Question 1

Which of the following concepts best describes why a consumer's willingness to pay for a good decreases as the quantity consumed increases?

Accepted Answer

A)  diminishing marginal utility 
B)  increasing additional cost 
C)  constant marginal benefit 
D)  decreasing additional cost 
A)  diminishing marginal utility 
B)  increasing additional cost 
C)  constant marginal benefit 
D)  decreasing additional cost

Question 2

Consumers consider that good A and good B are substitutable in consumption. When the price of good A decreases, there is an expectation that there is _____ in quantity of good A demanded and _____ in the demand for good

Accepted Answer

A)  an increase; an increase 
B)  an increase; a decrease 
C)  a decrease; an increase 
D)  a decrease; a decrease 
A)  an increase; an increase 
B)  an increase; a decrease 
C)  a decrease; an increase 
D)  a decrease; a decrease

Question 3

What is measured on the vertical axis of a demand graph?

Accepted Answer

A)  price 
B)  quantity 
C)  utility 
D)  satisfaction 
A)  price 
B)  quantity 
C)  utility 
D)  satisfaction

Question 4

Use Table: Individual Demand Schedules for Pairs of Socks. What is the increase in the market demand if the price of a pair of socks falls from $4 to $3?
​

Accepted Answer

A)  10 
B)  11 
C)  two 
D)  one 
A)  10 
B)  11 
C)  two 
D)  one

Question 5

If gasoline is a normal good and all else is equal, when average consumer income falls, the demand curve for gasoline will:

Accepted Answer

A)  shift to the right. 
B)  shift to the left. 
C)  see a movement upward to the left along the curve. 
D)  see a movement downward to the right along the curve. 
A)  shift to the right. 
B)  shift to the left. 
C)  see a movement upward to the left along the curve. 
D)  see a movement downward to the right along the curve.

Question 6

Use Figure: The Market Demand for Canoes. How much consumer surplus will be lost of the price increases by $5?
​
Figure: The Market Demand for Canoes

Accepted Answer

A)  $5 
B)  $10 
C)  $20 
D)  $25 
A)  $5 
B)  $10 
C)  $20 
D)  $25

Question 7

Use Table: Individual Demand Schedules for Pairs of Socks. If the price of a pair of socks is $5, how much total consumer surplus will exist in the market?
​

Accepted Answer

A)  $19 
B)  $10 
C)  $5 
D)  $40 
A)  $19 
B)  $10 
C)  $5 
D)  $40

Question 8

Refer to the table Amelie's Demand for Running Shoes. What is Amelie's consumer surplus at the quantity she would be willing to buy at a price of $70?
​

Accepted Answer

A)  $5 
B)  $25 
C)  $70 
D)  $75 
A)  $5 
B)  $25 
C)  $70 
D)  $75

Question 9

Netta considers apples and oranges complements. All else equal, what will happen to Netta's demand for oranges when the price of apples increases?

Accepted Answer

A)  The demand for oranges will shift to the right. 
B)  The quantity demanded of oranges will increase. 
C)  The demand for oranges will shift to the left. 
D)  The demand for oranges will not be affected. 
A)  The demand for oranges will shift to the right. 
B)  The quantity demanded of oranges will increase. 
C)  The demand for oranges will shift to the left. 
D)  The demand for oranges will not be affected.

Question 10

Use Table: Individual Demand Schedules for Pairs of Socks. If the price of a pair of socks rises from $6 to $7, by how much did total consumer surplus change in the market?
​

Accepted Answer

A)  Consumer surplus did not change. 
B)  Consumer surplus increased by $2. 
C)  Consumer surplus decreased by $1. 
D)  Consumer surplus decreased by $5. 
A)  Consumer surplus did not change. 
B)  Consumer surplus increased by $2. 
C)  Consumer surplus decreased by $1. 
D)  Consumer surplus decreased by $5.

Question 11

Jia expects that her income is going to go down in the future. All else equal, how will this impact her demand for beets, an inferior good, today?

Accepted Answer

A)  Her demand today decreases. 
B)  Her quantity demanded today increases. 
C)  Her demand today isn't affected. 
D)  Her demand today increases. 
A)  Her demand today decreases. 
B)  Her quantity demanded today increases. 
C)  Her demand today isn't affected. 
D)  Her demand today increases.

Question 12

If tacos are a normal good and all else is equal, when average consumer income rises, the demand curve for tacos will:

Accepted Answer

A)  increase. 
B)  decrease. 
C)  remain unchanged. 
D)  see a movement downward along the curve. 
A)  increase. 
B)  decrease. 
C)  remain unchanged. 
D)  see a movement downward along the curve.

Question 13

Use Table: Individual Demand Schedules for Pairs of Socks. If the price of a pair of socks is $8, how much consumer surplus will Daphne enjoy?
​

Accepted Answer

A)  $8 
B)  zero 
C)  $24 
D)  $3 
A)  $8 
B)  zero 
C)  $24 
D)  $3

Question 14

The downward slope of the demand curve results from:

Accepted Answer

A)  increasing opportunity cost. 
B)  diminishing marginal utility. 
C)  increasing marginal product of labor. 
D)  increasing marginal utility. 
A)  increasing opportunity cost. 
B)  diminishing marginal utility. 
C)  increasing marginal product of labor. 
D)  increasing marginal utility.

