Question 1

Suppose there are 100 identical firms in the rag industry,and each firm is willing to supply 10 rags at any price.The market supply curve will be a

Accepted Answer

A)  vertical line where Q = 10. 
B)  vertical line where Q = 100. 
C)  vertical line where Q = 1000. 
D)  horizontal line where Q = 1000. 
A)  vertical line where Q = 10. 
B)  vertical line where Q = 100. 
C)  vertical line where Q = 1000. 
D)  horizontal line where Q = 1000.

Question 2

Government prohibition of advertising cigarettes on television would most likely result in

Accepted Answer

A)  a rightward shift in the demand curve for cigarettes. 
B)  a leftward shift in the demand curve for cigarettes. 
C)  a rightward shift in the demand curve for television advertising time. 
D)  no change in the market for either cigarette or television advertising. 
A)  a rightward shift in the demand curve for cigarettes. 
B)  a leftward shift in the demand curve for cigarettes. 
C)  a rightward shift in the demand curve for television advertising time. 
D)  no change in the market for either cigarette or television advertising.

Question 3

If the demand for high definition televisions increases and the supply of high definition televisions increases,then

Accepted Answer

A)  it is clear that prices will increase; the change in the quantity of televisions sold is ambiguous. 
B)  it is clear that prices will decrease; the change in the quantity of televisions sold is ambiguous. 
C)  it is clear that quantity sold will increase; the change in the price of televisions is ambiguous. 
D)  it is clear that quantity sold will decrease; the change in the price of televisions is ambiguous. 
A)  it is clear that prices will increase; the change in the quantity of televisions sold is ambiguous. 
B)  it is clear that prices will decrease; the change in the quantity of televisions sold is ambiguous. 
C)  it is clear that quantity sold will increase; the change in the price of televisions is ambiguous. 
D)  it is clear that quantity sold will decrease; the change in the price of televisions is ambiguous.

Question 4

-The above figure shows a graph of a market for pizzas in a large town.At a price of $10,the market

Accepted Answer

A)  is not in equilibrium. 
B)  has excess supply. 
C)  does not have excess demand. 
D)  All of the above. 
A)  is not in equilibrium. 
B)  has excess supply. 
C)  does not have excess demand. 
D)  All of the above.

Question 5

Suppose the market demand curve for pizza can be expressed as QD = 100 - 2P + 3Pb,where QD is the quantity of pizza demanded,P is the price of a pizza,and Pb is the price of a burrito.What is the slope of this demand function,and what information does the slope provide?

Accepted Answer

The slope is -2.The slope tells us how a

Question 6

-The above figure shows a graph of the market for pizzas in a large town.Suppose that concern over dietary habits has led the government to impose a restriction that limits suppliers to produce only 40 pizzas.As a result,for prices greater than $7,the

Accepted Answer

A)  supply curve is unchanged. 
B)  supply curve is vertical. 
C)  demand curve becomes vertical. 
D)  demand curve becomes horizontal. 
A)  supply curve is unchanged. 
B)  supply curve is vertical. 
C)  demand curve becomes vertical. 
D)  demand curve becomes horizontal.

Question 7

A market equilibrium occurs

Accepted Answer

A)  only with government regulation. 
B)  only because of the profit motive of firms. 
C)  only because of the complacency of consumers. 
D)  through the interaction of self-interested consumers and producers. 
A)  only with government regulation. 
B)  only because of the profit motive of firms. 
C)  only because of the complacency of consumers. 
D)  through the interaction of self-interested consumers and producers.

Question 8

-The above figure shows a graph of the market for pizzas in a large town.If the price falls from $10 to $7 per pizza,the quantity of pizzas demanded will

Accepted Answer

A)  increase by 20. 
B)  decrease by 30. 
C)  increase by 30. 
D)  decrease by 10. 
A)  increase by 20. 
B)  decrease by 30. 
C)  increase by 30. 
D)  decrease by 10.

Question 9

Municipalities that have adopted the policy of "rent control" typically set the rentals on certain apartments well below equilibrium.As a result,

Accepted Answer

A)  landlords have a difficult time finding tenants. 
B)  prospective tenants have a difficult time finding available apartments. 
C)  there is a surplus of apartments. 
D)  All of the above. 
A)  landlords have a difficult time finding tenants. 
B)  prospective tenants have a difficult time finding available apartments. 
C)  there is a surplus of apartments. 
D)  All of the above.

