Question 1

List the factors that change demand and shift the demand curve.Tell what happens to demand and the demand curve when there is an increase in the factor.

Accepted Answer

One factor that changes demand is a chan

Question 2

Suppose that the price of flour used to produce bagels increases.Hence the equilibrium price of a bagel ________,and the equilibrium quantity ________.

Accepted Answer

A)  rises; increases 
B)  rises; decreases 
C)  falls; increases 
D)  falls; decreases 
E)  does not change; does not change 
A)  rises; increases 
B)  rises; decreases 
C)  falls; increases 
D)  falls; decreases 
E)  does not change; does not change

Question 3

Wheat is used to produce cereal.When the price of wheat falls,the

Accepted Answer

A)  demand for wheat increases. 
B)  supply of wheat decreases. 
C)  supply of cereal increases. 
D)  demand for cereal increases. 
E)  demand for cereal decreases. 
A)  demand for wheat increases. 
B)  supply of wheat decreases. 
C)  supply of cereal increases. 
D)  demand for cereal increases. 
E)  demand for cereal decreases.

Question 4

If a market begins in equilibrium and then the demand curve shifts leftward,a

Accepted Answer

A)  shortage is created, which is eliminated by a fall in price. 
B)  shortage is created, which is eliminated by a rise in price. 
C)  surplus is created, which is eliminated by a fall in price. 
D)  surplus is created, which is eliminated by a rise in price. 
E)  surplus is created, which is eliminated by the supply curve shifting leftward. 
A)  shortage is created, which is eliminated by a fall in price. 
B)  shortage is created, which is eliminated by a rise in price. 
C)  surplus is created, which is eliminated by a fall in price. 
D)  surplus is created, which is eliminated by a rise in price. 
E)  surplus is created, which is eliminated by the supply curve shifting leftward.

Question 5

If macaroni and cheese is an inferior good,then a decrease in income results in

Accepted Answer

A)  an increase in the demand for macaroni and cheese. 
B)  a decrease in the demand for macaroni and cheese. 
C)  an increase in the supply of macaroni and cheese. 
D)  a decrease in the supply of macaroni and cheese. 
E)  Both answers A and D are correct. 
A)  an increase in the demand for macaroni and cheese. 
B)  a decrease in the demand for macaroni and cheese. 
C)  an increase in the supply of macaroni and cheese. 
D)  a decrease in the supply of macaroni and cheese. 
E)  Both answers A and D are correct.

Question 6

Suppose the government imposes a small carbon tax on automakers.But the price of gasoline has doubled due to a Middle East crisis which has reduced oil production.In the market for autos,these changes mean that supply and demand have both changed with the effect on the demand larger than the effect on the supply.The result is that the price of autos will ________ and the number of autos sold will ________.

Accepted Answer

A)  rise; perhaps change but we can't say if it increases, decreases, or stays the same 
B)  rise; increase 
C)  rise; decrease 
D)  fall; perhaps change but we can't say if it increases, decreases, or stays the same 
E)  fall; decrease 
A)  rise; perhaps change but we can't say if it increases, decreases, or stays the same 
B)  rise; increase 
C)  rise; decrease 
D)  fall; perhaps change but we can't say if it increases, decreases, or stays the same 
E)  fall; decrease

Question 7

-The graph illustrates the demand for peanuts.Peanuts are a normal good because the

Accepted Answer

A)  demand curve for peanuts slopes downward. 
B)  demand for peanuts increases when income increases. 
C)  demand for peanuts increases when the price of one of its substitutes rises. 
D)  peanuts have both substitutes and complements. 
E)  demand curve shows that if the price of peanuts rises, there is a movement along the demand curve to a lower quantity demanded. 
A)  demand curve for peanuts slopes downward. 
B)  demand for peanuts increases when income increases. 
C)  demand for peanuts increases when the price of one of its substitutes rises. 
D)  peanuts have both substitutes and complements. 
E)  demand curve shows that if the price of peanuts rises, there is a movement along the demand curve to a lower quantity demanded.

