Question 1

As the price of flour (an input in the production of cookies)increases, firms that produce cookies will:

Accepted Answer

A) increase the supply of cookies. 
B) increase the quantity of cookies supplied. 
C) decrease the supply of cookies. 
D) decrease the quantity of cookies supplied. 
A) increase the supply of cookies. 
B) increase the quantity of cookies supplied. 
C) decrease the supply of cookies. 
D) decrease the quantity of cookies supplied.

Question 2

Refer to the given table. Relative to column A, column B represents: $$\begin{array} { | r | r | r | } 
\hline \text { Price Per Unit } & \text { Columu A Units Per Year } & \text { Colum B Units Per Year } \
\hline \$ 20 & 100 & 110 \
\hline \$ 30 & 85 & 95 \
\hline \$ 40 & 70 & \mathbf { 8 0 } \
\hline \$ 50 & 55 & 65 \
\hline \$ 60 & 40 & 50 \
\hline
\end{array}$$

Accepted Answer

A) a decrease in demand. 
B) an increase in demand. 
C) a decrease in supply. 
D) an increase in supply. 
A) a decrease in demand. 
B) an increase in demand. 
C) a decrease in supply. 
D) an increase in supply.

Question 3

Suppose supply decreases, but there is no change in demand. As the market reaches its new equilibrium:

Accepted Answer

A) excess demand will lead the price to rise. 
B) excess supply will lead the price to rise. 
C) excess demand will lead the price to fall. 
D) excess supply will lead the price to fall. 
A) excess demand will lead the price to rise. 
B) excess supply will lead the price to rise. 
C) excess demand will lead the price to fall. 
D) excess supply will lead the price to fall.

Question 4

If the demand for gadgets increases as a result of a decrease in the price of widgets, the widgets and gadgets are:

Accepted Answer

A) complementary goods. 
B) substitute goods. 
C) normal goods. 
D) elastically demanded. 
A) complementary goods. 
B) substitute goods. 
C) normal goods. 
D) elastically demanded.

Question 5

A decrease in both the equilibrium price and the equilibrium quantity of rice is best explained by:

Accepted Answer

A) an increase in the demand for rice. 
B) an increase in the supply of rice. 
C) a decrease in the supply of rice. 
D) a decrease in the demand for rice. 
A) an increase in the demand for rice. 
B) an increase in the supply of rice. 
C) a decrease in the supply of rice. 
D) a decrease in the demand for rice.

Question 6

A market equilibrium:

Accepted Answer

A) leaves unexploited opportunities for individuals. 
B) maximizes total economic surplus. 
C) exploits all gains achievable through collective action. 
D) leaves no unexploited opportunities for individuals. 
A) leaves unexploited opportunities for individuals. 
B) maximizes total economic surplus. 
C) exploits all gains achievable through collective action. 
D) leaves no unexploited opportunities for individuals.

Question 7

Refer to the given table. $$\begin{array} { | r | r | r | } 
\hline \text { Price Per Unit } & \text { Columu A Units Per Year } & \text { Colum B Units Per Year } \
\hline \$ 40 & 110 & 40 \
\hline \$ 45 & 95 & 50 \
\hline \$ 50 & 80 & 60 \
\hline \$ 55 & 65 & 70 \
\hline \$ 60 & 50 & \mathbf { 8 0 } \
\hline
\end{array}$$  
Suppose the columns in this table reflect demand and supply. If the current market price is $50, then you would expect:

Accepted Answer

A) the market price to fall. 
B) the market price to rise. 
C) demand to decrease and supply to decrease. 
D) supply to decrease. 
A) the market price to fall. 
B) the market price to rise. 
C) demand to decrease and supply to decrease. 
D) supply to decrease.

Question 8

The quantity that sellers wish to sell tends to ________ as price increases, and so the supply curve is ________ sloping.

