Question 1

A changes in which of the following shifts the demand curve for hamburgers?

Accepted Answer

A)  an increase in the price of the meat used to produce hamburgers 
B)  an increase in the price of a hamburger 
C)  a fall in the price of french fries, a complement for hamburgers 
D)  an increase in the number of hamburger restaurants 
A)  an increase in the price of the meat used to produce hamburgers 
B)  an increase in the price of a hamburger 
C)  a fall in the price of french fries, a complement for hamburgers 
D)  an increase in the number of hamburger restaurants

Question 2

Which of the following increases the equilibrium price of a used car and decreases the equilibrium quantity?

Accepted Answer

A)  an announcement by the U.S. Attorney General that the windows on older cars were made with cheaper glass that can explode at high speeds 
B)  new federal legislation that raises the legal driving age to twenty-four in all states 
C)  a new fee that used car dealers must pay to the government on all sales of used cars 
D)  all of the above because each is consistent with the "law of demand" 
A)  an announcement by the U.S. Attorney General that the windows on older cars were made with cheaper glass that can explode at high speeds 
B)  new federal legislation that raises the legal driving age to twenty-four in all states 
C)  a new fee that used car dealers must pay to the government on all sales of used cars 
D)  all of the above because each is consistent with the "law of demand"

Question 3

In 2006, the base price of a Hummer SUV was about $30,000. By 2008 as gasoline prices increased,

Accepted Answer

A)  the demand curve for Hummers shifted leftward and Hummer prices decreased. 
B)  the demand curve for Hummers shifted rightward and Hummer prices increased. 
C)  there was a movement down along the Hummer demand curve. 
D)  there was a movement up along the Hummer supply curve. 
A)  the demand curve for Hummers shifted leftward and Hummer prices decreased. 
B)  the demand curve for Hummers shifted rightward and Hummer prices increased. 
C)  there was a movement down along the Hummer demand curve. 
D)  there was a movement up along the Hummer supply curve.

Question 4

The equilibrium price will rise and the equilibrium quantity might increase, decrease, or stay the same when the

Accepted Answer

A)  demand and the supply of a good both increase. 
B)  demand for a good increases and the supply of it decreases. 
C)  demand for a good decreases and the supply of it increases. 
D)  demand and the supply of a good both decrease. 
A)  demand and the supply of a good both increase. 
B)  demand for a good increases and the supply of it decreases. 
C)  demand for a good decreases and the supply of it increases. 
D)  demand and the supply of a good both decrease.

Question 5

-The above figures show the market for oranges. Which figure(s) shows the effect of existing orange growers increasing the size of their orange groves?

Accepted Answer

A)  Figures A and C 
B)  Figures B and D 
C)  Figure A 
D)  Figure D 
A)  Figures A and C 
B)  Figures B and D 
C)  Figure A 
D)  Figure D

Question 6

-The figure illustrates the market for pens. The equilibrium quantity is

Accepted Answer

A)  between 400 and 600 pens, but it is impossible to be precise. 
B)  5 pens a month. 
C)  2 pens a month. 
D)  500 pens a month. 
A)  between 400 and 600 pens, but it is impossible to be precise. 
B)  5 pens a month. 
C)  2 pens a month. 
D)  500 pens a month.

Question 7

Which of the following pairs of goods are most likely substitutes?

Accepted Answer

A)  DVDs and DVD players 
B)  cola and lemon lime soda 
C)  lettuce and salad dressing 
D)  peanut butter and gasoline 
A)  DVDs and DVD players 
B)  cola and lemon lime soda 
C)  lettuce and salad dressing 
D)  peanut butter and gasoline

Question 8

An increase in demand combined with no change in supply

Accepted Answer

A)  raises the equilibrium price. 
B)  lowers the equilibrium price. 
C)  results in only a movement rightward along the demand curve. 
D)  decreases demand because the supply curve does not shift. 
A)  raises the equilibrium price. 
B)  lowers the equilibrium price. 
C)  results in only a movement rightward along the demand curve. 
D)  decreases demand because the supply curve does not shift.

Question 9

If the equilibrium price for a two-liter bottle of Coca-Cola is $1.50 today, just like it was ten years ago, can we safely say that all supply and demand conditions in the market for Coke have remained very stable all these years?

Accepted Answer

Not necessarily. The demand curve might

Question 10

-The table gives the demand and supply schedules for boat rides. If the supply of boat rides increases by 20 rides a day, the price will ________.

