher taxes imposed upon producers of the good or service 
E)  a rise in the price of the good or service 
A)  a fall in the price of the good or service 
B)  a smaller number of sellers producing the good or service 
C)  an increase in foreign imports of the good or service 
D)  higher taxes imposed upon producers of the good or service 
E)  a rise in the price of the good or service

Question 2

When the price of rice rises,

Accepted Answer

A)  the market quantity supplied of rice increases. 
B)  the market supply of rice increases. 
C)  the market quantity of rice demanded decreases. 
D)  Both A and C are true. 
E)  Both A and B are true. 
A)  the market quantity supplied of rice increases. 
B)  the market supply of rice increases. 
C)  the market quantity of rice demanded decreases. 
D)  Both A and C are true. 
E)  Both A and B are true.

Question 3

It is expected that the price of a bushel of wheat will increase in one month.This belief will result in

Accepted Answer

A)  an increase in the current supply of wheat. 
B)  a decrease in the current supply of wheat. 
C)  a decrease in the future supply of wheat. 
D)  no change in the current or future supply of wheat. 
E)  an increase in the current quantity supplied of wheat. 
A)  an increase in the current supply of wheat. 
B)  a decrease in the current supply of wheat. 
C)  a decrease in the future supply of wheat. 
D)  no change in the current or future supply of wheat. 
E)  an increase in the current quantity supplied of wheat.

Question 4

"Other things remaining the same,if the price of a good rises,the quantity supplied of that good increases." This sentence describes a

Accepted Answer

A)  shift of a supply curve. 
B)  shift of the price curve. 
C)  movement along a supply curve. 
D)  movement along the price curve. 
E)  movement along the quantity curve. 
A)  shift of a supply curve. 
B)  shift of the price curve. 
C)  movement along a supply curve. 
D)  movement along the price curve. 
E)  movement along the quantity curve.

Question 5

$$\begin{array} { c c c } 
\begin{array} { c } 
\text { Price } \
\text { (dollars per gallon) }
\end{array} & \begin{array} { c } 
\text { Quantity demanded } \
\text { (gallons of gasoline) }
\end{array} & \begin{array} { c } 
\text { Quantity supplied } \
\text { (gallons of gasoline) }
\end{array} \
\hline 3.73 & 337,982 & 441,074 \
3.68 & 396,398 & 428,008 \
3.65 & 412,031 & 412,031 \
3.62 & 417,899 & 391,665 \
\hline
\end{array}$$
-The table above shows the situation in the gasoline market in Tulsa,Oklahoma.If the price of a gallon of gasoline is $3.62,then

Accepted Answer

A)  there is a surplus of gasoline in Tulsa. 
B)  there is a shortage of gasoline in Tulsa. 
C)  the gasoline market in Tulsa is in equilibrium. 
D)  Without more information we cannot determine if there is a surplus, a shortage, or an equilibrium in the gasoline market in Tulsa. 
E)  There is neither a surplus nor a shortage, but the market is  NOT  in equilibrium. 
A)  there is a surplus of gasoline in Tulsa. 
B)  there is a shortage of gasoline in Tulsa. 
C)  the gasoline market in Tulsa is in equilibrium. 
D)  Without more information we cannot determine if there is a surplus, a shortage, or an equilibrium in the gasoline market in Tulsa. 
E)  There is neither a surplus nor a shortage, but the market is  NOT  in equilibrium.

Question 6

-The above figure shows the market for pizza.The market is in equilibrium when people's incomes decrease.If pizza is a normal good,then which point represents the most likely new price and quantity?

Accepted Answer

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

Question 7

A decrease in the price of a complement in production leads to

Accepted Answer

A)  a decrease in the supply of the good in question. 
B)  an increase in the supply of the good in question. 
C)  no change in the supply of the good in question. 
D)  a decrease in the quantity supplied of the good in question. 
E)  an increase in the supply of the good in question and a decrease in the quantity supplied of the good in question. 
A)  a decrease in the supply of the good in question. 
B)  an increase in the supply of the good in question. 
C)  no change in the supply of the good in question. 
D)  a decrease in the quantity supplied of the good in question. 
E)  an increase in the supply of the good in question and a decrease in the quantity supplied of the good in question.

