Question 1

Who or what allocates an economy's scarce resources

Accepted Answer

A) economic planners 
B) producers who use resources 
C) prices for resources 
D) government regulation of scarce resources 
A) economic planners 
B) producers who use resources 
C) prices for resources 
D) government regulation of scarce resources

Question 2

Figure 4-10
  
-Refer to the Figure 4-10.What is the movement from point A to point B on the graph called

Accepted Answer

A) a decrease in supply 
B) an increase in supply 
C) an increase in the quantity supplied 
D) a decrease in the quantity supplied 
A) a decrease in supply 
B) an increase in supply 
C) an increase in the quantity supplied 
D) a decrease in the quantity supplied

Question 3

What happens when there is a surplus in a market

Accepted Answer

A) There is upward pressure on price. 
B) There is downward pressure on price. 
C) The market is operating below the equilibrium level. 
D) There are too many buyers chasing too few goods. 
A) There is upward pressure on price. 
B) There is downward pressure on price. 
C) The market is operating below the equilibrium level. 
D) There are too many buyers chasing too few goods.

Question 4

Figure 4-7
  
-Refer to the Figure 4-7.What would cause the movement from point A to point B on the graph

Accepted Answer

A) an increase in price 
B) a decrease in price 
C) a decrease in the price of a complement good 
D) an increase in income 
A) an increase in price 
B) a decrease in price 
C) a decrease in the price of a complement good 
D) an increase in income

Question 5

Market demand is given as QD = 70 - P.Market supply is given as QS = 3P.If price increases from $30 to $34,what is the price elasticity of demand

Accepted Answer

A) 0.5 
B) 0.9 
C) 1.1 
D) 2.2 
A) 0.5 
B) 0.9 
C) 1.1 
D) 2.2

Question 6

What does a demand curve illustrate

Accepted Answer

A) the negative relationship between number of buyers and quantity demanded 
B) the positive relationship between price and quantity demanded 
C) the negative relationship between price and quantity demanded 
D) the maximum quantity of two goods an economy is capable of producing with available resources and technology 
A) the negative relationship between number of buyers and quantity demanded 
B) the positive relationship between price and quantity demanded 
C) the negative relationship between price and quantity demanded 
D) the maximum quantity of two goods an economy is capable of producing with available resources and technology

Question 7

For a seller,which of the following is NOT positively related

Accepted Answer

A) the price of the good and the seller's profit 
B) the price of the good and quantity supplied 
C) the seller's profit and product cost 
D) the seller's profit and quantity supplied 
A) the price of the good and the seller's profit 
B) the price of the good and quantity supplied 
C) the seller's profit and product cost 
D) the seller's profit and quantity supplied

Question 8

Market demand is given as QD = 150 - 3P.Market supply is given as QS = 2P.What would result if the market price were $25

Accepted Answer

A) a shortage of 25 
B) a surplus of 25 
C) a surplus of 105 
D) a shortage of 105 
A) a shortage of 25 
B) a surplus of 25 
C) a surplus of 105 
D) a shortage of 105

Question 9

Market demand is given as QD = 40 - 2P.Market supply is given as QS = 2P.If price increases from $4 to $7,what is the price elasticity of demand

Accepted Answer

A) 0.1 
B) 0.4 
C) 1.6 
D) 4.7 
A) 0.1 
B) 0.4 
C) 1.6 
D) 4.7

Question 10

Figure 4-5
  
-Refer to the Figure 4-5.Which of the four graphs represents the market for cars after new technology was installed on assembly lines

Accepted Answer

A) graph A 
B) graph B 
C) graph C 
D) graph D 
A) graph A 
B) graph B 
C) graph C 
D) graph D

Question 11

Figure 4-5
  
-Refer to the Figure 4-5.Which of the four graphs represents the market for oranges after disease impacts much of the Florida orange harvest

Accepted Answer

A) graph A 
B) graph B 
C) graph C 
D) graph D 
A) graph A 
B) graph B 
C) graph C 
D) graph D

Question 12

Ad Venture is a company that produces advertising video clips.Their supply curve is Qs=-2W+6P,where W (in 10s) is the hourly wage that the company pays their workers and P (in 1000s) is the ongoing market price for a 1-minute commercial.
a) If the current wage in the video industry is $35 (W=3.5),what is the minimum price that allows Ad Venture to remain in the industry (i.e.,to supply a positive number of videos)
 Draw the supply curve.
b) If the wage is $35,how much should the market price be so that Ad Venture produces 8 videos
c) At the price you have determined at point b., how does the number of videos supplied change if the wage decreases to $30? Show this situation in your graph.