Accepted Answer

A) increase; downward 
B) decrease; downward 
C) increase; upward 
D) decrease; upward 
A) increase; downward 
B) decrease; downward 
C) increase; upward 
D) decrease; upward

Question 9

It is likely that for most people:

Accepted Answer

A) coffee and tea are substitutes. 
B) coffee and non-dairy creamer are substitutes. 
C) coffee and Coke are complements. 
D) coffee and coffee mugs are substitutes. 
A) coffee and tea are substitutes. 
B) coffee and non-dairy creamer are substitutes. 
C) coffee and Coke are complements. 
D) coffee and coffee mugs are substitutes.

Question 10

The market equilibrium quantity:

Accepted Answer

A) maximizes total economic surplus. 
B) is sometimes the socially optimal quantity. 
C) is the socially optimal quantity. 
D) is not the socially optimal quantity. 
A) maximizes total economic surplus. 
B) is sometimes the socially optimal quantity. 
C) is the socially optimal quantity. 
D) is not the socially optimal quantity.

Question 11

Which of the following is NOT a characteristic of rent controls?

Accepted Answer

A) Greater availability of apartments 
B) Excess demand for apartments 
C) Fewer newly built apartment buildings 
D) Lower expenditures on maintenance 
A) Greater availability of apartments 
B) Excess demand for apartments 
C) Fewer newly built apartment buildings 
D) Lower expenditures on maintenance

Question 12

The price of bananas will increase in response to:

Accepted Answer

A) an excess supply of bananas. 
B) an excess demand for bananas. 
C) an increase quantity of bananas supplied. 
D) an increase in the supply of bananas. 
A) an excess supply of bananas. 
B) an excess demand for bananas. 
C) an increase quantity of bananas supplied. 
D) an increase in the supply of bananas.

Question 13

Refer to the accompanying figure. Moving from demand curve D1 to demand curve D2 could be caused by a(n):

Accepted Answer

A) decrease in the product's expected future price. 
B) increase in quantity supplied. 
C) increase in the price of a close substitute. 
D) increase in the price of a complement. 
A) decrease in the product's expected future price. 
B) increase in quantity supplied. 
C) increase in the price of a close substitute. 
D) increase in the price of a complement.

Question 14

The supply curve illustrates that firms:

Accepted Answer

A) increase the supply of a good when its price rises. 
B) increase the quantity supplied of a good when its price rises. 
C) decrease the quantity supplied of a good when input prices rise. 
D) decrease the supply of a good when its price rises. 
A) increase the supply of a good when its price rises. 
B) increase the quantity supplied of a good when its price rises. 
C) decrease the quantity supplied of a good when input prices rise. 
D) decrease the supply of a good when its price rises.

Question 15

Suppose that Tom bought a bike from Helen for $195. If Helen's reservation price was $185, and Tom's reservation price was $215, the buyer's surplus from this transaction was:

Accepted Answer

A) $195 
B) $10 
C) $20 
D) $215 
A) $195 
B) $10 
C) $20 
D) $215

Question 16

Refer to the accompanying figure. The equilibrium price is ________, and the equilibrium quantity is ________.

Accepted Answer

A) $8; 6 
B) $6; 4 
C) $4; 6 
D) $2; 8 
A) $8; 6 
B) $6; 4 
C) $4; 6 
D) $2; 8

Question 17

If demand increases and supply decreases, the change in the equilibrium price will be ________, and the change in the equilibrium quantity will be ________.

Accepted Answer

A) positive; positive 
B) positive; negative 
C) positive; uncertain 
D) uncertain; positive 
A) positive; positive 
B) positive; negative 
C) positive; uncertain 
D) uncertain; positive

Question 18

As the price of cookies increases, firms that produce cookies will:

Accepted Answer

A) increase the supply of cookies. 
B) increase the quantity of cookies supplied. 
C) decrease the supply of cookies. 
D) decrease the quantity of cookies supplied. 
A) increase the supply of cookies. 
B) increase the quantity of cookies supplied. 
C) decrease the supply of cookies. 
D) decrease the quantity of cookies supplied.