Question 10

Technological innovation in the production of computers has led to

Accepted Answer

A)  a decrease in the quantity demanded for computers. 
B)  a rightward shift of the supply curve for computers. 
C)  a decrease in the quantity supplied of computers. 
D)  None of the above. 
A)  a decrease in the quantity demanded for computers. 
B)  a rightward shift of the supply curve for computers. 
C)  a decrease in the quantity supplied of computers. 
D)  None of the above.

Question 11

What is the total market supply,Qs,for luxury sports cars in the United States if the only three suppliers inverse supply functions are P = -10 + 5Qs1,P = 20 + 5Qs2,P = 5Qs3?

Accepted Answer

A)  P = 10 + 21Qs 
B)  Qs = -2 +   
C)  Qs = 6 +   
D)  Qs = -2 +   
A)  P = 10 + 21Qs 
B)  Qs = -2 +   
C)  Qs = 6 +   
D)  Qs = -2 +

Question 12

Consider the demand functions:: A)Qd = 250 - 2P B)Qd = 300 - 3P. Which of the demand functions reflects a higher level of consumer incomes?

Accepted Answer

A) A 
B) B 
C) A and B reflect the same consumer incomes. 
D) More information is needed. 
A) A 
B) B 
C) A and B reflect the same consumer incomes. 
D) More information is needed.

Question 13

If a yet-to-be released video game receives a positive review in a popular gaming magazine,

Accepted Answer

A)  the demand curve is expected to shift to the right. 
B)  the demand curve is expected to shift to the left. 
C)  the demand curve is not expected to change. 
D)  for those who read the review, demand shifts to the left. For those who don't read the review, demand shifts to the right. 
A)  the demand curve is expected to shift to the right. 
B)  the demand curve is expected to shift to the left. 
C)  the demand curve is not expected to change. 
D)  for those who read the review, demand shifts to the left. For those who don't read the review, demand shifts to the right.

Question 14

The supply and demand model assumes

Accepted Answer

A)  no buyer or seller can unilaterally influence the price of the product. 
B)  each unit sold is sold at the same price. 
C)  suppliers and demanders know the price of the product. 
D)  All of the above. 
A)  no buyer or seller can unilaterally influence the price of the product. 
B)  each unit sold is sold at the same price. 
C)  suppliers and demanders know the price of the product. 
D)  All of the above.

Question 15

If the price is $5 and the quantity demanded is 100 units,then at a price of $10,the quantity demanded will be

Accepted Answer

A)  less than or equal to 100 units. 
B)  greater than or equal to 100 units. 
C)  less than or equal to 1000 units. 
D)  equal to 100 units. 
A)  less than or equal to 100 units. 
B)  greater than or equal to 100 units. 
C)  less than or equal to 1000 units. 
D)  equal to 100 units.

Question 16

Suppose the market for potatoes can be expressed as follows:
Supply: QS = -20 + 10p
Demand: QD = 400 - 20p
Solve for the equilibrium price and quantity.

Accepted Answer

Equate the RHS of the supply e

Question 17

According to the Law of Demand,the demand curve for a good will

Accepted Answer

A)  shift leftward when the price of the good increases. 
B)  shift rightward when the price of the good increases. 
C)  slope downward. 
D)  slope upward. 
A)  shift leftward when the price of the good increases. 
B)  shift rightward when the price of the good increases. 
C)  slope downward. 
D)  slope upward.

Question 18

-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 coffee 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 19

Consumer 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 20

If pizza and tacos are substitutes,a decrease in the price of tacos would lead to a

Accepted Answer

A)  decrease in the demand curve for pizza. 
B)  decrease in the quantity demanded of pizza. 
C)  decrease in the price of pizza. 
D)  All of the above. 
A)  decrease in the demand curve for pizza. 
B)  decrease in the quantity demanded of pizza. 
C)  decrease in the price of pizza. 
D)  All of the above.

Suppose there are 100 identical firms in the rag industry,and each firm is willing to supply 10 rags at any price.The market supply curve will be a

Government prohibition of advertising cigarettes on television would most likely result in

If the demand for high definition televisions increases and the supply of high definition televisions increases,then

-The above figure shows a graph of a market for pizzas in a large town.At a price of $10,the market

Suppose the market demand curve for pizza can be expressed as Q^D = 100 - 2P + 3Pb,where Q^D is the quantity of pizza demanded,P is the price of a pizza,and Pb is the price of a burrito.What is the slope of this demand function,and what information does the slope provide?

