Question 1

Sugar and honey are viewed as substitutes for each other in many recipes. If the price of sugar rises, we would expect _____

Accepted Answer

A)  the demand for honey to increase. 
B)  the demand for honey to decrease. 
C)  the quantity demanded of honey to decrease. 
D)  the price of honey to decrease. 
E)  the quantity demanded of honey to increase. 
A)  the demand for honey to increase. 
B)  the demand for honey to decrease. 
C)  the quantity demanded of honey to decrease. 
D)  the price of honey to decrease. 
E)  the quantity demanded of honey to increase.

Question 2

If demand decreases, then quantity supplied will increase.

Accepted Answer

A) True 
 B)False

Question 3

The equilibrium point represents the only price-quantity combination in a market that _____

Accepted Answer

A)  causes both buyers and sellers to agree to a price increase. 
B)  causes both buyers and sellers to agree to a price decrease. 
C)  exactly matches the independent plans of buyers and sellers. 
D)  maximizes the total utility of all buyers. 
E)  allows sellers to earn a positive profit. 
A)  causes both buyers and sellers to agree to a price increase. 
B)  causes both buyers and sellers to agree to a price decrease. 
C)  exactly matches the independent plans of buyers and sellers. 
D)  maximizes the total utility of all buyers. 
E)  allows sellers to earn a positive profit.

Question 4

Exhibit 4.7
  
-Suppose the current equilibrium price of pizza is $5. If the government decides the price of pizza cannot rise above $4, there would be _____

Accepted Answer

A)  a shortage of pizzas. 
B)  a surplus of pizzas. 
C)  a rightward shift of the supply curve of pizzas. 
D)  no impact on the equilibrium price and quantity of pizzas. 
E)  a rightward shift of the demand curve for pizzas. 
A)  a shortage of pizzas. 
B)  a surplus of pizzas. 
C)  a rightward shift of the supply curve of pizzas. 
D)  no impact on the equilibrium price and quantity of pizzas. 
E)  a rightward shift of the demand curve for pizzas.

Question 5

Exhibit 4.1
  
-Refer to Exhibit 4.1 for the demand curves of baby formula. Which of the following changes is likely to happen if the price of baby formula increases?

Accepted Answer

A)  a shift of the demand curve from D₁ to D₂ 
B)  a movement along the demand curve D₁ from point a to point b 
C)  a shift of the demand curve from D₂ to D₁ 
D)  a movement along the demand curve D₂ from point d to point c 
E)  a movement from point b on the demand curve D₁ to point c on the demand curve D₂ 
A)  a shift of the demand curve from D₁ to D₂ 
B)  a movement along the demand curve D₁ from point a to point b 
C)  a shift of the demand curve from D₂ to D₁ 
D)  a movement along the demand curve D₂ from point d to point c 
E)  a movement from point b on the demand curve D₁ to point c on the demand curve D₂

Question 6

The demand for a product is the amount of the product that _____

Accepted Answer

A)  sellers are willing and able to sell at different prices. 
B)  buyers are willing to purchase over different time periods. 
C)  sellers are willing to sell at a particular price. 
D)  buyers are willing and able to purchase at different prices. 
E)  buyers are willing to consume at a constant price. 
A)  sellers are willing and able to sell at different prices. 
B)  buyers are willing to purchase over different time periods. 
C)  sellers are willing to sell at a particular price. 
D)  buyers are willing and able to purchase at different prices. 
E)  buyers are willing to consume at a constant price.

Question 7

Over the last few years, the demand for DVDs has increased. However, the equilibrium price for DVDs has fallen. Which of the following, if true, best explains this situation?

Accepted Answer

A)  The quantity supplied of DVDs decreased during this period. 
B)  There has been a shortage of DVDs during this period. 
C)  The supply of DVDs decreased more than the increase in the demand for DVDs. 
D)  The demand for DVDs has increased more than the decrease in the supply of DVDs. 
E)  The supply of DVDs increased more than the increase in the demand for DVDs. 
A)  The quantity supplied of DVDs decreased during this period. 
B)  There has been a shortage of DVDs during this period. 
C)  The supply of DVDs decreased more than the increase in the demand for DVDs. 
D)  The demand for DVDs has increased more than the decrease in the supply of DVDs. 
E)  The supply of DVDs increased more than the increase in the demand for DVDs.