Question 8

In early 2012 the price of computer hard disc drives rose.In a demand and supply model,shifts in what curve or curves could have brought about the higher price?

Accepted Answer

The higher price could have been brought

Question 9

What is the law of demand?

Accepted Answer

The law of demand states that other thin

Question 10

$\begin{array}{c}
\quad\quad\quad\quad\quad\quad\quad\quad\quad\text { Quantity Demanded}\
\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\underline{\text {  (gallons of ice cream per year)} }\
\begin{array}{c}
\text { Price}\
\text { (dollars per gallon}\ 
\underline{\text { of ice cream)}}\
6\
5\
4\
3\
\end{array}
\begin{array}{lll}
\
\
\underline{\text {Katie }}\
3\
4\
6\
7
\end{array}
\begin{array}{c}
\
\
\underline{\text { Mark }} \
 5 \
7 \
9 \
10
\end{array}
\begin{array}{c}
\
\
\underline{\text { Bobby } }\
0 \
1 \
2 \
3
\end{array}
\end{array}$
-Suppose Katie,Mark,and Bobby are the only consumers in the market for ice cream.Using the demand schedules in the table above,what is the market demand curve for ice cream?

Accepted Answer

\[\begin{array} { c c } 
\begin{array} {

Question 11

Suppose the current price of a pound of steak is $12 per pound and the equilibrium price is $9 per pound.In this case,there is a

Accepted Answer

A)  shortage, so the price falls and quantity demanded increases. 
B)  surplus, so the price falls and quantity demanded increases. 
C)  shortage, so the price rises and quantity demanded decreases. 
D)  surplus, so the price rises and quantity demanded increases. 
E)  surplus, so the price falls and quantity supplied increases. 
A)  shortage, so the price falls and quantity demanded increases. 
B)  surplus, so the price falls and quantity demanded increases. 
C)  shortage, so the price rises and quantity demanded decreases. 
D)  surplus, so the price rises and quantity demanded increases. 
E)  surplus, so the price falls and quantity supplied increases.

Question 12

$$\begin{array} { c c c } 
\begin{array} { c } 
\text { Quantity demanded } \
\text { (tons of cat food per year) }
\end{array} & \begin{array} { c } 
\text { Price } \
\text { (dollars per pound of cat } \
\text { food) }
\end{array} & \begin{array} { c } 
\text { Quantity supplied } \
\text { (tons of cat food per year) }
\end{array} \
\hline 52 & 1.00 & 15 \
46 & 1.50 & 26 \
43 & 2.00 & 34 \
40 & 2.50 & 40 \
35 & 3.00 & 44 \
\hline
\end{array}$$
-The above table gives the demand and supply schedules for cat food.If the supply increases by 20 tons at every price,what is the new equilibrium price and quantity?

Accepted Answer

The equilibrium price is $1.50 per pound

Question 13

-Soda and peanuts are complements.Other influences on buying plans remaining the same,a rise in the price of soda

Accepted Answer

A)  increases the demand for peanuts. 
B)  decreases the demand for peanuts. 
C)  decreases the demand for soda. 
D)  increases the demand for soda. 
E)  has no effect on the demand for peanuts, though it does change the quantity demanded of peanuts. 
A)  increases the demand for peanuts. 
B)  decreases the demand for peanuts. 
C)  decreases the demand for soda. 
D)  increases the demand for soda. 
E)  has no effect on the demand for peanuts, though it does change the quantity demanded of peanuts.

Question 14

-The above figures show the market for HD televisions.If cable television providers lower the price of providing HD cable service,which figure shows the effect of this change?

