Question 1

The absolute price of a good is its

Accepted Answer

A) relative price. 
B) money price. 
C) subjective price. 
D) projected price. 
A) relative price. 
B) money price. 
C) subjective price. 
D) projected price.

Question 2

Which of the following will NOT affect the supply of cars?

Accepted Answer

A) an increase in the price of steel 
B) an improvement in automobile production technology 
C) an increase in the productivity of auto workers 
D) a decrease in the price of cars 
A) an increase in the price of steel 
B) an improvement in automobile production technology 
C) an increase in the productivity of auto workers 
D) a decrease in the price of cars

Question 3

Another term for the equilibrium price is

Accepted Answer

A) excess demand. 
B) nominal price. 
C) law of demand. 
D) market clearing price. 
A) excess demand. 
B) nominal price. 
C) law of demand. 
D) market clearing price.

Question 4

When the price of a good falls, there will be

Accepted Answer

A) an outward shift in the good's demand curve. 
B) both an outward shift in the good's demand curve and a movement along the good's demand curve. 
C) a movement along the good's demand curve. 
D) no change in quantity demanded. 
A) an outward shift in the good's demand curve. 
B) both an outward shift in the good's demand curve and a movement along the good's demand curve. 
C) a movement along the good's demand curve. 
D) no change in quantity demanded.

Question 5

The imposition of a per unit tax on a product

Accepted Answer

A) will cause the supply curve to shift downward and to the right. 
B) will cause the supply curve to shift upward and to the left. 
C) will reduce the quantity supplied of the product. 
D) will encourage producers to increase the quantity supplied of the product. 
A) will cause the supply curve to shift downward and to the right. 
B) will cause the supply curve to shift upward and to the left. 
C) will reduce the quantity supplied of the product. 
D) will encourage producers to increase the quantity supplied of the product.

Question 6

In deriving the demand schedule for a good, economists assume that

Accepted Answer

A) consumers have equal incomes to allocate among goods. 
B) a consumer will allocate all of her income to one good. 
C) all other influences on demand except the product price are held constant. 
D) reported income changes at each point on the demand schedule. 
A) consumers have equal incomes to allocate among goods. 
B) a consumer will allocate all of her income to one good. 
C) all other influences on demand except the product price are held constant. 
D) reported income changes at each point on the demand schedule.

Question 7

For typical goods, supply curves are

Accepted Answer

A) downward sloping. 
B) upward sloping. 
C) horizontal. 
D) vertical. 
A) downward sloping. 
B) upward sloping. 
C) horizontal. 
D) vertical.

Question 8

A change in quantity demanded

Accepted Answer

A) is a shift of the demand curve. 
B) is a movement along the demand curve. 
C) can be either a shift or a movement along the demand curve. 
D) is caused when there is a change in a ceteris paribus factor. 
A) is a shift of the demand curve. 
B) is a movement along the demand curve. 
C) can be either a shift or a movement along the demand curve. 
D) is caused when there is a change in a ceteris paribus factor.

Question 9

Suppose that, at a rental rate of $1000 per month, 650 residents wish to rent apartments and that landlords offer 800 apartments available for rent. Which one of the following statements is then TRUE?

Accepted Answer

A) There is a shortage of 150 apartments. 
B) There is an excess demand for apartments. 
C) The market clearing rental price of apartments is too low. 
D) The market clearing rental price of apartments is less than $1000 per month. 
A) There is a shortage of 150 apartments. 
B) There is an excess demand for apartments. 
C) The market clearing rental price of apartments is too low. 
D) The market clearing rental price of apartments is less than $1000 per month.

Question 10

The law of demand states that

Accepted Answer

A) consumers have unlimited demands for a good. 
B) a higher price will lead to increased sales. 
C) the price can never be too high for some consumers. 
D) quantity demanded will vary inversely with the price of the good. 
A) consumers have unlimited demands for a good. 
B) a higher price will lead to increased sales. 
C) the price can never be too high for some consumers. 
D) quantity demanded will vary inversely with the price of the good.

