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

Soft drinks are a normal good.Draw a graph showing the effect of an increase in income on the demand for soft drinks.

Accepted Answer

The answer of Soft drinks are a normal good.Draw a...

Question 3

-The above figures show the market for HD televisions.If people's incomes increase and HD televisions are a normal good, 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 4

-Contractors can use plywood or brick to construct walls.Suppose the price of bricks increases.Which of the figures above best illustrates the effect of this change on the market for plywood?

Accepted Answer

A) Figure A 
B) Figure B 
C) Figure C 
D) Figure D 
E) Figure A or Figure C depending on how contractors react to the higher price of bricks. 
A) Figure A 
B) Figure B 
C) Figure C 
D) Figure D 
E) Figure A or Figure C depending on how contractors react to the higher price of bricks.

Question 5

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

Accepted Answer

The factors that change supply are produ

Question 6

-The graph illustrates the supply of sweaters.As the technology used to produce sweaters improves, the

Accepted Answer

A) supply of sweaters decreases and the demand for sweaters does not change. 
B) supply of sweaters increases and the demand for sweaters does not change. 
C) quantity of sweaters supplied increases. 
D) quantity of sweaters supplied decreases. 
E) supply of sweaters increases and the demand for sweaters increases. 
A) supply of sweaters decreases and the demand for sweaters does not change. 
B) supply of sweaters increases and the demand for sweaters does not change. 
C) quantity of sweaters supplied increases. 
D) quantity of sweaters supplied decreases. 
E) supply of sweaters increases and the demand for sweaters increases.

Question 7

A surplus of cardboard boxes means that

Accepted Answer

A) at the current price of a cardboard box, the quantity demanded exceeds the quantity supplied. 
B) at the current price of a cardboard box, the quantity demanded is less than the quantity supplied. 
C) the current price of a cardboard box is less than the equilibrium price. 
D) at the current price of a cardboard box, the quantity demanded equals the quantity supplied and the price will fall to restore the equilibrium.. 
E) More information is needed to determine if the price of cardboard boxes is higher than, lower than, or equal to the equilibrium price. 
A) at the current price of a cardboard box, the quantity demanded exceeds the quantity supplied. 
B) at the current price of a cardboard box, the quantity demanded is less than the quantity supplied. 
C) the current price of a cardboard box is less than the equilibrium price. 
D) at the current price of a cardboard box, the quantity demanded equals the quantity supplied and the price will fall to restore the equilibrium.. 
E) More information is needed to determine if the price of cardboard boxes is higher than, lower than, or equal to the equilibrium price.

Question 8

Market demand curves are obtained by

Accepted Answer

A) determining the price each consumer is willing to pay for the good and summing those prices across all consumers. 
B) observing the prices and quantities sold in a market over time and plotting those price-quantity combinations in a graph. 
C) summing the quantities every consumer is willing to buy at each different price. 
D) observing the behavior of an individual consumer in a market. 
E) averaging the quantities every consumer is willing to buy at each different price. 
A) determining the price each consumer is willing to pay for the good and summing those prices across all consumers. 
B) observing the prices and quantities sold in a market over time and plotting those price-quantity combinations in a graph. 
C) summing the quantities every consumer is willing to buy at each different price. 
D) observing the behavior of an individual consumer in a market. 
E) averaging the quantities every consumer is willing to buy at each different price.

Question 9

If a freeze destroys oranges before they are harvested, the equilibrium price of an orange ________ and the equilibrium quantity ________.

Accepted Answer

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

Question 10

What happens to the demand for a good if a complement's price increases?

Accepted Answer

A) The demand decreases and the demand curve shifts rightward. 
B) The demand increases and the demand curve shifts rightward. 
C) The demand decreases and the demand curve shifts leftward. 
D) The demand increases and the demand curve shifts leftward. 
E) There is no impact on demand for the good and the demand curve does not shift. 
A) The demand decreases and the demand curve shifts rightward. 
B) The demand increases and the demand curve shifts rightward. 
C) The demand decreases and the demand curve shifts leftward. 
D) The demand increases and the demand curve shifts leftward. 
E) There is no impact on demand for the good and the demand curve does not shift.

Question 11

-Using the data in the table above, if the price of a stapler is $8, then there is a ________ of staplers and the quantity of staplers demanded ________ the quantity of staplers supplied.