Accepted Answer

A)  Figure A 
B)  Figure B 
C)  Figure C 
D)  Figure D 
E)  None of the figures represent this change. 
A)  Figure A 
B)  Figure B 
C)  Figure C 
D)  Figure D 
E)  None of the figures represent this change.

Question 15

Which of the following is the best explanation for why the price of gasoline increases during the summer months?

Accepted Answer

A)  Oil producers have higher costs of production in the summer. 
B)  Sellers have to earn profits during the summer to cover losses in the winter. 
C)  There is increased driving by families going on vacation. 
D)  There is less competition among oil refineries in the summer. 
E)  The number of gas stations open 24 hours a day rises in the summer months and so the price must rise to cover the higher costs. 
A)  Oil producers have higher costs of production in the summer. 
B)  Sellers have to earn profits during the summer to cover losses in the winter. 
C)  There is increased driving by families going on vacation. 
D)  There is less competition among oil refineries in the summer. 
E)  The number of gas stations open 24 hours a day rises in the summer months and so the price must rise to cover the higher costs.

Question 16

-In the above figure,the shift in the demand curve from D to D₁ can be the result of

Accepted Answer

A)  an increase in the price of pizza. 
B)  an increase in the price of a sub sandwich, a substitute for pizza. 
C)  an increase in the price of soda, a complement to pizza. 
D)  a change in quantity demanded. 
E)  a decrease in income if pizza is a normal good. 
A)  an increase in the price of pizza. 
B)  an increase in the price of a sub sandwich, a substitute for pizza. 
C)  an increase in the price of soda, a complement to pizza. 
D)  a change in quantity demanded. 
E)  a decrease in income if pizza is a normal good.

Question 17

The technology associated with manufacturing computers has advanced enormously.This change has led to the price of a computer ________ and the quantity ________.

Accepted Answer

A)  rising; increasing 
B)  rising; decreasing 
C)  falling; increasing 
D)  falling; decreasing 
E)  falling; not changing 
A)  rising; increasing 
B)  rising; decreasing 
C)  falling; increasing 
D)  falling; decreasing 
E)  falling; not changing

Question 18

The law of demand implies that,other things remaining the same,

Accepted Answer

A)  as the price of a cheeseburger rises, the quantity of cheeseburgers demanded increases. 
B)  as the price of a cheeseburger rises, the quantity of cheeseburgers demanded decreases. 
C)  as income increases, the quantity of cheeseburgers demanded increases. 
D)  as the demand for cheeseburgers increases, the price of a cheeseburger falls. 
E)  as more people demand cheeseburgers, the quantity demanded increases. 
A)  as the price of a cheeseburger rises, the quantity of cheeseburgers demanded increases. 
B)  as the price of a cheeseburger rises, the quantity of cheeseburgers demanded decreases. 
C)  as income increases, the quantity of cheeseburgers demanded increases. 
D)  as the demand for cheeseburgers increases, the price of a cheeseburger falls. 
E)  as more people demand cheeseburgers, the quantity demanded increases.

Question 19

-The graph illustrates the market for bottled water.If the producers of bottled water switch to using improved technology,then the

Accepted Answer

A)  supply of bottled water decreases. 
B)  quantity demanded of bottled water increases. 
C)  quantity demanded of bottled water does not change. 
D)  price of bottled water rises. 
E)  supply curve shifts leftward. 
A)  supply of bottled water decreases. 
B)  quantity demanded of bottled water increases. 
C)  quantity demanded of bottled water does not change. 
D)  price of bottled water rises. 
E)  supply curve shifts leftward.

Question 20

Hot dogs and hot dog buns are complements.If the price of a hot dog falls,then

Accepted Answer

A)  the demand for hot dogs will increase. 
B)  the demand for hot dog buns will decrease. 
C)  the quantity demanded of hotdogs will decrease. 
D)  the demand for hot dog buns will increase. 
E)  the quantity demanded of hot dog buns will increase. 
A)  the demand for hot dogs will increase. 
B)  the demand for hot dog buns will decrease. 
C)  the quantity demanded of hotdogs will decrease. 
D)  the demand for hot dog buns will increase. 
E)  the quantity demanded of hot dog buns will increase.