Question 11

A decrease in quantity demanded of a good is caused by

Accepted Answer

A) a decrease in income. 
B) a decrease in the price of a substitute. 
C) an increase in the price of the good. 
D) a change of tastes. 
A) a decrease in income. 
B) a decrease in the price of a substitute. 
C) an increase in the price of the good. 
D) a change of tastes.

Question 12

When the price of tablets goes up and fewer tablets are purchased, this is representative of the

Accepted Answer

A) law of demand. 
B) law of supply. 
C) law of market operations. 
D) law of increasing costs. 
A) law of demand. 
B) law of supply. 
C) law of market operations. 
D) law of increasing costs.

Question 13

-Refer to the above figure. Which panel demonstrates the law of supply?

Accepted Answer

A) Panel A 
B) Panel B 
C) Panel C 
D) Panel D 
A) Panel A 
B) Panel B 
C) Panel C 
D) Panel D

Question 14

Scalping and other black market activities arise when

Accepted Answer

A) the prices of goods are allowed to adjust to their equilibrium levels. 
B) the quantities of goods demanded and supplied are allowed to adjust to their equilibrium levels. 
C) the prices of goods are restricted to levels above equilibrium prices. 
D) the prices of goods are restricted to levels below equilibrium prices. 
A) the prices of goods are allowed to adjust to their equilibrium levels. 
B) the quantities of goods demanded and supplied are allowed to adjust to their equilibrium levels. 
C) the prices of goods are restricted to levels above equilibrium prices. 
D) the prices of goods are restricted to levels below equilibrium prices.

Question 15

Demand is a schedule that shows

Accepted Answer

A) a set of possible prices for a good and the quantities of the good that will be purchased at each of those prices. 
B) how much income it takes to afford various quantities of a good. 
C) the relationship between the cost of producing a good and the price that sellers will charge. 
D) how population changes will affect the amount of a good that is needed. 
A) a set of possible prices for a good and the quantities of the good that will be purchased at each of those prices. 
B) how much income it takes to afford various quantities of a good. 
C) the relationship between the cost of producing a good and the price that sellers will charge. 
D) how population changes will affect the amount of a good that is needed.

Question 16

The "real" price of a good is known as

Accepted Answer

A) the absolute price of the good. 
B) the dollar price of the good since we use dollars in the United States. 
C) relative price of the good. 
D) the price actually paid for a good instead of the sticker price. 
A) the absolute price of the good. 
B) the dollar price of the good since we use dollars in the United States. 
C) relative price of the good. 
D) the price actually paid for a good instead of the sticker price.

Question 17

An increase in price will lead to an increase in quantity supplied. This statement is

Accepted Answer

A) the law of supply. 
B) the law of demand. 
C) untrue always. 
D) a normative statement. 
A) the law of supply. 
B) the law of demand. 
C) untrue always. 
D) a normative statement.

Question 18

If bagels and croissants are substitute goods, which of the following is likely to occur if the price of bagels has decreased?

Accepted Answer

A) The demand curve for bagels shifts to the right. 
B) A leftward movement along the bagel demand curve. 
C) The demand curve for croissants shifts to the right. 
D) The demand curve for croissants shifts to the left. 
A) The demand curve for bagels shifts to the right. 
B) A leftward movement along the bagel demand curve. 
C) The demand curve for croissants shifts to the right. 
D) The demand curve for croissants shifts to the left.

Question 19

The market supply curve is found by

Accepted Answer

A) surveys of consumer groups. 
B) vertically summing up the equilibrium prices of individual firms. 
C) horizontally summing up the supply curves of individual firms. 
D) estimating what the supply curve would be of one huge firm large enough to serve the entire market. 
A) surveys of consumer groups. 
B) vertically summing up the equilibrium prices of individual firms. 
C) horizontally summing up the supply curves of individual firms. 
D) estimating what the supply curve would be of one huge firm large enough to serve the entire market.

Question 20

If the price of cotton used in making blue jeans increases, which of the following will occur?

