Question 1

What is the effect on the price and quantity of a product if both the demand and supply simultaneously increase?

Accepted Answer

The equilibrium quantity unambiguously i

Question 2

The "law of demand" predicts that, other things being equal

Accepted Answer

A)  an increase in the price of downloaded music decreases the demand for downloaded music. 
B)  a decrease in the price of gasoline decreases the quantity of gasoline demanded. 
C)  an increase in the price of pizza decreases the quantity of pizza demanded. 
D)  an increase in the price of coffee decreases the quantity of tea demanded. 
A)  an increase in the price of downloaded music decreases the demand for downloaded music. 
B)  a decrease in the price of gasoline decreases the quantity of gasoline demanded. 
C)  an increase in the price of pizza decreases the quantity of pizza demanded. 
D)  an increase in the price of coffee decreases the quantity of tea demanded.

Question 3

The law of demand concludes that a rise in the price of a golf ball ________ the quantity demanded and ________.

Accepted Answer

A)  increases; shifts the demand curve for golf balls rightward 
B)  decreases; shifts the demand curve for golf balls leftward 
C)  decreases; creates a movement up along the demand curve for golf balls 
D)  increases; creates a movement down along the demand curve for golf balls 
A)  increases; shifts the demand curve for golf balls rightward 
B)  decreases; shifts the demand curve for golf balls leftward 
C)  decreases; creates a movement up along the demand curve for golf balls 
D)  increases; creates a movement down along the demand curve for golf balls

Question 4

If the price of a CD is equal to the equilibrium price, there will be ________ of CDs and the price will ________.

Accepted Answer

A)  surplus; rise 
B)  surplus; fall 
C)  shortage; fall 
D)  neither a shortage nor surplus; not change 
A)  surplus; rise 
B)  surplus; fall 
C)  shortage; fall 
D)  neither a shortage nor surplus; not change

Question 5

Explain how price can be a regulator, that is, how it can coordinate the plans of buyers and sellers.

Accepted Answer

If the price is too high, the quantity s

Question 6

Suppose a market begins in equilibrium. If supply increases, then at the original equilibrium price the quantity demanded is

Accepted Answer

A)  is less than the quantity supplied and a surplus results. 
B)  is less than the quantity supplied and a shortage results. 
C)  exceeds the quantity supplied and a surplus results. 
D)  exceeds the quantity supplied and a shortage results. 
A)  is less than the quantity supplied and a surplus results. 
B)  is less than the quantity supplied and a shortage results. 
C)  exceeds the quantity supplied and a surplus results. 
D)  exceeds the quantity supplied and a shortage results.

Question 7

If the price of chocolate chip cookies rises, then

Accepted Answer

A)  the demand curve for chocolate chip cookies shifts rightward. 
B)  the demand curve for chocolate chip cookies shifts leftward. 
C)  there is a movement downward along the demand curve for chocolate chip cookies. 
D)  there is a movement upward along the demand curve for chocolate chip cookies. 
A)  the demand curve for chocolate chip cookies shifts rightward. 
B)  the demand curve for chocolate chip cookies shifts leftward. 
C)  there is a movement downward along the demand curve for chocolate chip cookies. 
D)  there is a movement upward along the demand curve for chocolate chip cookies.

Question 8

Suppose the equilibrium price for soft drinks is $1.00. If the current price in the soft drink market is $1.25 each

Accepted Answer

A)  there will be a surplus of soft drinks. 
B)  there will be a shortage of soft drinks. 
C)  the supply curve of soft drinks will shift leftward. 
D)  the demand curve for soft drinks will shift leftward. 
A)  there will be a surplus of soft drinks. 
B)  there will be a shortage of soft drinks. 
C)  the supply curve of soft drinks will shift leftward. 
D)  the demand curve for soft drinks will shift leftward.

Question 9

For consumers, chocolate chip cookies and doughnuts are substitutes. So, an increase in the price of chocolate chip cookies will lead to a rightward shift in the demand curve for doughnuts.

Accepted Answer

A) True 
 B)False

Question 10

-The figure above shows the demand for fruit snacks. Which movement reflects a decrease in quantity demanded but NOT a decrease in demand?

Accepted Answer

A)  from point a to point e 
B)  from point a to point b 
C)  from point a to point c 
D)  from point a to point d 
A)  from point a to point e 
B)  from point a to point b 
C)  from point a to point c 
D)  from point a to point d

Question 11

Which of the following increases the quantity supplied of good X but does NOT increase the supply of good X?

