Question 1

Use a supply-and-demand graph to predict what happens to sheet steel prices in the United States after quotas on Japanese and European sheet steel expire.

Accepted Answer

@#IMG-DLM& See the above figure.The quota-restrict

Question 2

Consumers and firms are known as price takers only if

Accepted Answer

A)  no market exists to determine the equilibrium price. 
B)  they can set the market price. 
C)  they cannot unilaterally affect the market price. 
D)  excess demand exists. 
A)  no market exists to determine the equilibrium price. 
B)  they can set the market price. 
C)  they cannot unilaterally affect the market price. 
D)  excess demand exists.

Question 3

At equilibrium,quantity sold equals the quantity bought.This implies that

Accepted Answer

A)  to sell more, producers require more in payment than consumers are willing to pay. 
B)  government regulation is necessary. 
C)  to sell less would require a lower price but would yield greater profit. 
D)  those who don't buy have been treated unfairly. 
A)  to sell more, producers require more in payment than consumers are willing to pay. 
B)  government regulation is necessary. 
C)  to sell less would require a lower price but would yield greater profit. 
D)  those who don't buy have been treated unfairly.

Question 4

Understanding the supply and demand model facilitates

Accepted Answer

A)  greed. 
B)  charity. 
C)  happiness. 
D)  prediction. 
A)  greed. 
B)  charity. 
C)  happiness. 
D)  prediction.

Question 5

Suppose the demand curve for a good shifts rightward,causing the equilibrium price to increase.This increase in the price of the good results in

Accepted Answer

A)  a rightward shift of the supply curve. 
B)  an increase in quantity supplied. 
C)  a leftward shift of the supply curve. 
D)  a downward movement along the supply curve. 
A)  a rightward shift of the supply curve. 
B)  an increase in quantity supplied. 
C)  a leftward shift of the supply curve. 
D)  a downward movement along the supply curve.

Question 6

Suppose the following information is known about a market:
1.Sellers will not sell at all below a price of $2.
2.At a price of $10,any given seller will sell 10 units.
3.There are 100 identical sellers in the market.
Assuming a linear supply curve,use this information to derive the market supply curve.

Accepted Answer

First,Q = 100q since all firms are ident

Question 7

If the supply curve of a product changes so that sellers are now willing to sell 2 additional units at any given price,the supply curve will

Accepted Answer

A)  shift leftward by 2 units. 
B)  shift rightward by 2 units. 
C)  shift vertically up by 2 units. 
D)  shift vertically down by 2 units. 
A)  shift leftward by 2 units. 
B)  shift rightward by 2 units. 
C)  shift vertically up by 2 units. 
D)  shift vertically down by 2 units.

Question 8

-The above figure shows the market for apples.If the government restricts output to no more than 300 pounds,then

Accepted Answer

A)  300 pounds of apples will be sold at $3. 
B)  200 pounds of apples will be sold at $3. 
C)  no apples will be sold. 
D)  None of the above. 
A)  300 pounds of apples will be sold at $3. 
B)  200 pounds of apples will be sold at $3. 
C)  no apples will be sold. 
D)  None of the above.

Question 9

The supply curve is influenced by

Accepted Answer

A)  the income of consumers. 
B)  the number of customers in the market. 
C)  the prices of the inputs required to produce the product. 
D)  the expectations of future profit. 
A)  the income of consumers. 
B)  the number of customers in the market. 
C)  the prices of the inputs required to produce the product. 
D)  the expectations of future profit.

Question 10

Tastes are starting to change for hybrid vehicles such that consumers are purchasing more hybrid vehicles and suppliers are choosing to produce more hybrid vehicles than they were five years ago.Due to the change in tastes,equilibrium price has fallen and equilibrium quantity has increased relative to the hybrid market from five years ago.What is the likely cause of this result?

