Question 1

Suppose that demand decreases AND supply decreases. What would you expect to occur in the market for the good?

Accepted Answer

A)  equilibrium price would increase but the impact on equilibrium quantity would be ambiguous 
B)  equilibrium price would decrease but the impact on equilibrium quantity would be ambiguous 
C)  both equilibrium price and equilibrium quantity would increase 
D)  equilibrium quantity would decrease but the impact on equilibrium price would be ambiguous 
A)  equilibrium price would increase but the impact on equilibrium quantity would be ambiguous 
B)  equilibrium price would decrease but the impact on equilibrium quantity would be ambiguous 
C)  both equilibrium price and equilibrium quantity would increase 
D)  equilibrium quantity would decrease but the impact on equilibrium price would be ambiguous

Question 2

Given the following supply schedule, graph Lee's supply of croissants.

Accepted Answer

The answer of Given the following supply schedule, graph Lee's...

Question 3

The law of demand states that, other things being equal, when the price of a good rises, the quantity demanded of the good falls.

Accepted Answer

A) True 
 B)False

Question 4

Graph 4-6
  
-Refer to the Graph 4-6. At a price of $15:

Accepted Answer

A)  quantity demanded  quantity supplied 
D)  none of the above is true 
A)  quantity demanded  quantity supplied 
D)  none of the above is true

Question 5

Suppose an outbreak of Varroa kills off many beehives. Which of the following would not occur as a direct result of this event?

Accepted Answer

A)  honey sellers would not be willing to produce and sell as much honey at previous market prices 
B)  the supply of honey would decrease 
C)  honey buyers would not be willing to buy as much at previous market prices 
D)  the equilibrium price of honey would increase 
A)  honey sellers would not be willing to produce and sell as much honey at previous market prices 
B)  the supply of honey would decrease 
C)  honey buyers would not be willing to buy as much at previous market prices 
D)  the equilibrium price of honey would increase

Question 6

A demand schedule is a table showing the relationship between:

Accepted Answer

A)  the price of a good and the quantity supplied 
B)  income and the quantity of the good demanded 
C)  the price of a good and the quantity buyers are willing and able to purchase 
D)  the determinants of demand and the quantity demanded 
A)  the price of a good and the quantity supplied 
B)  income and the quantity of the good demanded 
C)  the price of a good and the quantity buyers are willing and able to purchase 
D)  the determinants of demand and the quantity demanded

Question 7

Suppose that scientists find evidence that proves that chocolate pudding increases hair growth in men who are balding. We would expect to see:

Accepted Answer

A)  no change in the demand for chocolate pudding 
B)  a decrease in the demand for chocolate pudding 
C)  an increase in the demand for chocolate pudding 
D)  a decrease in the supply of chocolate pudding 
A)  no change in the demand for chocolate pudding 
B)  a decrease in the demand for chocolate pudding 
C)  an increase in the demand for chocolate pudding 
D)  a decrease in the supply of chocolate pudding

Question 8

The Latin phrase ceteris paribus means 'other things changing'.

Accepted Answer

A) True 
 B)False

Question 9

A market is a:

Accepted Answer

A)  place where only buyers come together 
B)  place where only sellers meet 
C)  group of demanders and suppliers of a particular good or service 
D)  group of people with common desires 
A)  place where only buyers come together 
B)  place where only sellers meet 
C)  group of demanders and suppliers of a particular good or service 
D)  group of people with common desires

Question 10

Which of the following would NOT shift the demand curve for a good or service?

Accepted Answer

A)  a change in income 
B)  a change in the price of a related good 
C)  a change in expectations about the price of the good or service 
D)  a change in the price of the good or service 
A)  a change in income 
B)  a change in the price of a related good 
C)  a change in expectations about the price of the good or service 
D)  a change in the price of the good or service

Question 11

If nothing else changes, a rise in the price of a good leads to an increase in the quantity supplied of a good. This is known as:

Accepted Answer

A)  diminishing returns 
B)  conservation 
C)  the law of supply 
D)  the law of demand 
A)  diminishing returns 
B)  conservation 
C)  the law of supply 
D)  the law of demand

Question 12

A supply curve slopes upward because, ceteris paribus, a higher price means a greater quantity supplied.

