Question 1

Which of the following would shift the demand curve for gasoline to the right?

Accepted Answer

A) a decrease in the price of gasoline 
B) an increase in consumer income, assuming gasoline is a normal good 
C) an increase in the price of cars, a complement for gasoline 
D) a decrease in the expected future price of gasoline 
A) a decrease in the price of gasoline 
B) an increase in consumer income, assuming gasoline is a normal good 
C) an increase in the price of cars, a complement for gasoline 
D) a decrease in the expected future price of gasoline

Question 2

When the price of a good or service changes,

Accepted Answer

A) the supply curve shifts in the opposite direction. 
B) the demand curve shifts in the opposite direction. 
C) the demand curve shifts in the same direction. 
D) there is a movement along a given demand curve. 
A) the supply curve shifts in the opposite direction. 
B) the demand curve shifts in the opposite direction. 
C) the demand curve shifts in the same direction. 
D) there is a movement along a given demand curve.

Question 3

If suppliers expect the price of their product to fall in the future, then they will

Accepted Answer

A) decrease supply now. 
B) increase supply now. 
C) decrease supply in the future but not now. 
D) increase supply in the future but not now. 
A) decrease supply now. 
B) increase supply now. 
C) decrease supply in the future but not now. 
D) increase supply in the future but not now.

Question 4

Figure 4-9  
-Refer to Figure 4-9. The movement from point A to point B on the graph is 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 5

When quantity demanded increases at every possible price, the demand curve has

Accepted Answer

A) shifted to the left. 
B) shifted to the right. 
C) not shifted; rather, we have moved along the demand curve to a new point on the same curve. 
D) not shifted; rather, the demand curve has become steeper. 
A) shifted to the left. 
B) shifted to the right. 
C) not shifted; rather, we have moved along the demand curve to a new point on the same curve. 
D) not shifted; rather, the demand curve has become steeper.

Question 6

A decrease in the price of baseball bats will decrease the demand for baseballs.

Accepted Answer

A) True 
 B)False

Question 7

Figure 4-15  
-Refer to Figure 4-15. At a price of $15, there would be a

Accepted Answer

A) surplus of 400 units. 
B) shortage of 200 units. 
C) shortage of 400 units. 
D) shortage of 600 units. 
A) surplus of 400 units. 
B) shortage of 200 units. 
C) shortage of 400 units. 
D) shortage of 600 units.

Question 8

In a competitive market, the price of a product

Accepted Answer

A) is determined by buyers, and the quantity of the product produced is determined by sellers. 
B) is determined by sellers, and the quantity of the product produced is determined by buyers. 
C) and the quantity of the product produced are both determined by sellers. 
D) None of the above is correct. 
A) is determined by buyers, and the quantity of the product produced is determined by sellers. 
B) is determined by sellers, and the quantity of the product produced is determined by buyers. 
C) and the quantity of the product produced are both determined by sellers. 
D) None of the above is correct.

Question 9

What will happen to the equilibrium price of new textbooks if more students attend college, 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) The price change will be ambiguous. 
A) Price will rise. 
B) Price will fall. 
C) Price will stay exactly the same. 
D) The price change will be ambiguous.

Question 10

Figure 4-9  
-Refer to Figure 4-9. The movement from point A to point B on the graph is caused by

Accepted Answer

A) a decrease in the price of the good. 
B) an increase in the price of the good. 
C) an advance in production technology. 
D) a decrease in input prices. 
A) a decrease in the price of the good. 
B) an increase in the price of the good. 
C) an advance in production technology. 
D) a decrease in input prices.

Question 11

In a perfectly competitive market, the goods offered for sale are all exactly the same.

Accepted Answer

A) True 
 B)False

Question 12

Cocoa and marshmallows are complements, so a decrease in the price of cocoa will cause an increase in the demand for marshmallows.

Accepted Answer

A) True 
 B)False

Question 13

When Mario's income decreases, he buys more pasta. For Mario, pasta is a normal good.

Accepted Answer

A) True 
 B)False

Question 14

Table 4-9
The demand schedule below pertains to sandwiches demanded per week. $$\begin{array} { | c | c | c | c | } 
\hline \text { Price } & \begin{array} { c } 
\text { Harry's } \
\text { Quantity } \
\text { Demanded }
\end{array} & \begin{array} { c } 
\text { Darby's } \
\text { Quantity } \
\text { Denanded }
\end{array} & \begin{array} { c } 
\text { Jake's } \
\text { Quantity } \
\text { Denanded }
\end{array} \
\hline \$ 3 & 3 & 4 & 3 \
\hline \$ 5 & 1 & 2 & x \
\hline
\end{array}$$
-Refer to Table 4-9. Suppose x = 1. Then it must be true that

Accepted Answer

A) Harry and Jake have the same income, which is lower than Darby's income. 
B) if sandwiches and potato chips are complements for Harry, then those two goods are also complements for Jake. 
C) Harry's demand curve is identical to Jake's demand curve. 
D) All of the above are correct. 
A) Harry and Jake have the same income, which is lower than Darby's income. 
B) if sandwiches and potato chips are complements for Harry, then those two goods are also complements for Jake. 
C) Harry's demand curve is identical to Jake's demand curve. 
D) All of the above are correct.