Accepted Answer

A)  remain unchanged 
B)  fall to $6 a ride 
C)  rise to $6 a ride 
D)  rise to $10 a ride 
A)  remain unchanged 
B)  fall to $6 a ride 
C)  rise to $6 a ride 
D)  rise to $10 a ride

Question 11

What is the effect on the price and quantity of wooden desks of a rise in the price of wood?

Accepted Answer

A)  The equilibrium quantity of wooden desks increases and the equilibrium price falls. 
B)  The equilibrium quantity of wooden desks increases and the equilibrium price rises. 
C)  The equilibrium quantity of wooden desks decreases and the equilibrium price falls. 
D)  The equilibrium quantity of wooden desks decreases and the equilibrium price rises. 
A)  The equilibrium quantity of wooden desks increases and the equilibrium price falls. 
B)  The equilibrium quantity of wooden desks increases and the equilibrium price rises. 
C)  The equilibrium quantity of wooden desks decreases and the equilibrium price falls. 
D)  The equilibrium quantity of wooden desks decreases and the equilibrium price rises.

Question 12

Consider the market for broccoli. If the price of a pound of broccoli increases, what happens to the supply of broccoli?

Accepted Answer

A)  The supply of broccoli decreases. 
B)  The supply of broccoli increases. 
C)  There will be no change in the supply of broccoli, but instead there is an increase in the quantity supplied of broccoli. 
D)  There will be no change in the supply of broccoli, but instead there is a decrease in the quantity supplied of broccoli. 
A)  The supply of broccoli decreases. 
B)  The supply of broccoli increases. 
C)  There will be no change in the supply of broccoli, but instead there is an increase in the quantity supplied of broccoli. 
D)  There will be no change in the supply of broccoli, but instead there is a decrease in the quantity supplied of broccoli.

Question 13

The law of demand states that the quantity of a good demanded varies

Accepted Answer

A)  inversely with its price. 
B)  inversely with the price of substitute goods. 
C)  directly with income. 
D)  directly with population. 
A)  inversely with its price. 
B)  inversely with the price of substitute goods. 
C)  directly with income. 
D)  directly with population.

Question 14

In the market for bicycles, explain what happens to the supply and demand curves when there is an increase in the price of steel used to make bikes.

Accepted Answer

An increase in the price of steel is an

Question 15

A surplus occurs when the price is

Accepted Answer

A)  less than the equilibrium price. 
B)  equal to the equilibrium price. 
C)  greater than the equilibrium price. 
D)  None of the above because the existence of a surplus is independent of the price of the good. 
A)  less than the equilibrium price. 
B)  equal to the equilibrium price. 
C)  greater than the equilibrium price. 
D)  None of the above because the existence of a surplus is independent of the price of the good.

Question 16

-The above figures show the market for hamburger meat. Which figure(s) shows the effect of a decrease in the price of a hamburger complement such as hamburger buns?

Accepted Answer

A)  Figure A 
B)  Figure B 
C)  Figure D 
D)  Figures A and B 
A)  Figure A 
B)  Figure B 
C)  Figure D 
D)  Figures A and B

Question 17

If the U.S. Surgeon General announced that increased grapefruit juice consumption could help prevent heart attacks, what would happen to the equilibrium price and quantity of grapefruit juice?

Accepted Answer

A)  Price and quantity both increase. 
B)  Price and quantity both decrease. 
C)  Price increases but quantity decreases. 
D)  Price decreases but quantity increases. 
A)  Price and quantity both increase. 
B)  Price and quantity both decrease. 
C)  Price increases but quantity decreases. 
D)  Price decreases but quantity increases.

Question 18

-Consider the demand curves for soft drinks shown in the figure above. Suppose the economy is at point a. Which of the following could result in a movement to point d?

Accepted Answer

A)  a decrease in income 
B)  an increase in the relative price of a soft drink 
C)  a decrease in the relative price of a soft drink 
D)  a decrease in the price of bottled water 
A)  a decrease in income 
B)  an increase in the relative price of a soft drink 
C)  a decrease in the relative price of a soft drink 
D)  a decrease in the price of bottled water

Question 19

Apples are a normal good, so if the price of an apple increases from 50¢ to 60¢, the quantity of apples demanded decrease because of

Accepted Answer

A)  the substitution effect only. 
B)  the income effect only. 
C)  a change in income. 
D)  the substitution and income effects. 
A)  the substitution effect only. 
B)  the income effect only. 
C)  a change in income. 
D)  the substitution and income effects.