Accepted Answer

A)  Supply increased by more than demand. 
B)  Demand increased by more than supply. 
C)  Demand and supply increased by the same amount. 
D)  Only supply increased. 
A)  Supply increased by more than demand. 
B)  Demand increased by more than supply. 
C)  Demand and supply increased by the same amount. 
D)  Only supply increased.

Question 11

It is appropriate to use the supply-and-demand model in which of the following markets?

Accepted Answer

A)  beer market 
B)  car market 
C)  wheat market 
D)  market for breakfast cereal 
A)  beer market 
B)  car market 
C)  wheat market 
D)  market for breakfast cereal

Question 12

-The above figure shows four different markets with changes in either the supply curve or the demand curve.Which graph best illustrates the market for computer manuals after technological advances in making computers occur?

Accepted Answer

A)  Graph A 
B)  Graph B 
C)  Graph C 
D)  Graph D 
A)  Graph A 
B)  Graph B 
C)  Graph C 
D)  Graph D

Question 13

Producer groups tend to lobby for

Accepted Answer

A)  price floors. 
B)  price ceilings. 
C)  quantity quotas. 
D)  taxes. 
A)  price floors. 
B)  price ceilings. 
C)  quantity quotas. 
D)  taxes.

Question 14

To determine the total demand for all consumers,sum the quantity each consumer demands

Accepted Answer

A)  at a given price. 
B)  at all prices and then sum this amount across all consumers. 
C)  Both A and B will generate the same total demand. 
D)  None of the above. 
A)  at a given price. 
B)  at all prices and then sum this amount across all consumers. 
C)  Both A and B will generate the same total demand. 
D)  None of the above.

Question 15

The market supply curve is found by

Accepted Answer

A)  horizontally summing all individual supply curves. 
B)  vertically summing all individual supply curves. 
C)  Either A or B above since they both give the same answer. 
D)  None of the above. 
A)  horizontally summing all individual supply curves. 
B)  vertically summing all individual supply curves. 
C)  Either A or B above since they both give the same answer. 
D)  None of the above.

Question 16

-The above figure shows four different markets with changes in either the supply curve or the demand curve.Which graph best illustrates the market for typewriters after technological advances in computerized word-processing software occur?

Accepted Answer

A)  Graph A 
B)  Graph B 
C)  Graph C 
D)  Graph D 
A)  Graph A 
B)  Graph B 
C)  Graph C 
D)  Graph D

Question 17

The demand function for tickets to Ireland is expressed as Qd = 1600 - 0.005P + 2 PEngland + 3rain + 2Y,where P is the price for tickets to Ireland,PEngland is the price of tickets to England,rain is the inches of rain Ireland receives annually,and Y is annual household income.Assuming PEngland is $1000,rain is 30 inches per year,and income is 40,000,how much would the price of tickets to Ireland have to fall for consumers to be willing to buy one more trip per year?

Accepted Answer

A)  $15 
B)  $20 
C)  $50 
D)  $200 
A)  $15 
B)  $20 
C)  $50 
D)  $200

Question 18

Suppose there is a linear downward-sloping demand curve and a linear upward-sloping supply curve for a good.The price of a substitute good increases and the price of an input to production also increases.Graph the original demand and supply curves,and the curves after the substitute good and input prices increase.How will the equilibrium price change after the substitute and input prices increase?

Accepted Answer

@#IMG-DLM& See the above figure.The new demand cur

Question 19

-The above figure shows four different markets with changes in either the supply curve or the demand curve.Assuming coffee and tea are substitutes,which graph best illustrates the market for tea after severe weather destroys a large portion of the coffee crop?

Accepted Answer

A)  Graph A 
B)  Graph B 
C)  Graph C 
D)  Graph D 
A)  Graph A 
B)  Graph B 
C)  Graph C 
D)  Graph D

Question 20

When two goods are substitutes,a shock that raises the price of one good causes the price of the other good to

Accepted Answer

A)  remain unchanged. 
B)  decrease. 
C)  increase. 
D)  change in an unpredictable manner. 
A)  remain unchanged. 
B)  decrease. 
C)  increase. 
D)  change in an unpredictable manner.