Which of the following results in an increase in the supply of a good or service?

When the price of rice rises,

It is expected that the price of a bushel of wheat will increase in one month.This belief will result in

"Other things remaining the same,if the price of a good rises,the quantity supplied of that good increases." This sentence describes a

-The above figure shows the market for pizza.The market is in equilibrium when people's incomes decrease.If pizza is a normal good,then which point represents the most likely new price and quantity?

A decrease in the price of a complement in production leads to

In early 2012 the price of computer hard disc drives rose.In a demand and supply model,shifts in what curve or curves could have brought about the higher price?

What is the law of demand?

Quantity Demanded Price (dollars per gallon 6 5 4 3 3 4 6 7 5 7 9 10 0 1 2 3 -Suppose Katie,Mark,and Bobby are the only consumers in the market for ice cream.Using the demand schedules in the table above,what is the market demand curve for ice cream?

Suppose the current price of a pound of steak is $12 per pound and the equilibrium price is $9 per pound.In this case,there is a

-Soda and peanuts are complements.Other influences on buying plans remaining the same,a rise in the price of soda

-The above figures show the market for HD televisions.If cable television providers lower the price of providing HD cable service,which figure shows the effect of this change?

Which of the following is the best explanation for why the price of gasoline increases during the summer months?

-In the above figure,the shift in the demand curve from D to D₁ can be the result of

The technology associated with manufacturing computers has advanced enormously.This change has led to the price of a computer and the quantity .

The law of demand implies that,other things remaining the same,

-The graph illustrates the market for bottled water.If the producers of bottled water switch to using improved technology,then the

Hot dogs and hot dog buns are complements.If the price of a hot dog falls,then

Getting Started

The U.S.and Global Economies

The Economic Problem

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets with Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

Exam 4: Demand and Supply

Which of the following results in an increase in the supply of a good or service?

When the price of rice rises,

It is expected that the price of a bushel of wheat will increase in one month.This belief will result in

"Other things remaining the same,if the price of a good rises,the quantity supplied of that good increases." This sentence describes a

-The above figure shows the market for pizza.The market is in equilibrium when people's incomes decrease.If pizza is a normal good,then which point represents the most likely new price and quantity?

A decrease in the price of a complement in production leads to

In early 2012 the price of computer hard disc drives rose.In a demand and supply model,shifts in what curve or curves could have brought about the higher price?

What is the law of demand?

Quantity Demanded Price (dollars per gallon 6 5 4 3 3 4 6 7 5 7 9 10 0 1 2 3 -Suppose Katie,Mark,and Bobby are the only consumers in the market for ice cream.Using the demand schedules in the table above,what is the market demand curve for ice cream?

Suppose the current price of a pound of steak is $12 per pound and the equilibrium price is $9 per pound.In this case,there is a

-Soda and peanuts are complements.Other influences on buying plans remaining the same,a rise in the price of soda

-The above figures show the market for HD televisions.If cable television providers lower the price of providing HD cable service,which figure shows the effect of this change?

Which of the following is the best explanation for why the price of gasoline increases during the summer months?

-In the above figure,the shift in the demand curve from D to D₁ can be the result of

The technology associated with manufacturing computers has advanced enormously.This change has led to the price of a computer ________ and the quantity ________.

The law of demand implies that,other things remaining the same,

-The graph illustrates the market for bottled water.If the producers of bottled water switch to using improved technology,then the

Hot dogs and hot dog buns are complements.If the price of a hot dog falls,then

Getting Started

The U.S.and Global Economies

The Economic Problem

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets with Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

The technology associated with manufacturing computers has advanced enormously.This change has led to the price of a computer and the quantity .