Accepted Answer

A) True 
 B)False

Question 13

A movement along a supply curve is called a change in supply, while a shift of the curve is called a change in quantity supplied.

Accepted Answer

A) True 
 B)False

Question 14

Because consumers can now buy books online and get them shipped, this leads to less competition.

Accepted Answer

A) True 
 B)False

Question 15

If a forestry company expects timber prices to be higher next year rather than this year, they will supply more to the market this year.

Accepted Answer

A) True 
 B)False

Question 16

For each of the following changes, determine whether there will be a movement along the demand curve (a change in quantity demanded) or a shift in the demand curve (a change in demand).
a. a change in the price of a related good
b. a change in tastes
c. a change in the number of buyers
d. a change in price
e. a change in expectations
f. a change in income

Accepted Answer

A change in price causes a cha

Question 17

Comparative statics involves:

Accepted Answer

A)  comparing the old equilibrium and the new equilibrium 
B)  the estimating of buyer reluctance to pay the market price 
C)  comparisons of varying prices 
D)  the estimating of the friction that develops between buyer and seller 
A)  comparing the old equilibrium and the new equilibrium 
B)  the estimating of buyer reluctance to pay the market price 
C)  comparisons of varying prices 
D)  the estimating of the friction that develops between buyer and seller

Question 18

If a good or service has only more than one seller, it is called a monopoly.

Accepted Answer

A) True 
 B)False

Question 19

Table 4-2
  
-Refer to Table 4-2. In the table shown, the equilibrium price and quantity would be:

Accepted Answer

A)  $40, 6 
B)  $30, 9 
C)  $20, 12 
D)  $10, 15 
A)  $40, 6 
B)  $30, 9 
C)  $20, 12 
D)  $10, 15

Question 20

Table 4-1
A market is represented by the table below:
Quantities demanded:
  
-Refer to Table 4-1. If the price increases from $1 to $3:

Accepted Answer

A)  the market demand increases by 14 units 
B)  the quantity demanded in the market decreases by 13 units 
C)  the quantity demanded in the market decreases by 20 units 
D)  the quantity demanded in the market decreases by 5 units 
A)  the market demand increases by 14 units 
B)  the quantity demanded in the market decreases by 13 units 
C)  the quantity demanded in the market decreases by 20 units 
D)  the quantity demanded in the market decreases by 5 units

Exam 4: The Market Forces of Supply and Demand

Suppose that demand decreases AND supply decreases. What would you expect to occur in the market for the good?

Given the following supply schedule, graph Lee's supply of croissants.

The law of demand states that, other things being equal, when the price of a good rises, the quantity demanded of the good falls.

Graph 4-6 -Refer to the Graph 4-6. At a price of $15:

Suppose an outbreak of Varroa kills off many beehives. Which of the following would not occur as a direct result of this event?

A demand schedule is a table showing the relationship between:

Suppose that scientists find evidence that proves that chocolate pudding increases hair growth in men who are balding. We would expect to see:

The Latin phrase ceteris paribus means 'other things changing'.

A market is a:

Which of the following would NOT shift the demand curve for a good or service?

If nothing else changes, a rise in the price of a good leads to an increase in the quantity supplied of a good. This is known as:

A supply curve slopes upward because, ceteris paribus, a higher price means a greater quantity supplied.

A movement along a supply curve is called a change in supply, while a shift of the curve is called a change in quantity supplied.

Because consumers can now buy books online and get them shipped, this leads to less competition.

If a forestry company expects timber prices to be higher next year rather than this year, they will supply more to the market this year.

Comparative statics involves:

If a good or service has only more than one seller, it is called a monopoly.

Table 4-2 -Refer to Table 4-2. In the table shown, the equilibrium price and quantity would be:

Table 4-1 A market is represented by the table below: Quantities demanded: -Refer to Table 4-1. If the price increases from $1 to $3:

Ten Lessons From 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

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Business Strategy

Competition Policy

Monopolistic Competition

The Markets for the Factors of Production

Earnings, Unions and Discrimination

Income Inequity and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment and the Financial System

The Natural Rate of Unemployment

The Monetary System

Inflation: Its Causes and Costs

Open-Economy Macroeconomics: Basic Concepts

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

Five Debates Over Macroeconomic Policy

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