Question 19

Buyers and sellers of a particular good make up the:

Accepted Answer

A) market for the good. 
B) demand for the good. 
C) supply for the good. 
D) production possibilities curve for the good. 
A) market for the good. 
B) demand for the good. 
C) supply for the good. 
D) production possibilities curve for the good.

Question 20

Refer to the accompanying figure. Assume the market is originally at point W. Movement to point Z is a combination of:

Accepted Answer

A) an increase in demand and an increase in quantity supplied. 
B) an increase in supply and an increase in demand. 
C) an increase in supply and an increase in quantity demanded. 
D) a decrease in supply and an increase in quantity demanded. 
A) an increase in demand and an increase in quantity supplied. 
B) an increase in supply and an increase in demand. 
C) an increase in supply and an increase in quantity demanded. 
D) a decrease in supply and an increase in quantity demanded.

Exam 3: Supply and Demand

As the price of flour (an input in the production of cookies)increases, firms that produce cookies will:

Refer to the given table. Relative to column A, column B represents: Price Per Unit Columu A Units Per Year Colum B Units Per Year \ 20 100 110 \ 30 85 95 \ 40 70 \ 50 55 65 \ 60 40 50

Suppose supply decreases, but there is no change in demand. As the market reaches its new equilibrium:

If the demand for gadgets increases as a result of a decrease in the price of widgets, the widgets and gadgets are:

A decrease in both the equilibrium price and the equilibrium quantity of rice is best explained by:

A market equilibrium:

Refer to the given table. Price Per Unit Columu A Units Per Year Colum B Units Per Year \ 40 110 40 \ 45 95 50 \ 50 80 60 \ 55 65 70 \ 60 50 Suppose the columns in this table reflect demand and supply. If the current market price is $50, then you would expect:

The quantity that sellers wish to sell tends to ________ as price increases, and so the supply curve is ________ sloping.

It is likely that for most people:

The market equilibrium quantity:

Which of the following is NOT a characteristic of rent controls?

The price of bananas will increase in response to:

Refer to the accompanying figure. Moving from demand curve D1 to demand curve D2 could be caused by a(n):

The supply curve illustrates that firms:

Suppose that Tom bought a bike from Helen for $195. If Helen's reservation price was $185, and Tom's reservation price was $215, the buyer's surplus from this transaction was:

Refer to the accompanying figure. The equilibrium price is ________, and the equilibrium quantity is ________.

If demand increases and supply decreases, the change in the equilibrium price will be ________, and the change in the equilibrium quantity will be ________.

As the price of cookies increases, firms that produce cookies will:

Buyers and sellers of a particular good make up the:

Refer to the accompanying figure. Assume the market is originally at point W. Movement to point Z is a combination of:

Thinking Like an Economist

Comparative Advantage

Elasticity

Demand

Perfectly Competitive Supply

Efficiency, Exchange, and the Invisible Hand in Action

Monopoly, Oligopoly, and Monopolistic Competition

Games and Strategic Behavior

An Introduction to Behavioral Economics

Externalities, Property Rights, and the Environment

The Economics of Information

Labor Markets, Poverty, and Income Distribution

Public Goods and Tax Policy

International Trade and Trade Policy

Macroeconomics: The Birds Eye View of the Economy

Measuring Economic Activity: GDP and Unemployment

Measuring the Price Level and Inflation

Economic Growth, Productivity, and Living Standards

The Labor Market: Workers, Wages, and Unemployment

Saving and Capital Formation

Money Prices and the Federal Reserve

Financial Markets and International Capital Flows

Short-Term Economic Fluctuations: An Introduction

Spending and Output in the Short Run

Stabilizing the Economy: The Role of the Fed

Aggregate Demand, Aggregate Supply, and Inflation

Exchange Rates and the Open Economy

Filters

The quantity that sellers wish to sell tends to as price increases, and so the supply curve is sloping.

Refer to the accompanying figure. The equilibrium price is , and the equilibrium quantity is .

If demand increases and supply decreases, the change in the equilibrium price will be , and the change in the equilibrium quantity will be .