Accepted Answer

a) The minimum price must make the quant

Question 13

If the demand for a product increases,what would we expect

Accepted Answer

A) equilibrium price to increase and equilibrium quantity to decrease 
B) equilibrium price to decrease and equilibrium quantity to increase 
C) equilibrium price and equilibrium quantity to both increase 
D) equilibrium price and equilibrium quantity to both decrease 
A) equilibrium price to increase and equilibrium quantity to decrease 
B) equilibrium price to decrease and equilibrium quantity to increase 
C) equilibrium price and equilibrium quantity to both increase 
D) equilibrium price and equilibrium quantity to both decrease

Question 14

Table 4-2
  
-Refer to the Table 4-2.What is the space that would represent an increase in equilibrium price and an indeterminate change in equilibrium quantity

Accepted Answer

A) space A 
B) space B 
C) space C 
D) space D 
A) space A 
B) space B 
C) space C 
D) space D

Question 15

Market demand is given as QD = 95- P.Market supply is given as QS = 3P + 15.What would result if the market price were $25

Accepted Answer

A) a shortage of 20 
B) a surplus of 20 
C) a surplus of 40 
D) a shortage of 40 
A) a shortage of 20 
B) a surplus of 20 
C) a surplus of 40 
D) a shortage of 40

Question 16

Figure 4-4
  
-Refer to the Figure 4-4.In this market,what would the equilibrium price and quantity be

Accepted Answer

A) $15 and 700 
B) $20 and 600 
C) $25 and 500 
D) $25 and 800 
A) $15 and 700 
B) $20 and 600 
C) $25 and 500 
D) $25 and 800

Question 17

What is the term for buyers and sellers who have no influence on market price

Accepted Answer

A) price makers 
B) market pawns 
C) price takers 
D) powerless 
A) price makers 
B) market pawns 
C) price takers 
D) powerless

Question 18

Market demand is given as QD = 220 - 4P.Market supply is given as QS = 2P + 40.If price increases from $5 to $10,what is the price elasticity of demand

Accepted Answer

A) 0 
B) 0.2 
C) 0.9 
D) 2.0 
A) 0 
B) 0.2 
C) 0.9 
D) 2.0

Question 19

What will happen to the equilibrium price of new textbooks if more students attend university,paper becomes cheaper,textbook authors accept lower royalties,and fewer used textbooks are sold

Accepted Answer

A) price will rise 
B) price will fall 
C) price will stay exactly the same 
D) price change will be ambiguous 
A) price will rise 
B) price will fall 
C) price will stay exactly the same 
D) price change will be ambiguous

Question 20

Market demand is given as QD = 120 - 2P.Market supply is given as QS = 2P + 40.In a perfectly competitive equilibrium,what will be price and quantity traded in the market

Accepted Answer

A) price will be $100 and quantity will be 240 
B) price will be $30 and quantity will be 100 
C) price will be $20 and quantity will be 80 
D) price will be $130 and quantity will be 300 
A) price will be $100 and quantity will be 240 
B) price will be $30 and quantity will be 100 
C) price will be $20 and quantity will be 80 
D) price will be $130 and quantity will be 300

Exam 4: The Market Forces of Supply and Demand

Who or what allocates an economy's scarce resources

Figure 4-10 -Refer to the Figure 4-10.What is the movement from point A to point B on the graph called

What happens when there is a surplus in a market

Figure 4-7 -Refer to the Figure 4-7.What would cause the movement from point A to point B on the graph

Market demand is given as QD = 70 - P.Market supply is given as QS = 3P.If price increases from $30 to $34,what is the price elasticity of demand

What does a demand curve illustrate

For a seller,which of the following is NOT positively related

Market demand is given as QD = 150 - 3P.Market supply is given as QS = 2P.What would result if the market price were $25

Market demand is given as QD = 40 - 2P.Market supply is given as QS = 2P.If price increases from $4 to $7,what is the price elasticity of demand

Figure 4-5 -Refer to the Figure 4-5.Which of the four graphs represents the market for cars after new technology was installed on assembly lines

Figure 4-5 -Refer to the Figure 4-5.Which of the four graphs represents the market for oranges after disease impacts much of the Florida orange harvest

If the demand for a product increases,what would we expect

Table 4-2 -Refer to the Table 4-2.What is the space that would represent an increase in equilibrium price and an indeterminate change in equilibrium quantity

Market demand is given as QD = 95- P.Market supply is given as QS = 3P + 15.What would result if the market price were $25

Figure 4-4 -Refer to the Figure 4-4.In this market,what would the equilibrium price and quantity be

What is the term for buyers and sellers who have no influence on market price

Market demand is given as QD = 220 - 4P.Market supply is given as QS = 2P + 40.If price increases from $5 to $10,what is the price elasticity of demand

What will happen to the equilibrium price of new textbooks if more students attend university,paper becomes cheaper,textbook authors accept lower royalties,and fewer used textbooks are sold

Market demand is given as QD = 120 - 2P.Market supply is given as QS = 2P + 40.In a perfectly competitive equilibrium,what will be price and quantity traded in the market

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 Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

Filters

Market demand is given as Q_D= 70 - P.Market supply is given as Q_S= 3P.If price increases from $30 to $34,what is the price elasticity of demand

Market demand is given as Q_D= 150 - 3P.Market supply is given as Q_S= 2P.What would result if the market price were $25

Market demand is given as Q_D= 40 - 2P.Market supply is given as Q_S= 2P.If price increases from $4 to $7,what is the price elasticity of demand

Market demand is given as Q_D= 95- P.Market supply is given as Q_S= 3P + 15.What would result if the market price were $25

Market demand is given as Q_D= 220 - 4P.Market supply is given as Q_S= 2P + 40.If price increases from $5 to $10,what is the price elasticity of demand

Market demand is given as Q_D= 120 - 2P.Market supply is given as Q_S= 2P + 40.In a perfectly competitive equilibrium,what will be price and quantity traded in the market