Question 8

If corn and soybeans are alternative crops grown by most farmers, an increase in the price of corn, other things constant, is likely to _____

Accepted Answer

A)  increase the supply of corn. 
B)  increase the supply of soybeans. 
C)  decrease the supply of soybeans. 
D)  decrease the supply of corn. 
E)  decrease the demand for soybeans. 
A)  increase the supply of corn. 
B)  increase the supply of soybeans. 
C)  decrease the supply of soybeans. 
D)  decrease the supply of corn. 
E)  decrease the demand for soybeans.

Question 9

The market supply curve of a particular product indicates the total quantities _____

Accepted Answer

A)  that are actually sold during different time periods. 
B)  that buyers are willing to purchase at alternative prices. 
C)  that sellers are willing and able to offer at alternative prices. 
D)  that sellers are willing to offer for sale at a fixed price. 
E)  of complements offered for sale. 
A)  that are actually sold during different time periods. 
B)  that buyers are willing to purchase at alternative prices. 
C)  that sellers are willing and able to offer at alternative prices. 
D)  that sellers are willing to offer for sale at a fixed price. 
E)  of complements offered for sale.

Question 10

Tickets to the Michigan-Notre Dame football game are usually sold out in advance. This suggests that _____

Accepted Answer

A)  the price of the tickets is set by the football teams. 
B)  the price of the tickets is set below the equilibrium level. 
C)  the football stadium is relatively small. 
D)  the demand for the tickets is highly price elastic. 
E)  the price of the tickets is set above the equilibrium level. 
A)  the price of the tickets is set by the football teams. 
B)  the price of the tickets is set below the equilibrium level. 
C)  the football stadium is relatively small. 
D)  the demand for the tickets is highly price elastic. 
E)  the price of the tickets is set above the equilibrium level.

Question 11

In which of the following situations is the change in the equilibrium price of a good indeterminate?

Accepted Answer

A)  when supply decreases and demand increases 
B)  when demand decreases and supply increases 
C)  when demand remains constant and supply increases 
D)  when supply and demand both decrease 
E)  when supply remains constant and demand increases 
A)  when supply decreases and demand increases 
B)  when demand decreases and supply increases 
C)  when demand remains constant and supply increases 
D)  when supply and demand both decrease 
E)  when supply remains constant and demand increases

Question 12

Which of the following is the best example of a pair of complements?

Accepted Answer

A)  milk and coffee 
B)  coffee and tea 
C)  CDs and DVDs 
D)  hiking boots and athletic shoes 
E)  paperback books and hardcover books 
A)  milk and coffee 
B)  coffee and tea 
C)  CDs and DVDs 
D)  hiking boots and athletic shoes 
E)  paperback books and hardcover books

Question 13

Suppose the market for a good is initially in equilibrium. For a given upward-sloping supply curve, all other things remaining unchanged, an increase in demand will typically _____

Accepted Answer

A)  increase the equilibrium price but the change the equilibrium quantity in either direction. 
B)  increase the equilibrium quantity but change the equilibrium price in either direction. 
C)  increase the equilibrium price but leave the equilibrium quantity unchanged. 
D)  decrease both the equilibrium quantity and price. 
E)  increase both the equilibrium quantity and price. 
A)  increase the equilibrium price but the change the equilibrium quantity in either direction. 
B)  increase the equilibrium quantity but change the equilibrium price in either direction. 
C)  increase the equilibrium price but leave the equilibrium quantity unchanged. 
D)  decrease both the equilibrium quantity and price. 
E)  increase both the equilibrium quantity and price.

Question 14

Which of the following best defines supply?

Accepted Answer

A)  the amount of a good that producers want to sell at a fixed price 
B)  the amount of a good that consumers want to buy at different income levels 
C)  the amount of a good that producers are willing and able to sell at each possible price, other things constant 
D)  the amount of a good that is produced at the least possible cost, other things constant 
E)  the amount of a good that consumers are willing and able to buy at each possible price, other things constant 
A)  the amount of a good that producers want to sell at a fixed price 
B)  the amount of a good that consumers want to buy at different income levels 
C)  the amount of a good that producers are willing and able to sell at each possible price, other things constant 
D)  the amount of a good that is produced at the least possible cost, other things constant 
E)  the amount of a good that consumers are willing and able to buy at each possible price, other things constant

Question 15

Which of the following will cause a movement along the supply curve?

