Question 1

Suppose that the equilibrium price and quantity of new houses both increase.Which of the following could be a cause of this change?

Accepted Answer

A) The wage paid carpenters who build new houses might have risen. 
B) A technological advance in framing a new house might have occurred. 
C) The rent for nearby apartments might have fallen. 
D) More home buyers might have moved into the area. 
E) The cost of wood framing used to build houses might have fallen. 
A) The wage paid carpenters who build new houses might have risen. 
B) A technological advance in framing a new house might have occurred. 
C) The rent for nearby apartments might have fallen. 
D) More home buyers might have moved into the area. 
E) The cost of wood framing used to build houses might have fallen.

Question 2

-The above table gives the demand and supply schedules for cat food.If the price is $1.00 per pound of cat food, will there be a shortage, a surplus, or is this price the equilibrium price? If there is a shortage, how much is the shortage? If there is a surplus, how much is the surplus? If $3.00 is the equilibrium price, what is the equilibrium quantity?

Accepted Answer

At a price of $1.00 per pound

Question 3

Consider the market for smart phones.Which of the following shifts the demand curve rightward?

Accepted Answer

A) an increase in the price of smart phones 
B) a decrease in the price of smart phones 
C) an increase in the price of land-line phone service, a substitute for smart phones 
D) a decrease in the number of smart phone buyers 
E) an increase in the supply of smart phones. 
A) an increase in the price of smart phones 
B) a decrease in the price of smart phones 
C) an increase in the price of land-line phone service, a substitute for smart phones 
D) a decrease in the number of smart phone buyers 
E) an increase in the supply of smart phones.

Question 4

The price of salsa rises.How does the increase in the price of salsa affect the supply of salsa?

Accepted Answer

A) The supply of salsa increases. 
B) The supply of salsa decreases. 
C) There is no change to either the supply of salsa or the quantity of salsa supplied. 
D) There is no change to the supply of salsa, but the quantity of salsa supplied increases. 
E) There is no change to the supply of salsa, but the quantity of salsa supplied decreases. 
A) The supply of salsa increases. 
B) The supply of salsa decreases. 
C) There is no change to either the supply of salsa or the quantity of salsa supplied. 
D) There is no change to the supply of salsa, but the quantity of salsa supplied increases. 
E) There is no change to the supply of salsa, but the quantity of salsa supplied decreases.

Question 5

-Consider the market for peanut butter.If there is an increase in the price of peanuts,

Accepted Answer

A) there is an upward movement along the supply curve for peanut butter. 
B) the supply curve for peanuts shifts rightward. 
C) there is a decrease in the supply of peanuts. 
D) there is a decrease in the supply of peanut butter. 
E) there is a decrease in the demand for peanut butter. 
A) there is an upward movement along the supply curve for peanut butter. 
B) the supply curve for peanuts shifts rightward. 
C) there is a decrease in the supply of peanuts. 
D) there is a decrease in the supply of peanut butter. 
E) there is a decrease in the demand for peanut butter.

Question 6

What is the "quantity demanded"?

Accepted Answer

A) the amount of a good people desire 
B) the amount of a good people are able and willing to buy during a specific time period and at a given price 
C) the amount of a good people are able and willing to buy at all possible prices 
D) the maximum amount of a good that can be consumed during a specific time period 
E) the minimum amount of a good that people are willing to buy during a specific time period and at a given price 
A) the amount of a good people desire 
B) the amount of a good people are able and willing to buy during a specific time period and at a given price 
C) the amount of a good people are able and willing to buy at all possible prices 
D) the maximum amount of a good that can be consumed during a specific time period 
E) the minimum amount of a good that people are willing to buy during a specific time period and at a given price

Question 7

-The above table gives the demand and supply schedules for cat food.If the price is $3.00 per pound of cat food, will there be a shortage, a surplus, or is this price the equilibrium price? If there is a shortage, how much is the shortage? If there is a surplus, how much is the surplus? If $3.00 is the equilibrium price, what is the equilibrium quantity?