Question 20

A decrease in the demand for beef because of concerns over cholesterol results in

Accepted Answer

A)  lower beef prices. 
B)  higher beef prices. 
C)  an increase in the supply of beef. 
D)  an offsetting increase in the demand for beef if the price of beef falls. 
A)  lower beef prices. 
B)  higher beef prices. 
C)  an increase in the supply of beef. 
D)  an offsetting increase in the demand for beef if the price of beef falls.

A changes in which of the following shifts the demand curve for hamburgers?

Which of the following increases the equilibrium price of a used car and decreases the equilibrium quantity?

In 2006, the base price of a Hummer SUV was about $30,000. By 2008 as gasoline prices increased,

The equilibrium price will rise and the equilibrium quantity might increase, decrease, or stay the same when the

-The above figures show the market for oranges. Which figure(s) shows the effect of existing orange growers increasing the size of their orange groves?

-The figure illustrates the market for pens. The equilibrium quantity is

Which of the following pairs of goods are most likely substitutes?

An increase in demand combined with no change in supply

If the equilibrium price for a two-liter bottle of Coca-Cola is $1.50 today, just like it was ten years ago, can we safely say that all supply and demand conditions in the market for Coke have remained very stable all these years?

-The table gives the demand and supply schedules for boat rides. If the supply of boat rides increases by 20 rides a day, the price will ________.

What is the effect on the price and quantity of wooden desks of a rise in the price of wood?

Consider the market for broccoli. If the price of a pound of broccoli increases, what happens to the supply of broccoli?

The law of demand states that the quantity of a good demanded varies

In the market for bicycles, explain what happens to the supply and demand curves when there is an increase in the price of steel used to make bikes.

A surplus occurs when the price is

-The above figures show the market for hamburger meat. Which figure(s) shows the effect of a decrease in the price of a hamburger complement such as hamburger buns?

If the U.S. Surgeon General announced that increased grapefruit juice consumption could help prevent heart attacks, what would happen to the equilibrium price and quantity of grapefruit juice?

-Consider the demand curves for soft drinks shown in the figure above. Suppose the economy is at point a. Which of the following could result in a movement to point d?

Apples are a normal good, so if the price of an apple increases from 50¢ to 60¢, the quantity of apples demanded decrease because of

A decrease in the demand for beef because of concerns over cholesterol results in

What Is Economics

The Economic Problem

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, Preferences, and Choices

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Public Choices, Public Goods, and Healthcare

Externalities

Markets for Factors of Production

Economic Inequality

Uncertainty and Information

Filters

Exam 3: Demand and Supply

A changes in which of the following shifts the demand curve for hamburgers?

Which of the following increases the equilibrium price of a used car and decreases the equilibrium quantity?

In 2006, the base price of a Hummer SUV was about $30,000. By 2008 as gasoline prices increased,

The equilibrium price will rise and the equilibrium quantity might increase, decrease, or stay the same when the

-The above figures show the market for oranges. Which figure(s) shows the effect of existing orange growers increasing the size of their orange groves?

-The figure illustrates the market for pens. The equilibrium quantity is

Which of the following pairs of goods are most likely substitutes?

An increase in demand combined with no change in supply

If the equilibrium price for a two-liter bottle of Coca-Cola is $1.50 today, just like it was ten years ago, can we safely say that all supply and demand conditions in the market for Coke have remained very stable all these years?

-The table gives the demand and supply schedules for boat rides. If the supply of boat rides increases by 20 rides a day, the price will ________.

What is the effect on the price and quantity of wooden desks of a rise in the price of wood?

Consider the market for broccoli. If the price of a pound of broccoli increases, what happens to the supply of broccoli?

The law of demand states that the quantity of a good demanded varies

In the market for bicycles, explain what happens to the supply and demand curves when there is an increase in the price of steel used to make bikes.

A surplus occurs when the price is

-The above figures show the market for hamburger meat. Which figure(s) shows the effect of a decrease in the price of a hamburger complement such as hamburger buns?

If the U.S. Surgeon General announced that increased grapefruit juice consumption could help prevent heart attacks, what would happen to the equilibrium price and quantity of grapefruit juice?

-Consider the demand curves for soft drinks shown in the figure above. Suppose the economy is at point a. Which of the following could result in a movement to point d?

Apples are a normal good, so if the price of an apple increases from 50¢ to 60¢, the quantity of apples demanded decrease because of

A decrease in the demand for beef because of concerns over cholesterol results in

What Is Economics

The Economic Problem

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, Preferences, and Choices

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Public Choices, Public Goods, and Healthcare

Externalities

Markets for Factors of Production

Economic Inequality

Uncertainty and Information

Filters