Accepted Answer

A)  the state of technology and know-how 
B)  the prices of resources 
C)  the prices of other goods 
D)  producer expectations 
E)  change in price 
A)  the state of technology and know-how 
B)  the prices of resources 
C)  the prices of other goods 
D)  producer expectations 
E)  change in price

Question 16

Two events occur simultaneously in the market for automobiles: (1) an improvement in assembly line technology and (2) a recession in the economy that decreases consumers' income. Which of the following can be predicted about this market with certainty?

Accepted Answer

A)  the equilibrium quantity will rise 
B)  the equilibrium quantity will fall 
C)  the equilibrium price will rise 
D)  the equilibrium price will fall 
E)  the equilibrium price will remain the same 
A)  the equilibrium quantity will rise 
B)  the equilibrium quantity will fall 
C)  the equilibrium price will rise 
D)  the equilibrium price will fall 
E)  the equilibrium price will remain the same

Question 17

Which of the following would most likely increase the supply of college textbooks?

Accepted Answer

A)  the exit of five major publishers from the industry 
B)  an increase in the cost of paper used in the books 
C)  an increase in the wage rate of workers associated with printing 
D)  an expectation of a price rise in the future 
E)  an improvement in the technology used in book production 
A)  the exit of five major publishers from the industry 
B)  an increase in the cost of paper used in the books 
C)  an increase in the wage rate of workers associated with printing 
D)  an expectation of a price rise in the future 
E)  an improvement in the technology used in book production

Question 18

Exhibit 4.9
  
-As shown in the Exhibit given below, when the government sets rent at $750 per month, the result is a(n) _____

Accepted Answer

A)  equilibrium in the market for rented apartments. 
B)  increase in the supply of rented apartments. 
C)  shortage of rented apartments. 
D)  economic profit for the owners of rented apartments. 
E)  decrease in the demand for rented apartments. 
A)  equilibrium in the market for rented apartments. 
B)  increase in the supply of rented apartments. 
C)  shortage of rented apartments. 
D)  economic profit for the owners of rented apartments. 
E)  decrease in the demand for rented apartments.

Question 19

Exhibit 4.9
  
-In a rental market like the one in the Exhibit given below, a government-imposed rule that rent cannot exceed $750 per month is referred to as _____

Accepted Answer

A)  a trade barrier. 
B)  quality control. 
C)  a price ceiling. 
D)  a price floor. 
E)  a subsidy. 
A)  a trade barrier. 
B)  quality control. 
C)  a price ceiling. 
D)  a price floor. 
E)  a subsidy.

Question 20

Table 4.2
 $$\begin{array}{l}
\text { Table } 4.2\
\begin{array} { | l | l | } 
\hline \begin{array} { l } 
\text { Price per Pizza } \
( \$ )
\end{array} & \begin{array} { l } 
\text { Quantity Supplied per Week } \
\text { (millions) }
\end{array} \
\hline 15 & 28 \
\hline 12 & 24 \
\hline 9 & 20 \
\hline 6 & 16 \
\hline 3 & 12 \
\hline
\end{array}
\end{array}$$
-Refer to the market supply schedule for pizza in Table 4.2. When the price is $6, what is the quantity supplied in the pizza market?

Accepted Answer

A)  28 million pizzas 
B)  24 million pizzas 
C)  20 million pizzas 
D)  16 million pizzas 
E)  12 million pizzas 
A)  28 million pizzas 
B)  24 million pizzas 
C)  20 million pizzas 
D)  16 million pizzas 
E)  12 million pizzas

Sugar and honey are viewed as substitutes for each other in many recipes. If the price of sugar rises, we would expect _____

If demand decreases, then quantity supplied will increase.

The equilibrium point represents the only price-quantity combination in a market that _____

Exhibit 4.7 -Suppose the current equilibrium price of pizza is $5. If the government decides the price of pizza cannot rise above $4, there would be _____

Exhibit 4.1 -Refer to Exhibit 4.1 for the demand curves of baby formula. Which of the following changes is likely to happen if the price of baby formula increases?

The demand for a product is the amount of the product that _____

Over the last few years, the demand for DVDs has increased. However, the equilibrium price for DVDs has fallen. Which of the following, if true, best explains this situation?

If corn and soybeans are alternative crops grown by most farmers, an increase in the price of corn, other things constant, is likely to _____

The market supply curve of a particular product indicates the total quantities _____

Tickets to the Michigan-Notre Dame football game are usually sold out in advance. This suggests that _____

In which of the following situations is the change in the equilibrium price of a good indeterminate?