Question 15

Use Table: Individual Demand Schedules for Pairs of Socks. If the price of a pair of socks rises from $6 to $7, by how much did Niles's consumer surplus change?
​

Accepted Answer

A)  Niles's consumer surplus did not change. 
B)  Niles's consumer surplus increased by $2. 
C)  Niles's consumer surplus decreased by $1. 
D)  Niles's consumer surplus decreased by $2. 
A)  Niles's consumer surplus did not change. 
B)  Niles's consumer surplus increased by $2. 
C)  Niles's consumer surplus decreased by $1. 
D)  Niles's consumer surplus decreased by $2.

Question 16

If chips and pretzels are substitutes, then when the price of chips decreases, the quantity demanded of chips _____, and the demand for pretzels _____.

Accepted Answer

A)  decreases; decreases 
B)  decreases; increases 
C)  increases; increases 
D)  increases; decreases 
A)  decreases; decreases 
B)  decreases; increases 
C)  increases; increases 
D)  increases; decreases

Question 17

Naren buys gallons of both milk and orange juice. Whenever the grocery store lowers the price of milk, he purchases more gallons of milk and fewer gallons of orange juice. All else equal, does Naren consider milk and orange juice to be substitutes in consumption, complements in consumption, or unrelated goods? Explain.

Accepted Answer

Naren considers these goods to be substi

Question 18

When the price of ice cream cones is $2 per cone, Celine buys three cones in a month. Which of the following describes a downward movement along Celine's monthly demand for ice cream cones?

Accepted Answer

A)  When the price of ice cream cones is $1, she will buy four cones per month. 
B)  When the price of ice cream cones is $2, she will buy two cones per month. 
C)  When the price of ice cream cones is $3, she will buy two cones per month. 
D)  When the price of ice cream cones is $2, she will buy four cones per month. 
A)  When the price of ice cream cones is $1, she will buy four cones per month. 
B)  When the price of ice cream cones is $2, she will buy two cones per month. 
C)  When the price of ice cream cones is $3, she will buy two cones per month. 
D)  When the price of ice cream cones is $2, she will buy four cones per month.

Question 19

Consumers consider that good A and good B are substitutable in consumption. When the price of good A increases, there is an expectation that there is _____ in quantity of good A demanded and _____ in the demand for good

Accepted Answer

A)  an increase; an increase 
B)  an increase; a decrease 
C)  a decrease; an increase 
D)  a decrease; a decrease 
A)  an increase; an increase 
B)  an increase; a decrease 
C)  a decrease; an increase 
D)  a decrease; a decrease

Question 20

Use Table: Individual Demand Schedules for Pairs of Socks. If the price of a pair of socks is $8, how much consumer surplus will Niles enjoy?
​

Accepted Answer

A)  $7 
B)  zero 
C)  $1 
D)  $14 
A)  $7 
B)  zero 
C)  $1 
D)  $14

Which of the following concepts best describes why a consumer's willingness to pay for a good decreases as the quantity consumed increases?

Consumers consider that good A and good B are substitutable in consumption. When the price of good A decreases, there is an expectation that there is _ in quantity of good A demanded and _ in the demand for good

What is measured on the vertical axis of a demand graph?

Use Table: Individual Demand Schedules for Pairs of Socks. What is the increase in the market demand if the price of a pair of socks falls from $4 to $3?

If gasoline is a normal good and all else is equal, when average consumer income falls, the demand curve for gasoline will:

Use Figure: The Market Demand for Canoes. How much consumer surplus will be lost of the price increases by $5? Figure: The Market Demand for Canoes

Use Table: Individual Demand Schedules for Pairs of Socks. If the price of a pair of socks is $5, how much total consumer surplus will exist in the market?

Refer to the table Amelie's Demand for Running Shoes. What is Amelie's consumer surplus at the quantity she would be willing to buy at a price of $70?

Netta considers apples and oranges complements. All else equal, what will happen to Netta's demand for oranges when the price of apples increases?

Use Table: Individual Demand Schedules for Pairs of Socks. If the price of a pair of socks rises from $6 to $7, by how much did total consumer surplus change in the market?

Jia expects that her income is going to go down in the future. All else equal, how will this impact her demand for beets, an inferior good, today?

If tacos are a normal good and all else is equal, when average consumer income rises, the demand curve for tacos will:

Use Table: Individual Demand Schedules for Pairs of Socks. If the price of a pair of socks is $8, how much consumer surplus will Daphne enjoy?

The downward slope of the demand curve results from:

Use Table: Individual Demand Schedules for Pairs of Socks. If the price of a pair of socks rises from $6 to $7, by how much did Niles's consumer surplus change?

If chips and pretzels are substitutes, then when the price of chips decreases, the quantity demanded of chips _, and the demand for pretzels _.

When the price of ice cream cones is $2 per cone, Celine buys three cones in a month. Which of the following describes a downward movement along Celine's monthly demand for ice cream cones?