Accepted Answer

A) There will be a movement along an unchanged supply curve for jeans. 
B) The supply curve for jeans will shift rightward. 
C) The supply curve for jeans will shift leftward. 
D) There will be a rightward shift in the supply curve for jeans, followed by a movement along the supply curve. 
A) There will be a movement along an unchanged supply curve for jeans. 
B) The supply curve for jeans will shift rightward. 
C) The supply curve for jeans will shift leftward. 
D) There will be a rightward shift in the supply curve for jeans, followed by a movement along the supply curve.

The absolute price of a good is its

Which of the following will NOT affect the supply of cars?

Another term for the equilibrium price is

When the price of a good falls, there will be

The imposition of a per unit tax on a product

In deriving the demand schedule for a good, economists assume that

For typical goods, supply curves are

A change in quantity demanded

Suppose that, at a rental rate of $1000 per month, 650 residents wish to rent apartments and that landlords offer 800 apartments available for rent. Which one of the following statements is then TRUE?

The law of demand states that

A decrease in quantity demanded of a good is caused by

When the price of tablets goes up and fewer tablets are purchased, this is representative of the

-Refer to the above figure. Which panel demonstrates the law of supply?

Scalping and other black market activities arise when

Demand is a schedule that shows

The "real" price of a good is known as

An increase in price will lead to an increase in quantity supplied. This statement is

If bagels and croissants are substitute goods, which of the following is likely to occur if the price of bagels has decreased?

The market supply curve is found by

If the price of cotton used in making blue jeans increases, which of the following will occur?

The Nature of Economics

Scarcity and the World of Trade-Offs

Extensions of Demand and Supply Analysis

Public Spending and Public Choice

Funding the Public Sector

The Macroeconomy: Unemployment, Inflation, and Deflation

Global Economic Growth and Development

Real GDP and the Price Level in the Long Run

Classical and Keynesian Macro Analyses

Consumption, Real GDP, and the Multiplier

Fiscal Policy

Deficit Spending and the Public Debt

Money Banking and Central Banking

Domestic and International Dimensions of Monetary Policy

Stabilization in an Integrated World Economy

Policies and Prospects for Global Economic Growth

Comparative Advantage and the Open Economy

Exchange Rates and the Balance of Payments

Filters

Exam 3: Demand and Supply

The absolute price of a good is its

Which of the following will NOT affect the supply of cars?

Another term for the equilibrium price is

When the price of a good falls, there will be

The imposition of a per unit tax on a product

In deriving the demand schedule for a good, economists assume that

For typical goods, supply curves are

A change in quantity demanded

Suppose that, at a rental rate of $1000 per month, 650 residents wish to rent apartments and that landlords offer 800 apartments available for rent. Which one of the following statements is then TRUE?

The law of demand states that

A decrease in quantity demanded of a good is caused by

When the price of tablets goes up and fewer tablets are purchased, this is representative of the

-Refer to the above figure. Which panel demonstrates the law of supply?

Scalping and other black market activities arise when

Demand is a schedule that shows

The "real" price of a good is known as

An increase in price will lead to an increase in quantity supplied. This statement is

If bagels and croissants are substitute goods, which of the following is likely to occur if the price of bagels has decreased?

The market supply curve is found by

If the price of cotton used in making blue jeans increases, which of the following will occur?

The Nature of Economics

Scarcity and the World of Trade-Offs

Extensions of Demand and Supply Analysis

Public Spending and Public Choice

Funding the Public Sector

The Macroeconomy: Unemployment, Inflation, and Deflation

Global Economic Growth and Development

Real GDP and the Price Level in the Long Run

Classical and Keynesian Macro Analyses

Consumption, Real GDP, and the Multiplier

Fiscal Policy

Deficit Spending and the Public Debt

Money Banking and Central Banking

Domestic and International Dimensions of Monetary Policy

Stabilization in an Integrated World Economy

Policies and Prospects for Global Economic Growth

Comparative Advantage and the Open Economy

Exchange Rates and the Balance of Payments

Filters