Accepted Answer

A)  a fall in the price of a factor production used to produce X 
B)  an advance in the technology for producing X 
C)  an increase in the price of good Y, a complement in the production of X 
D)  an increase in the price of X 
A)  a fall in the price of a factor production used to produce X 
B)  an advance in the technology for producing X 
C)  an increase in the price of good Y, a complement in the production of X 
D)  an increase in the price of X

Question 12

If demand increases and supply decreases, what is the effect on equilibrium price and equilibrium quantity?

Accepted Answer

A)  The price falls and the quantity might increase, decrease, or remain the same. 
B)  The price rises and the quantity might increase, decrease or remain the same. 
C)  The quantity decreases and the price might rise, fall, or remain the same. 
D)  The quantity increases and the price might rise, fall, or remain the same. 
A)  The price falls and the quantity might increase, decrease, or remain the same. 
B)  The price rises and the quantity might increase, decrease or remain the same. 
C)  The quantity decreases and the price might rise, fall, or remain the same. 
D)  The quantity increases and the price might rise, fall, or remain the same.

Question 13

-The above figure shows the market for bicycles. When there is a physical fitness craze so that everyone wants to exercise the

Accepted Answer

A)  demand curve for bicycles shifts from D1 to D2. 
B)  demand curve for bicycles shifts from D2 to D1. 
C)  demand curve and the supply curve of bicycles do not shift. 
D)  supply curve of bicycles shifts from S1 to S2. 
A)  demand curve for bicycles shifts from D1 to D2. 
B)  demand curve for bicycles shifts from D2 to D1. 
C)  demand curve and the supply curve of bicycles do not shift. 
D)  supply curve of bicycles shifts from S1 to S2.

Question 14

Twenty years ago a stove cost $300 and a refrigerator cost $1,500. Today a stove costs $600, while a refrigerator costs $1,800. Which of the following statements is TRUE?

Accepted Answer

A)  The relative price of stoves and refrigerators has not changed. 
B)  The relative price of a refrigerator has increased. 
C)  The relative price of a stove has increased. 
D)  The money price of a refrigerator has fallen. 
A)  The relative price of stoves and refrigerators has not changed. 
B)  The relative price of a refrigerator has increased. 
C)  The relative price of a stove has increased. 
D)  The money price of a refrigerator has fallen.

Question 15

Consumers can use either natural gas or heating oil to warm their houses. Suppose the price of natural gas increases. Use a demand and supply diagram to show the impact of the higher price of natural gas on the market for home heating oil.

Accepted Answer

@#IMG-DLM& Natural gas and home heating oil are su

Question 16

-The figure above shows the demand for fruit snacks. Which movement reflects an increase in the price of a substitute for fruit snacks?

Accepted Answer

A)  from point a to point e 
B)  from point a to point b 
C)  from point a to point c 
D)  from point a to point d 
A)  from point a to point e 
B)  from point a to point b 
C)  from point a to point c 
D)  from point a to point d

Question 17

Farmers can use their land to grow soy beans or corn. If the price of corn rises,

Accepted Answer

A)  the supply of soybeans decreases and the soybean supply curve shifts leftward. 
B)  the supply of soybeans increases. 
C)  the supply of corn increases and the corn supply curve shifts rightward. 
D)  the supply of corn increases. 
A)  the supply of soybeans decreases and the soybean supply curve shifts leftward. 
B)  the supply of soybeans increases. 
C)  the supply of corn increases and the corn supply curve shifts rightward. 
D)  the supply of corn increases.

Question 18

Which of the following will NOT shift the supply curve for pick-up trucks?

Accepted Answer

A)  a technological advance 
B)  an increase in the price of a resource used to produce pick-up trucks 
C)  a change in the number of firms supplying pick-up trucks 
D)  a change in the price of pick-up trucks 
A)  a technological advance 
B)  an increase in the price of a resource used to produce pick-up trucks 
C)  a change in the number of firms supplying pick-up trucks 
D)  a change in the price of pick-up trucks

Question 19

If the demand curve for bottled water shifts rightward and the supply curve of bottled water shifts rightward, the equilibrium

Accepted Answer

A)  price of bottled water definitely increases. 
B)  price of bottled water definitely decreases. 
C)  quantity of bottled water definitely increases. 
D)  quantity of bottled water definitely decreases. 
A)  price of bottled water definitely increases. 
B)  price of bottled water definitely decreases. 
C)  quantity of bottled water definitely increases. 
D)  quantity of bottled water definitely decreases.

Question 20

-The figure above shows the demand for fruit snacks. Which movement reflects how consumers would react to an increase in the price of a fruit snack that is expected to occur in the future?