Question 8

A huge 50 percent off sale on golf clubs is advertised for next week.What happens this week in the market for golf clubs?

Accepted Answer

A)  The supply of golf clubs increases. 
B)  The supply of golf clubs decreases. 
C)  The demand for golf clubs increases. 
D)  The demand for golf clubs decreases. 
E)  The demand for and the supply of golf clubs decreases. 
A)  The supply of golf clubs increases. 
B)  The supply of golf clubs decreases. 
C)  The demand for golf clubs increases. 
D)  The demand for golf clubs decreases. 
E)  The demand for and the supply of golf clubs decreases.

Question 9

-In the figure above,a price of $15 per dozen roses results in

Accepted Answer

A)  equilibrium. 
B)  a shortage. 
C)  a surplus. 
D)  downward pressure on the price of roses. 
E)  an eventual leftward shift of the demand curve and/or rightward shift of the supply curve. 
A)  equilibrium. 
B)  a shortage. 
C)  a surplus. 
D)  downward pressure on the price of roses. 
E)  an eventual leftward shift of the demand curve and/or rightward shift of the supply curve.

Question 10

If the costs of producing pizza increase,which will occur?

Accepted Answer

A)  The supply of pizza will decrease. 
B)  The quantity of pizzas supplied will increase as sellers try to cover their costs. 
C)  Pizza will cease to be produced and sold. 
D)  The demand curve for pizza will shift leftward when the price of a pizza increases. 
E)  The demand curve for pizza will shift rightward when the price of a pizza increases. 
A)  The supply of pizza will decrease. 
B)  The quantity of pizzas supplied will increase as sellers try to cover their costs. 
C)  Pizza will cease to be produced and sold. 
D)  The demand curve for pizza will shift leftward when the price of a pizza increases. 
E)  The demand curve for pizza will shift rightward when the price of a pizza increases.

Question 11

Consider the market for turkeys.In the United States,because of Thanksgiving in the month of November,

Accepted Answer

A)  there is a downward movement along the demand curve for turkeys. 
B)  there is an upward movement along the supply curve for turkeys. 
C)  the supply curve of turkeys shifts leftward. 
D)  the demand curve for turkeys shifts leftward. 
E)  neither the demand curve nor the supply curve shift; instead there is a movement along both curves. 
A)  there is a downward movement along the demand curve for turkeys. 
B)  there is an upward movement along the supply curve for turkeys. 
C)  the supply curve of turkeys shifts leftward. 
D)  the demand curve for turkeys shifts leftward. 
E)  neither the demand curve nor the supply curve shift; instead there is a movement along both curves.

Question 12

To find the market demand curve for in-line skates,we must

Accepted Answer

A)  add the quantities demanded at every price and every income by every buyer of in-line skates. 
B)  add the quantities demanded at prices that all buyers can afford to pay. 
C)  sum horizontally the individual demand curves of all the buyers. 
D)  take account of the skate buying plans of all actual and potential buyers in all possible situations. 
E)  None of the above answers is correct because we need also to take account of the supply of in-line skates. 
A)  add the quantities demanded at every price and every income by every buyer of in-line skates. 
B)  add the quantities demanded at prices that all buyers can afford to pay. 
C)  sum horizontally the individual demand curves of all the buyers. 
D)  take account of the skate buying plans of all actual and potential buyers in all possible situations. 
E)  None of the above answers is correct because we need also to take account of the supply of in-line skates.

Question 13

When the demand curve shifts rightward and the market moves to a new equilibrium,then the

Accepted Answer

A)  supply increases. 
B)  supply decreases. 
C)  quantity supplied increases. 
D)  quantity supplied decreases. 
E)  price falls to restore the equilibrium. 
A)  supply increases. 
B)  supply decreases. 
C)  quantity supplied increases. 
D)  quantity supplied decreases. 
E)  price falls to restore the equilibrium.