Accepted Answer

A) surplus; is greater than 
B) surplus; is less than 
C) shortage; is greater than 
D) shortage; is less than 
E) neither a surplus nor a shortage; equals 
A) surplus; is greater than 
B) surplus; is less than 
C) shortage; is greater than 
D) shortage; is less than 
E) neither a surplus nor a shortage; equals

Question 12

-A construction boom occurs and many of the new buildings need plywood for their framing.Which of the figures above best illustrates this change?

Accepted Answer

A) Figure A 
B) Figure B 
C) Figure C 
D) Figure D 
E) Figure A or Figure C 
A) Figure A 
B) Figure B 
C) Figure C 
D) Figure D 
E) Figure A or Figure C

Question 13

Suppose over the next several years the productivity of firms producing electric cars improves dramatically.The advance in productivity leads to

Accepted Answer

A) a decrease in the supply of electric cars so that the supply curve shifts leftward. 
B) a decrease in the supply of electric cars so that the supply curve shifts rightward. 
C) an increase in the supply of electric cars so that the supply curve shifts leftward. 
D) an increase in the supply electric cars so that the supply curve shifts rightward. 
E) no change in the supply of electric cars, only a change in the quantity supplied of electric cars. 
A) a decrease in the supply of electric cars so that the supply curve shifts leftward. 
B) a decrease in the supply of electric cars so that the supply curve shifts rightward. 
C) an increase in the supply of electric cars so that the supply curve shifts leftward. 
D) an increase in the supply electric cars so that the supply curve shifts rightward. 
E) no change in the supply of electric cars, only a change in the quantity supplied of electric cars.

Question 14

-Market equilibrium occurs when

Accepted Answer

A) the quantity demanded equals the quantity supplied. 
B) the market is changing rapidly. 
C) other things remain the same. 
D) buyers get the lowest possible price. 
E) everyone who wants the good gets the quantity he or she wants. 
A) the quantity demanded equals the quantity supplied. 
B) the market is changing rapidly. 
C) other things remain the same. 
D) buyers get the lowest possible price. 
E) everyone who wants the good gets the quantity he or she wants.

Question 15

Oil refiners can refine a barrel of petroleum so that it yields either more home heating oil or more diesel fuel.If the price of diesel fuel falls, there is

Accepted Answer

A) an increase in the supply of home heating oil. 
B) a decrease in the supply of home heating oil. 
C) an increase in the quantity of home heating oil supplied. 
D) a decrease in the quantity of home heating oil supplied. 
E) an increase in the demand for home heating oil. 
A) an increase in the supply of home heating oil. 
B) a decrease in the supply of home heating oil. 
C) an increase in the quantity of home heating oil supplied. 
D) a decrease in the quantity of home heating oil supplied. 
E) an increase in the demand for home heating oil.

Question 16

One reason supply curves have an upward slope is because

Accepted Answer

A) increased supply will require increased technology. 
B) people will pay a higher price when less is supplied. 
C) a higher price brings a greater profit, so firms want to sell more of that good. 
D) to have more of the good supplied requires more firms to open. 
E) None of the above answers is correct because supply curves have a downward slope. 
A) increased supply will require increased technology. 
B) people will pay a higher price when less is supplied. 
C) a higher price brings a greater profit, so firms want to sell more of that good. 
D) to have more of the good supplied requires more firms to open. 
E) None of the above answers is correct because supply curves have a downward slope.

Question 17

-The table above shows the situation in the gasoline market in Tulsa, Oklahoma.If the price of a gallon of gasoline is $3.65, 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 18

-The diagram above illustrates the market for apartments in Victoria, British Columbia.
a∙If the current rent is $300 per month, is there a shortage or surplus in the apartment market and how much is the shortage or surplus?
b∙What is the equilibrium rent and quantity of apartments?

Accepted Answer

a∙If the rent is $300 per mont

Question 19

-Consider the market for wheat.If there is an improvement in harvesting technology,

Accepted Answer

A) the supply curve for wheat shifts rightward. 
B) the demand curve for wheat shifts rightward. 
C) there is a movement up along the demand curve. 
D) the equilibrium price rises. 
E) the demand curve for wheat shifts leftward. 
A) the supply curve for wheat shifts rightward. 
B) the demand curve for wheat shifts rightward. 
C) there is a movement up along the demand curve. 
D) the equilibrium price rises. 
E) the demand curve for wheat shifts leftward.

Question 20

Autoworkers negotiate a wage increase.How does this change affect the supply curve of cars?