Which of the following is the best example of a pair of complements?

Suppose the market for a good is initially in equilibrium. For a given upward-sloping supply curve, all other things remaining unchanged, an increase in demand will typically _____

Which of the following best defines supply?

Which of the following will cause a movement along the supply curve?

Two events occur simultaneously in the market for automobiles: (1) an improvement in assembly line technology and (2) a recession in the economy that decreases consumers' income. Which of the following can be predicted about this market with certainty?

Which of the following would most likely increase the supply of college textbooks?

Exhibit 4.9 -As shown in the Exhibit given below, when the government sets rent at $750 per month, the result is a(n) _____

Exhibit 4.9 -In a rental market like the one in the Exhibit given below, a government-imposed rule that rent cannot exceed $750 per month is referred to as _____

Table 4.2 Table 4.2 Price per Pizza (\ ) Quantity Supplied per Week (millions) 15 28 12 24 9 20 6 16 3 12 -Refer to the market supply schedule for pizza in Table 4.2. When the price is $6, what is the quantity supplied in the pizza market?

The Art and Science of Economic Analysis.

Economic Tools and Economic Systems.

Economic Decision Makers.

Introduction to Macroeconomics.

Tracking the U. S. Economy.

Unemployment and Inflation.

Productivity and Growth.

Aggregate Demand.

Aggregate Supply.

Fiscal Policy.

Federal Budgets and Public Policy.

Money and the Financial System.

Banking and the Money Supply.

Monetary Theory and Policy.

Macro Policy Debate: Active or Passive?

International Trade.

International Finance.

Economic Development.

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Exam 4: Demand, Supply, and Markets.

Sugar and honey are viewed as substitutes for each other in many recipes. If the price of sugar rises, we would expect _____

If demand decreases, then quantity supplied will increase.

The equilibrium point represents the only price-quantity combination in a market that _____

Exhibit 4.7 -Suppose the current equilibrium price of pizza is $5. If the government decides the price of pizza cannot rise above $4, there would be _____

Exhibit 4.1 -Refer to Exhibit 4.1 for the demand curves of baby formula. Which of the following changes is likely to happen if the price of baby formula increases?

The demand for a product is the amount of the product that _____

Over the last few years, the demand for DVDs has increased. However, the equilibrium price for DVDs has fallen. Which of the following, if true, best explains this situation?

If corn and soybeans are alternative crops grown by most farmers, an increase in the price of corn, other things constant, is likely to _____

The market supply curve of a particular product indicates the total quantities _____

Tickets to the Michigan-Notre Dame football game are usually sold out in advance. This suggests that _____

In which of the following situations is the change in the equilibrium price of a good indeterminate?

Which of the following is the best example of a pair of complements?

Suppose the market for a good is initially in equilibrium. For a given upward-sloping supply curve, all other things remaining unchanged, an increase in demand will typically _____

Which of the following best defines supply?

Which of the following will cause a movement along the supply curve?

Two events occur simultaneously in the market for automobiles: (1) an improvement in assembly line technology and (2) a recession in the economy that decreases consumers' income. Which of the following can be predicted about this market with certainty?

Which of the following would most likely increase the supply of college textbooks?

Exhibit 4.9 -As shown in the Exhibit given below, when the government sets rent at $750 per month, the result is a(n) _____

Exhibit 4.9 -In a rental market like the one in the Exhibit given below, a government-imposed rule that rent cannot exceed $750 per month is referred to as _____

Table 4.2 Table 4.2 Price per Pizza (\ ) Quantity Supplied per Week (millions) 15 28 12 24 9 20 6 16 3 12 -Refer to the market supply schedule for pizza in Table 4.2. When the price is $6, what is the quantity supplied in the pizza market?

The Art and Science of Economic Analysis.

Economic Tools and Economic Systems.

Economic Decision Makers.

Introduction to Macroeconomics.

Tracking the U. S. Economy.

Unemployment and Inflation.

Productivity and Growth.

Aggregate Demand.

Aggregate Supply.

Fiscal Policy.

Federal Budgets and Public Policy.

Money and the Financial System.

Banking and the Money Supply.

Monetary Theory and Policy.

Macro Policy Debate: Active or Passive?

International Trade.

International Finance.

Economic Development.

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