Question 14

The equilibrium price of a good occurs if the

Accepted Answer

A)  quantity of the good demanded equals the quantity of the good supplied. 
B)  quantity of the good demanded is greater than the quantity of the good supplied. 
C)  quantity of the good demanded is less than the quantity of the good supplied. 
D)  demand for the good is equal to the supply of the good. 
E)  price of the good seems reasonable to most buyers. 
A)  quantity of the good demanded equals the quantity of the good supplied. 
B)  quantity of the good demanded is greater than the quantity of the good supplied. 
C)  quantity of the good demanded is less than the quantity of the good supplied. 
D)  demand for the good is equal to the supply of the good. 
E)  price of the good seems reasonable to most buyers.

Question 15

Which of the following shifts the supply curve of rutabagas rightward? (A rutabaga is a potato-like vegetable.)

Accepted Answer

A)  an increase in the price of a rutabaga 
B)  an exceptionally cold summer that killed much of the rutabaga crop 
C)  a fall in the price of fertilizer used to grow rutabagas 
D)  Both answers A and C shift the supply curve of rutabagas rightward. 
E)  Both answers A and B shift the supply curve of rutabagas rightward. 
A)  an increase in the price of a rutabaga 
B)  an exceptionally cold summer that killed much of the rutabaga crop 
C)  a fall in the price of fertilizer used to grow rutabagas 
D)  Both answers A and C shift the supply curve of rutabagas rightward. 
E)  Both answers A and B shift the supply curve of rutabagas rightward.

Question 16

-Scooters and bicycles are substitutes.Suppose that the price of a bicycle falls.Which of the figures above best illustrates how this fall in price affects the demand curve for scooters?

Accepted Answer

A)  Figure A 
B)  Figure B 
C)  Figure C 
D)  Figure D 
E)  None of the above answers is correct because the change in the price of a bicycle will affect the supply curve not the demand curve. 
A)  Figure A 
B)  Figure B 
C)  Figure C 
D)  Figure D 
E)  None of the above answers is correct because the change in the price of a bicycle will affect the supply curve not the demand curve.

Question 17

If the number of sellers decreases,then the supply curve ________ and the supply ________.

Accepted Answer

A)  shifts rightward; increases 
B)  shifts rightward; decreases 
C)  shifts leftward; increases 
D)  shifts leftward; decreases 
E)  does not shift; does not change, but there is a decrease in the quantity supplied 
A)  shifts rightward; increases 
B)  shifts rightward; decreases 
C)  shifts leftward; increases 
D)  shifts leftward; decreases 
E)  does not shift; does not change, but there is a decrease in the quantity supplied

Question 18

Teenagers drink more soda than other age groups.If the number of teenagers increases,everything else remaining the same,

Accepted Answer

A)  market demand for soda increases. 
B)  market demand for soda decreases. 
C)  market demand for soda does not change. 
D)  there is a movement along the market demand curve for soda. 
E)  None of the above answers is correct because the effect on the demand depends whether the supply curve shifts rightward, leftward, or not at all. 
A)  market demand for soda increases. 
B)  market demand for soda decreases. 
C)  market demand for soda does not change. 
D)  there is a movement along the market demand curve for soda. 
E)  None of the above answers is correct because the effect on the demand depends whether the supply curve shifts rightward, leftward, or not at all.

Question 19

Mulch is shredded wood and is a by-product in the production of lumber.Because these two goods are produced together,they are

Accepted Answer

A)  complements in production. 
B)  substitutes in production. 
C)  inputs into the same production process. 
D)  not related. 
E)  normal goods in production. 
A)  complements in production. 
B)  substitutes in production. 
C)  inputs into the same production process. 
D)  not related. 
E)  normal goods in production.

Question 20

Which of the following shifts the supply curve for oranges?