Question 15

Monopolists are price takers.

Accepted Answer

A) True 
 B)False

Question 16

Today, producers changed their expectations about the future. This change

Accepted Answer

A) can cause a movement along a supply curve. 
B) can affect future supply, but not today's supply. 
C) can affect today's supply. 
D) cannot affect either today's supply or future supply. 
A) can cause a movement along a supply curve. 
B) can affect future supply, but not today's supply. 
C) can affect today's supply. 
D) cannot affect either today's supply or future supply.

Question 17

Figure 4-14  
-Refer to Figure 4-14. At a price of

Accepted Answer

A) $8, there is a surplus of 6 units. 
B) $5, there is neither a shortage nor a surplus. 
C) $2, there is a shortage of 6 units. 
D) All of the above are correct. 
A) $8, there is a surplus of 6 units. 
B) $5, there is neither a shortage nor a surplus. 
C) $2, there is a shortage of 6 units. 
D) All of the above are correct.

Question 18

Figure 4-9  
-Refer to Figure 4-9. The movement from point A to point B on the graph represents

Accepted Answer

A) an increased willingness and ability on the part of suppliers to supply the good at each possible price. 
B) an increase in the number of suppliers. 
C) a decrease in the price of a relevant input. 
D) an increase in the price of the good that is being supplied and the suppliers' responses to that price change. 
A) an increased willingness and ability on the part of suppliers to supply the good at each possible price. 
B) an increase in the number of suppliers. 
C) a decrease in the price of a relevant input. 
D) an increase in the price of the good that is being supplied and the suppliers' responses to that price change.

Question 19

A decrease in demand is represented by a

Accepted Answer

A) movement downward and to the right along a demand curve. 
B) movement upward and to the left along a demand curve. 
C) rightward shift of a demand curve. 
D) leftward shift of a demand curve. 
A) movement downward and to the right along a demand curve. 
B) movement upward and to the left along a demand curve. 
C) rightward shift of a demand curve. 
D) leftward shift of a demand curve.

Question 20

At the equilibrium price, the quantity of the good that buyers are willing and able to buy

Accepted Answer

A) is greater than the quantity that sellers are willing and able to sell. 
B) exactly equals the quantity that sellers are willing and able to sell. 
C) is less than the quantity that sellers are willing and able to sell. 
D) Either a) or c) could be correct. 
A) is greater than the quantity that sellers are willing and able to sell. 
B) exactly equals the quantity that sellers are willing and able to sell. 
C) is less than the quantity that sellers are willing and able to sell. 
D) Either a) or c) could be correct.

Exam 4: The Market Forces of Supply and Demand

Which of the following would shift the demand curve for gasoline to the right?

When the price of a good or service changes,

If suppliers expect the price of their product to fall in the future, then they will

Figure 4-9 -Refer to Figure 4-9. The movement from point A to point B on the graph is called

When quantity demanded increases at every possible price, the demand curve has

A decrease in the price of baseball bats will decrease the demand for baseballs.

Figure 4-15 -Refer to Figure 4-15. At a price of $15, there would be a

In a competitive market, the price of a product

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

Figure 4-9 -Refer to Figure 4-9. The movement from point A to point B on the graph is caused by

In a perfectly competitive market, the goods offered for sale are all exactly the same.

Cocoa and marshmallows are complements, so a decrease in the price of cocoa will cause an increase in the demand for marshmallows.

When Mario's income decreases, he buys more pasta. For Mario, pasta is a normal good.

Table 4-9 The demand schedule below pertains to sandwiches demanded per week. Price Harry's Quantity Demanded Darby's Quantity Denanded Jake's Quantity Denanded \ 3 3 4 3 \ 5 1 2 x -Refer to Table 4-9. Suppose x = 1. Then it must be true that

Monopolists are price takers.

Today, producers changed their expectations about the future. This change

Figure 4-14 -Refer to Figure 4-14. At a price of

Figure 4-9 -Refer to Figure 4-9. The movement from point A to point B on the graph represents

A decrease in demand is represented by a

At the equilibrium price, the quantity of the good that buyers are willing and able to buy

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

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

The Basic Tools of Finance

Unemployment

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomic Models

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Trade-Off Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

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