Accepted Answer

A) It shifts the supply curve leftward. 
B) It shifts the supply curve rightward. 
C) It does not shift the supply curve or create a movement along it. 
D) The supply curve will shift but there is not enough information to tell if the change shifts the supply curve rightward, leftward, or not at all. 
E) It creates a movement downward along the supply curve. 
A) It shifts the supply curve leftward. 
B) It shifts the supply curve rightward. 
C) It does not shift the supply curve or create a movement along it. 
D) The supply curve will shift but there is not enough information to tell if the change shifts the supply curve rightward, leftward, or not at all. 
E) It creates a movement downward along the supply curve.

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

Soft drinks are a normal good.Draw a graph showing the effect of an increase in income on the demand for soft drinks.

-The above figures show the market for HD televisions.If people's incomes increase and HD televisions are a normal good, which figure shows the effect of this change?

-Contractors can use plywood or brick to construct walls.Suppose the price of bricks increases.Which of the figures above best illustrates the effect of this change on the market for plywood?

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

-The graph illustrates the supply of sweaters.As the technology used to produce sweaters improves, the

A surplus of cardboard boxes means that

Market demand curves are obtained by

If a freeze destroys oranges before they are harvested, the equilibrium price of an orange and the equilibrium quantity .

What happens to the demand for a good if a complement's price increases?

-Using the data in the table above, if the price of a stapler is $8, then there is a of staplers and the quantity of staplers demanded the quantity of staplers supplied.

-A construction boom occurs and many of the new buildings need plywood for their framing.Which of the figures above best illustrates this change?

Suppose over the next several years the productivity of firms producing electric cars improves dramatically.The advance in productivity leads to

-Market equilibrium occurs when

Oil refiners can refine a barrel of petroleum so that it yields either more home heating oil or more diesel fuel.If the price of diesel fuel falls, there is

One reason supply curves have an upward slope is because

-The table above shows the situation in the gasoline market in Tulsa, Oklahoma.If the price of a gallon of gasoline is $3.65, then

-The diagram above illustrates the market for apartments in Victoria, British Columbia. a∙If the current rent is $300 per month, is there a shortage or surplus in the apartment market and how much is the shortage or surplus? b∙What is the equilibrium rent and quantity of apartments?

-Consider the market for wheat.If there is an improvement in harvesting technology,

Autoworkers negotiate a wage increase.How does this change affect the supply curve of cars?

Getting Started

The Usand 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?

Soft drinks are a normal good.Draw a graph showing the effect of an increase in income on the demand for soft drinks.

-The above figures show the market for HD televisions.If people's incomes increase and HD televisions are a normal good, which figure shows the effect of this change?

-Contractors can use plywood or brick to construct walls.Suppose the price of bricks increases.Which of the figures above best illustrates the effect of this change on the market for plywood?

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

-The graph illustrates the supply of sweaters.As the technology used to produce sweaters improves, the

A surplus of cardboard boxes means that

Market demand curves are obtained by

If a freeze destroys oranges before they are harvested, the equilibrium price of an orange ________ and the equilibrium quantity ________.

What happens to the demand for a good if a complement's price increases?

-Using the data in the table above, if the price of a stapler is $8, then there is a ________ of staplers and the quantity of staplers demanded ________ the quantity of staplers supplied.

-A construction boom occurs and many of the new buildings need plywood for their framing.Which of the figures above best illustrates this change?

Suppose over the next several years the productivity of firms producing electric cars improves dramatically.The advance in productivity leads to

-Market equilibrium occurs when

Oil refiners can refine a barrel of petroleum so that it yields either more home heating oil or more diesel fuel.If the price of diesel fuel falls, there is

One reason supply curves have an upward slope is because

-The table above shows the situation in the gasoline market in Tulsa, Oklahoma.If the price of a gallon of gasoline is $3.65, then

-The diagram above illustrates the market for apartments in Victoria, British Columbia. a∙If the current rent is $300 per month, is there a shortage or surplus in the apartment market and how much is the shortage or surplus? b∙What is the equilibrium rent and quantity of apartments?

-Consider the market for wheat.If there is an improvement in harvesting technology,

Autoworkers negotiate a wage increase.How does this change affect the supply curve of cars?

Getting Started

The Usand 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

If a freeze destroys oranges before they are harvested, the equilibrium price of an orange and the equilibrium quantity .

-Using the data in the table above, if the price of a stapler is $8, then there is a of staplers and the quantity of staplers demanded the quantity of staplers supplied.