Accepted Answer

At a price of $3.00 per pound

Question 8

Suppose Ramen noodles, an inexpensive but a quite tasty dish, are an inferior good.Why do grocery stores in college towns, that is, towns with a large fraction of college students, stock a lot of Ramen noodles?

Accepted Answer

Generally, college students' incomes are

Question 9

A demand schedule

Accepted Answer

A) shows the quantity demanded at one price. 
B) is a graph showing a relationship between the quantity demanded and the price of a good. 
C) is a list of the quantities demanded at each different price when all other influences on buying plans remain the same. 
D) shows that demand is on schedule. 
E) shows how the demand changes when the supply changes. 
A) shows the quantity demanded at one price. 
B) is a graph showing a relationship between the quantity demanded and the price of a good. 
C) is a list of the quantities demanded at each different price when all other influences on buying plans remain the same. 
D) shows that demand is on schedule. 
E) shows how the demand changes when the supply changes.

Question 10

What are substitutes in production?

Accepted Answer

Goods are substitutes in produ

Question 11

What is the difference between quantity supplied and supply?

Accepted Answer

Quantity supplied is the amount that peo

Question 12

-Which of the following events will increase the quantity demanded of bottled water?

Accepted Answer

A) a fall in the price of soda 
B) a rise in the price of a fitness club membership 
C) an increase in the number of buyers of bottled water 
D) a fall in the price of bottled water 
E) a rise in the price of bottled water 
A) a fall in the price of soda 
B) a rise in the price of a fitness club membership 
C) an increase in the number of buyers of bottled water 
D) a fall in the price of bottled water 
E) a rise in the price of bottled water

Question 13

A demand curve

Accepted Answer

A) has an upward slope. 
B) has a downward slope. 
C) is a graph of the relationship between quantity demanded of a good and its price. 
D) Both answers B and C are correct. 
E) Both answers A and C are correct. 
A) has an upward slope. 
B) has a downward slope. 
C) is a graph of the relationship between quantity demanded of a good and its price. 
D) Both answers B and C are correct. 
E) Both answers A and C are correct.

Question 14

Which of the following shifts the demand curve for movies leftward?

Accepted Answer

A) a decrease in the price of NetFlix, a substitute for movies. 
B) a decrease in the price of movie tickets. 
C) an increase in the price of movie tickets. 
D) an increase in movie star salaries. 
E) an increase in incomes, assuming movies are a normal good. 
A) a decrease in the price of NetFlix, a substitute for movies. 
B) a decrease in the price of movie tickets. 
C) an increase in the price of movie tickets. 
D) an increase in movie star salaries. 
E) an increase in incomes, assuming movies are a normal good.

Question 15

-The above figure shows the market for pizza.The market is in equilibrium when some of the pizza firms go out of business.What point represents the most likely new price and quantity?

Accepted Answer

A) A 
B) B 
C) C 
D) D 
E) E 
A) A 
B) B 
C) C 
D) D 
E) E

Question 16

EBay

Accepted Answer

A) will be considered a market when the Internet firms are profitable. 
B) is a market because buyers and sellers are brought together to buy and sell. 
C) would be a market if there was only one physical location. 
D) cannot function as a market. 
E) is not a market because buyers can buy from only one seller at any point in time. 
A) will be considered a market when the Internet firms are profitable. 
B) is a market because buyers and sellers are brought together to buy and sell. 
C) would be a market if there was only one physical location. 
D) cannot function as a market. 
E) is not a market because buyers can buy from only one seller at any point in time.

Question 17

Which of the following increases the supply of a product?