Accepted Answer

A)  disastrous weather that destroys about half of this year's orange crop 
B)  a newly discovered increase in the nutritional value of oranges 
C)  an increase in the price of bananas, a substitute in consumption for oranges 
D)  an increase in income for all orange consumers if oranges are a normal good 
E)  an increase in the number of orange consumers 
A)  disastrous weather that destroys about half of this year's orange crop 
B)  a newly discovered increase in the nutritional value of oranges 
C)  an increase in the price of bananas, a substitute in consumption for oranges 
D)  an increase in income for all orange consumers if oranges are a normal good 
E)  an increase in the number of orange consumers

List the factors that change demand and shift the demand curve.Tell what happens to demand and the demand curve when there is an increase in the factor.

Suppose that the price of flour used to produce bagels increases.Hence the equilibrium price of a bagel ,and the equilibrium quantity .

Wheat is used to produce cereal.When the price of wheat falls,the

If a market begins in equilibrium and then the demand curve shifts leftward,a

If macaroni and cheese is an inferior good,then a decrease in income results in

-The graph illustrates the demand for peanuts.Peanuts are a normal good because the

A huge 50 percent off sale on golf clubs is advertised for next week.What happens this week in the market for golf clubs?

-In the figure above,a price of $15 per dozen roses results in

If the costs of producing pizza increase,which will occur?

Consider the market for turkeys.In the United States,because of Thanksgiving in the month of November,

To find the market demand curve for in-line skates,we must

When the demand curve shifts rightward and the market moves to a new equilibrium,then the

The equilibrium price of a good occurs if the

Which of the following shifts the supply curve of rutabagas rightward? (A rutabaga is a potato-like vegetable.)

-Scooters and bicycles are substitutes.Suppose that the price of a bicycle falls.Which of the figures above best illustrates how this fall in price affects the demand curve for scooters?

If the number of sellers decreases,then the supply curve and the supply .

Teenagers drink more soda than other age groups.If the number of teenagers increases,everything else remaining the same,

Mulch is shredded wood and is a by-product in the production of lumber.Because these two goods are produced together,they are

Which of the following shifts the supply curve for oranges?

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

List the factors that change demand and shift the demand curve.Tell what happens to demand and the demand curve when there is an increase in the factor.

Suppose that the price of flour used to produce bagels increases.Hence the equilibrium price of a bagel ________,and the equilibrium quantity ________.

Wheat is used to produce cereal.When the price of wheat falls,the

If a market begins in equilibrium and then the demand curve shifts leftward,a

If macaroni and cheese is an inferior good,then a decrease in income results in

-The graph illustrates the demand for peanuts.Peanuts are a normal good because the

A huge 50 percent off sale on golf clubs is advertised for next week.What happens this week in the market for golf clubs?

-In the figure above,a price of $15 per dozen roses results in

If the costs of producing pizza increase,which will occur?

Consider the market for turkeys.In the United States,because of Thanksgiving in the month of November,

To find the market demand curve for in-line skates,we must

When the demand curve shifts rightward and the market moves to a new equilibrium,then the

The equilibrium price of a good occurs if the

Which of the following shifts the supply curve of rutabagas rightward? (A rutabaga is a potato-like vegetable.)

-Scooters and bicycles are substitutes.Suppose that the price of a bicycle falls.Which of the figures above best illustrates how this fall in price affects the demand curve for scooters?

If the number of sellers decreases,then the supply curve ________ and the supply ________.

Teenagers drink more soda than other age groups.If the number of teenagers increases,everything else remaining the same,

Mulch is shredded wood and is a by-product in the production of lumber.Because these two goods are produced together,they are

Which of the following shifts the supply curve for oranges?

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

Suppose that the price of flour used to produce bagels increases.Hence the equilibrium price of a bagel ,and the equilibrium quantity .

If the number of sellers decreases,then the supply curve and the supply .