-The above figure shows a graph of the market for pizzas in a large town.Suppose that concern over dietary habits has led the government to impose a restriction that limits suppliers to produce only 40 pizzas.As a result,for prices greater than $7,the

A market equilibrium occurs

-The above figure shows a graph of the market for pizzas in a large town.If the price falls from $10 to $7 per pizza,the quantity of pizzas demanded will

Municipalities that have adopted the policy of "rent control" typically set the rentals on certain apartments well below equilibrium.As a result,

Technological innovation in the production of computers has led to

What is the total market supply,Qs,for luxury sports cars in the United States if the only three suppliers inverse supply functions are P = -10 + 5Qs₁,P = 20 + 5Qs₂,P = 5Qs₃?

Consider the demand functions:: A)Qd = 250 - 2P B)Qd = 300 - 3P. Which of the demand functions reflects a higher level of consumer incomes?

If a yet-to-be released video game receives a positive review in a popular gaming magazine,

The supply and demand model assumes

If the price is $5 and the quantity demanded is 100 units,then at a price of $10,the quantity demanded will be

Suppose the market for potatoes can be expressed as follows: Supply: Q^S = -20 + 10p Demand: Q^D = 400 - 20p Solve for the equilibrium price and quantity.

According to the Law of Demand,the demand curve for a good will

-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 coffee after severe weather destroys a large portion of the coffee crop?

Consumer groups tend to lobby for

If pizza and tacos are substitutes,a decrease in the price of tacos would lead to a

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

Suppose there are 100 identical firms in the rag industry,and each firm is willing to supply 10 rags at any price.The market supply curve will be a

Government prohibition of advertising cigarettes on television would most likely result in

If the demand for high definition televisions increases and the supply of high definition televisions increases,then

-The above figure shows a graph of a market for pizzas in a large town.At a price of $10,the market

Suppose the market demand curve for pizza can be expressed as QD = 100 - 2P + 3Pb,where QD is the quantity of pizza demanded,P is the price of a pizza,and Pb is the price of a burrito.What is the slope of this demand function,and what information does the slope provide?

-The above figure shows a graph of the market for pizzas in a large town.Suppose that concern over dietary habits has led the government to impose a restriction that limits suppliers to produce only 40 pizzas.As a result,for prices greater than $7,the

A market equilibrium occurs

-The above figure shows a graph of the market for pizzas in a large town.If the price falls from $10 to $7 per pizza,the quantity of pizzas demanded will

Municipalities that have adopted the policy of "rent control" typically set the rentals on certain apartments well below equilibrium.As a result,

Technological innovation in the production of computers has led to

What is the total market supply,Qs,for luxury sports cars in the United States if the only three suppliers inverse supply functions are P = -10 + 5Qs1,P = 20 + 5Qs2,P = 5Qs3?

Consider the demand functions:: A)Qd = 250 - 2P B)Qd = 300 - 3P. Which of the demand functions reflects a higher level of consumer incomes?

If a yet-to-be released video game receives a positive review in a popular gaming magazine,

The supply and demand model assumes

If the price is $5 and the quantity demanded is 100 units,then at a price of $10,the quantity demanded will be

Suppose the market for potatoes can be expressed as follows: Supply: QS = -20 + 10p Demand: QD = 400 - 20p Solve for the equilibrium price and quantity.

According to the Law of Demand,the demand curve for a good will

-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 coffee after severe weather destroys a large portion of the coffee crop?

Consumer groups tend to lobby for

If pizza and tacos are substitutes,a decrease in the price of tacos would lead to a

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

Suppose the market demand curve for pizza can be expressed as Q^D = 100 - 2P + 3Pb,where Q^D is the quantity of pizza demanded,P is the price of a pizza,and Pb is the price of a burrito.What is the slope of this demand function,and what information does the slope provide?

What is the total market supply,Qs,for luxury sports cars in the United States if the only three suppliers inverse supply functions are P = -10 + 5Qs₁,P = 20 + 5Qs₂,P = 5Qs₃?

Suppose the market for potatoes can be expressed as follows: Supply: Q^S = -20 + 10p Demand: Q^D = 400 - 20p Solve for the equilibrium price and quantity.