Accepted Answer

A) lower prices for the resources used to produce the product 
B) some producers going bankrupt and leaving the industry 
C) a higher price for the product 
D) an increase in the expected future price of the product 
E) a decrease in productivity 
A) lower prices for the resources used to produce the product 
B) some producers going bankrupt and leaving the industry 
C) a higher price for the product 
D) an increase in the expected future price of the product 
E) a decrease in productivity

Question 18

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 19

-The graph illustrates the market for bottled water.If the producers of bottled water switch to using improved technology, then the

Accepted Answer

A) supply of bottled water decreases. 
B) quantity demanded of bottled water increases. 
C) quantity demanded of bottled water does not change. 
D) price of bottled water rises. 
E) supply curve shifts leftward. 
A) supply of bottled water decreases. 
B) quantity demanded of bottled water increases. 
C) quantity demanded of bottled water does not change. 
D) price of bottled water rises. 
E) supply curve shifts leftward.

Question 20

Suppose that the demand curve for desktop computers shifts rightward and at the same time the supply curve shifts leftward.Which of the following could have caused these shifts?

Accepted Answer

A) Desktop computers are a normal good and incomes increased, while more firms entered the market. 
B) The price of a laptop computer, a substitute for desktop computers, fell and the cost of producing desktop computers decreased. 
C) Consumers purchased more computers because of the Christmas season and the labor costs of producing desktop computers decreased. 
D) Desktop computers are a normal good and incomes increased, while the labor costs of producing personal computers increased. 
E) Desktop computers are a normal good and incomes decreased, while the labor costs of producing personal computers increased. 
A) Desktop computers are a normal good and incomes increased, while more firms entered the market. 
B) The price of a laptop computer, a substitute for desktop computers, fell and the cost of producing desktop computers decreased. 
C) Consumers purchased more computers because of the Christmas season and the labor costs of producing desktop computers decreased. 
D) Desktop computers are a normal good and incomes increased, while the labor costs of producing personal computers increased. 
E) Desktop computers are a normal good and incomes decreased, while the labor costs of producing personal computers increased.

Suppose that the equilibrium price and quantity of new houses both increase.Which of the following could be a cause of this change?

Consider the market for smart phones.Which of the following shifts the demand curve rightward?

The price of salsa rises.How does the increase in the price of salsa affect the supply of salsa?

-Consider the market for peanut butter.If there is an increase in the price of peanuts,

What is the "quantity demanded"?

Suppose Ramen noodles, an inexpensive but a quite tasty dish, are an inferior good.Why do grocery stores in college towns, that is, towns with a large fraction of college students, stock a lot of Ramen noodles?

A demand schedule

What are substitutes in production?

What is the difference between quantity supplied and supply?

-Which of the following events will increase the quantity demanded of bottled water?

A demand curve

Which of the following shifts the demand curve for movies leftward?

-The above figure shows the market for pizza.The market is in equilibrium when some of the pizza firms go out of business.What point represents the most likely new price and quantity?

EBay

Which of the following increases the supply of a product?

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

-The graph illustrates the market for bottled water.If the producers of bottled water switch to using improved technology, then the

Suppose that the demand curve for desktop computers shifts rightward and at the same time the supply curve shifts leftward.Which of the following could have caused these shifts?

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

Suppose that the equilibrium price and quantity of new houses both increase.Which of the following could be a cause of this change?

Consider the market for smart phones.Which of the following shifts the demand curve rightward?

The price of salsa rises.How does the increase in the price of salsa affect the supply of salsa?

-Consider the market for peanut butter.If there is an increase in the price of peanuts,

What is the "quantity demanded"?

Suppose Ramen noodles, an inexpensive but a quite tasty dish, are an inferior good.Why do grocery stores in college towns, that is, towns with a large fraction of college students, stock a lot of Ramen noodles?

A demand schedule

What are substitutes in production?

What is the difference between quantity supplied and supply?

-Which of the following events will increase the quantity demanded of bottled water?

A demand curve

Which of the following shifts the demand curve for movies leftward?

-The above figure shows the market for pizza.The market is in equilibrium when some of the pizza firms go out of business.What point represents the most likely new price and quantity?

EBay

Which of the following increases the supply of a product?

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

-The graph illustrates the market for bottled water.If the producers of bottled water switch to using improved technology, then the

Suppose that the demand curve for desktop computers shifts rightward and at the same time the supply curve shifts leftward.Which of the following could have caused these shifts?

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