Use a supply-and-demand graph to predict what happens to sheet steel prices in the United States after quotas on Japanese and European sheet steel expire.

Consumers and firms are known as price takers only if

At equilibrium,quantity sold equals the quantity bought.This implies that

Understanding the supply and demand model facilitates

Suppose the demand curve for a good shifts rightward,causing the equilibrium price to increase.This increase in the price of the good results in

If the supply curve of a product changes so that sellers are now willing to sell 2 additional units at any given price,the supply curve will

-The above figure shows the market for apples.If the government restricts output to no more than 300 pounds,then

The supply curve is influenced by

It is appropriate to use the supply-and-demand model in which of the following markets?

-The above figure shows four different markets with changes in either the supply curve or the demand curve.Which graph best illustrates the market for computer manuals after technological advances in making computers occur?

Producer groups tend to lobby for

To determine the total demand for all consumers,sum the quantity each consumer demands

The market supply curve is found by

-The above figure shows four different markets with changes in either the supply curve or the demand curve.Which graph best illustrates the market for typewriters after technological advances in computerized word-processing software occur?

-The above figure shows four different markets with changes in either the supply curve or the demand curve.Assuming coffee and tea are substitutes,which graph best illustrates the market for tea after severe weather destroys a large portion of the coffee crop?

When two goods are substitutes,a shock that raises the price of one good causes the price of the other good to

Introduction

Applying the Supply and Demand Model

Consumer Choice

Applying Consumer Theory

Firms and Production

Costs

Competitive Firms and Markets

Applying the Competitive Model

General Equilibrium and Economic Welfare

Monopoly

Pricing and Advertising

Oligopoly and Monopolistic Competition

Game Theory

Factor Markets

Interest Rates, Investments, and Capital Markets

Uncertainty

Externalities, Open-Access, and Public Goods

Asymmetric Information

Contracts and Moral Hazards

Filters

Exam 2: Supply and Demand

Use a supply-and-demand graph to predict what happens to sheet steel prices in the United States after quotas on Japanese and European sheet steel expire.

Consumers and firms are known as price takers only if

At equilibrium,quantity sold equals the quantity bought.This implies that

Understanding the supply and demand model facilitates

Suppose the demand curve for a good shifts rightward,causing the equilibrium price to increase.This increase in the price of the good results in

If the supply curve of a product changes so that sellers are now willing to sell 2 additional units at any given price,the supply curve will

-The above figure shows the market for apples.If the government restricts output to no more than 300 pounds,then

The supply curve is influenced by

It is appropriate to use the supply-and-demand model in which of the following markets?

-The above figure shows four different markets with changes in either the supply curve or the demand curve.Which graph best illustrates the market for computer manuals after technological advances in making computers occur?

Producer groups tend to lobby for

To determine the total demand for all consumers,sum the quantity each consumer demands

The market supply curve is found by

-The above figure shows four different markets with changes in either the supply curve or the demand curve.Which graph best illustrates the market for typewriters after technological advances in computerized word-processing software occur?

-The above figure shows four different markets with changes in either the supply curve or the demand curve.Assuming coffee and tea are substitutes,which graph best illustrates the market for tea after severe weather destroys a large portion of the coffee crop?

When two goods are substitutes,a shock that raises the price of one good causes the price of the other good to

Introduction

Applying the Supply and Demand Model

Consumer Choice

Applying Consumer Theory

Firms and Production

Costs

Competitive Firms and Markets

Applying the Competitive Model

General Equilibrium and Economic Welfare

Monopoly

Pricing and Advertising

Oligopoly and Monopolistic Competition

Game Theory

Factor Markets

Interest Rates, Investments, and Capital Markets

Uncertainty

Externalities, Open-Access, and Public Goods

Asymmetric Information

Contracts and Moral Hazards

Filters