Consumers consider that good A and good B are substitutable in consumption. When the price of good A increases, there is an expectation that there is _ in quantity of good A demanded and _ in the demand for good

Use Table: Individual Demand Schedules for Pairs of Socks. If the price of a pair of socks is $8, how much consumer surplus will Niles enjoy?

Foundations of Economics

Extension: Understanding Graphs

Markets and Economies

Supply

Market Equilibrium

Elasticity

Consumer Behavior

Production Costs

Perfect Competition

Market Power

Factor Markets

Market Failure and Government Failure

Measuring an Economys Performance

Aggregate Demand and Aggregate Supply

Fiscal Policy

Money and Banking

Monetary Policy

Economic Growth and Development

International Trade and Finance

Filters

Exam 3: Demand

Which of the following concepts best describes why a consumer's willingness to pay for a good decreases as the quantity consumed increases?

Consumers consider that good A and good B are substitutable in consumption. When the price of good A decreases, there is an expectation that there is _____ in quantity of good A demanded and _____ in the demand for good

What is measured on the vertical axis of a demand graph?

Use Table: Individual Demand Schedules for Pairs of Socks. What is the increase in the market demand if the price of a pair of socks falls from $4 to $3? ​

If gasoline is a normal good and all else is equal, when average consumer income falls, the demand curve for gasoline will:

Use Figure: The Market Demand for Canoes. How much consumer surplus will be lost of the price increases by $5? ​ Figure: The Market Demand for Canoes

Use Table: Individual Demand Schedules for Pairs of Socks. If the price of a pair of socks is $5, how much total consumer surplus will exist in the market? ​

Refer to the table Amelie's Demand for Running Shoes. What is Amelie's consumer surplus at the quantity she would be willing to buy at a price of $70? ​

Netta considers apples and oranges complements. All else equal, what will happen to Netta's demand for oranges when the price of apples increases?

Use Table: Individual Demand Schedules for Pairs of Socks. If the price of a pair of socks rises from $6 to $7, by how much did total consumer surplus change in the market? ​

Jia expects that her income is going to go down in the future. All else equal, how will this impact her demand for beets, an inferior good, today?

If tacos are a normal good and all else is equal, when average consumer income rises, the demand curve for tacos will:

Use Table: Individual Demand Schedules for Pairs of Socks. If the price of a pair of socks is $8, how much consumer surplus will Daphne enjoy? ​

The downward slope of the demand curve results from:

Use Table: Individual Demand Schedules for Pairs of Socks. If the price of a pair of socks rises from $6 to $7, by how much did Niles's consumer surplus change? ​

If chips and pretzels are substitutes, then when the price of chips decreases, the quantity demanded of chips _____, and the demand for pretzels _____.

When the price of ice cream cones is $2 per cone, Celine buys three cones in a month. Which of the following describes a downward movement along Celine's monthly demand for ice cream cones?

Consumers consider that good A and good B are substitutable in consumption. When the price of good A increases, there is an expectation that there is _____ in quantity of good A demanded and _____ in the demand for good

Use Table: Individual Demand Schedules for Pairs of Socks. If the price of a pair of socks is $8, how much consumer surplus will Niles enjoy? ​

Foundations of Economics

Extension: Understanding Graphs

Markets and Economies

Supply

Market Equilibrium

Elasticity

Consumer Behavior

Production Costs

Perfect Competition

Market Power

Factor Markets

Market Failure and Government Failure

Measuring an Economys Performance

Aggregate Demand and Aggregate Supply

Fiscal Policy

Money and Banking

Monetary Policy

Economic Growth and Development

International Trade and Finance

Filters

Consumers consider that good A and good B are substitutable in consumption. When the price of good A decreases, there is an expectation that there is _ in quantity of good A demanded and _ in the demand for good

Use Table: Individual Demand Schedules for Pairs of Socks. What is the increase in the market demand if the price of a pair of socks falls from $4 to $3?

Use Figure: The Market Demand for Canoes. How much consumer surplus will be lost of the price increases by $5? Figure: The Market Demand for Canoes

Use Table: Individual Demand Schedules for Pairs of Socks. If the price of a pair of socks is $5, how much total consumer surplus will exist in the market?

Refer to the table Amelie's Demand for Running Shoes. What is Amelie's consumer surplus at the quantity she would be willing to buy at a price of $70?

Use Table: Individual Demand Schedules for Pairs of Socks. If the price of a pair of socks rises from $6 to $7, by how much did total consumer surplus change in the market?

Use Table: Individual Demand Schedules for Pairs of Socks. If the price of a pair of socks is $8, how much consumer surplus will Daphne enjoy?

Use Table: Individual Demand Schedules for Pairs of Socks. If the price of a pair of socks rises from $6 to $7, by how much did Niles's consumer surplus change?

If chips and pretzels are substitutes, then when the price of chips decreases, the quantity demanded of chips _, and the demand for pretzels _.

Consumers consider that good A and good B are substitutable in consumption. When the price of good A increases, there is an expectation that there is _ in quantity of good A demanded and _ in the demand for good

Use Table: Individual Demand Schedules for Pairs of Socks. If the price of a pair of socks is $8, how much consumer surplus will Niles enjoy?