Accepted Answer

A)  from point a to point e 
B)  from point a to point b 
C)  from point a to point c 
D)  from point a to point d 
A)  from point a to point e 
B)  from point a to point b 
C)  from point a to point c 
D)  from point a to point d

What is the effect on the price and quantity of a product if both the demand and supply simultaneously increase?

The "law of demand" predicts that, other things being equal

The law of demand concludes that a rise in the price of a golf ball the quantity demanded and .

If the price of a CD is equal to the equilibrium price, there will be of CDs and the price will .

Explain how price can be a regulator, that is, how it can coordinate the plans of buyers and sellers.

Suppose a market begins in equilibrium. If supply increases, then at the original equilibrium price the quantity demanded is

If the price of chocolate chip cookies rises, then

Suppose the equilibrium price for soft drinks is $1.00. If the current price in the soft drink market is $1.25 each

For consumers, chocolate chip cookies and doughnuts are substitutes. So, an increase in the price of chocolate chip cookies will lead to a rightward shift in the demand curve for doughnuts.

-The figure above shows the demand for fruit snacks. Which movement reflects a decrease in quantity demanded but NOT a decrease in demand?

Which of the following increases the quantity supplied of good X but does NOT increase the supply of good X?

If demand increases and supply decreases, what is the effect on equilibrium price and equilibrium quantity?

-The above figure shows the market for bicycles. When there is a physical fitness craze so that everyone wants to exercise the

Twenty years ago a stove cost $300 and a refrigerator cost $1,500. Today a stove costs $600, while a refrigerator costs $1,800. Which of the following statements is TRUE?

Consumers can use either natural gas or heating oil to warm their houses. Suppose the price of natural gas increases. Use a demand and supply diagram to show the impact of the higher price of natural gas on the market for home heating oil.

-The figure above shows the demand for fruit snacks. Which movement reflects an increase in the price of a substitute for fruit snacks?

Farmers can use their land to grow soy beans or corn. If the price of corn rises,

Which of the following will NOT shift the supply curve for pick-up trucks?

If the demand curve for bottled water shifts rightward and the supply curve of bottled water shifts rightward, the equilibrium

-The figure above shows the demand for fruit snacks. Which movement reflects how consumers would react to an increase in the price of a fruit snack that is expected to occur in the future?

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

What is the effect on the price and quantity of a product if both the demand and supply simultaneously increase?

The "law of demand" predicts that, other things being equal

The law of demand concludes that a rise in the price of a golf ball ________ the quantity demanded and ________.

If the price of a CD is equal to the equilibrium price, there will be ________ of CDs and the price will ________.

Explain how price can be a regulator, that is, how it can coordinate the plans of buyers and sellers.

Suppose a market begins in equilibrium. If supply increases, then at the original equilibrium price the quantity demanded is

If the price of chocolate chip cookies rises, then

Suppose the equilibrium price for soft drinks is $1.00. If the current price in the soft drink market is $1.25 each

For consumers, chocolate chip cookies and doughnuts are substitutes. So, an increase in the price of chocolate chip cookies will lead to a rightward shift in the demand curve for doughnuts.

-The figure above shows the demand for fruit snacks. Which movement reflects a decrease in quantity demanded but NOT a decrease in demand?

Which of the following increases the quantity supplied of good X but does NOT increase the supply of good X?

If demand increases and supply decreases, what is the effect on equilibrium price and equilibrium quantity?

-The above figure shows the market for bicycles. When there is a physical fitness craze so that everyone wants to exercise the

Twenty years ago a stove cost $300 and a refrigerator cost $1,500. Today a stove costs $600, while a refrigerator costs $1,800. Which of the following statements is TRUE?

Consumers can use either natural gas or heating oil to warm their houses. Suppose the price of natural gas increases. Use a demand and supply diagram to show the impact of the higher price of natural gas on the market for home heating oil.

-The figure above shows the demand for fruit snacks. Which movement reflects an increase in the price of a substitute for fruit snacks?

Farmers can use their land to grow soy beans or corn. If the price of corn rises,

Which of the following will NOT shift the supply curve for pick-up trucks?

If the demand curve for bottled water shifts rightward and the supply curve of bottled water shifts rightward, the equilibrium

-The figure above shows the demand for fruit snacks. Which movement reflects how consumers would react to an increase in the price of a fruit snack that is expected to occur in the future?

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

The law of demand concludes that a rise in the price of a golf ball the quantity demanded and .

If the price of a CD is equal to the equilibrium price, there will be of CDs and the price will .