Question 1

An increase in demand could be caused by

Accepted Answer

A)  a decrease in price. 
B)  a decrease in income, assuming the good is inferior. 
C)  buyers expecting the price of the good to fall in the near future. 
D)  an increase in the price of a complement. 
A)  a decrease in price. 
B)  a decrease in income, assuming the good is inferior. 
C)  buyers expecting the price of the good to fall in the near future. 
D)  an increase in the price of a complement.

Question 2

All of the following factors will affect the supply of shoes except one.Which will not affect the supply of shoes?

Accepted Answer

A)  higher wages for shoe factory workers 
B)  higher prices for leather 
C)  a technological improvement that reduces waste of leather and other raw materials in shoe production 
D)  an increase in consumer income 
A)  higher wages for shoe factory workers 
B)  higher prices for leather 
C)  a technological improvement that reduces waste of leather and other raw materials in shoe production 
D)  an increase in consumer income

Question 3

If the price of pizza falls,the demand for pizza will rise.

Accepted Answer

A) True 
 B)False

Question 4

If a shortage exists in a market,then we know that the actual price is

Accepted Answer

A)  above the equilibrium price, and quantity supplied is greater than quantity demanded. 
B)  above the equilibrium price, and quantity demanded is greater than quantity supplied. 
C)  below the equilibrium price, and quantity demanded is greater than quantity supplied. 
D)  below the equilibrium price, and quantity supplied is greater than quantity demanded. 
A)  above the equilibrium price, and quantity supplied is greater than quantity demanded. 
B)  above the equilibrium price, and quantity demanded is greater than quantity supplied. 
C)  below the equilibrium price, and quantity demanded is greater than quantity supplied. 
D)  below the equilibrium price, and quantity supplied is greater than quantity demanded.

Question 5

Assuming that Chinese food and Thai food are substitutes,if P.F.Chang's Chinese Restaurant reduces its prices:

Accepted Answer

A) the sales of the nearby Bahn Thai restaurant will increase. 
B) demand for meals at P.F.Chang's will increase. 
C) the demand for meals at the Bahn Thai restaurant will decrease. 
D) the quantity of food demanded from P.F.Chang's will decrease. 
A) the sales of the nearby Bahn Thai restaurant will increase. 
B) demand for meals at P.F.Chang's will increase. 
C) the demand for meals at the Bahn Thai restaurant will decrease. 
D) the quantity of food demanded from P.F.Chang's will decrease.

Question 6

Which of the following would shift the demand curve for gasoline to the right?

Accepted Answer

A)  a decrease in the price of gasoline 
B)  an increase in consumer income, assuming gasoline is a normal good 
C)  an increase in the price of cars, a complement for gasoline 
D)  a decrease in the expected future price of gasoline 
A)  a decrease in the price of gasoline 
B)  an increase in consumer income, assuming gasoline is a normal good 
C)  an increase in the price of cars, a complement for gasoline 
D)  a decrease in the expected future price of gasoline

Question 7

The quantity demanded of a good is the amount that buyers are

Accepted Answer

A)  willing to buy. 
B)  willing and able to buy. 
C)  willing, able, and need to buy. 
D)  able to buy. 
A)  willing to buy. 
B)  willing and able to buy. 
C)  willing, able, and need to buy. 
D)  able to buy.

Question 8

Exhibit 4-9 The diagram below represents the market for butter.   Refer to Exhibit 4-9.If the current price of butter equals $5,you would expect to find:

Accepted Answer

A)  the market in equilibrium at 2,000 pounds per year. 
B)  the market in equilibrium at 8,000 pounds per year. 
C)  that the market is not in equilibrium, and that the quantity supplied is greater than the quantity demanded. 
D)  that the market is not in equilibrium, and that the quantity demanded is greater than the quantity supplied. 
A)  the market in equilibrium at 2,000 pounds per year. 
B)  the market in equilibrium at 8,000 pounds per year. 
C)  that the market is not in equilibrium, and that the quantity supplied is greater than the quantity demanded. 
D)  that the market is not in equilibrium, and that the quantity demanded is greater than the quantity supplied.

Question 9

An increase in the price of Product X leads to a decrease in demand for Product Y.The price increase also increases the demand for Product Z,a related good.Discuss the relationship between these products.

Accepted Answer

Product X and Produc

Question 10

An increase in quantity demanded

Accepted Answer

A)  illustrated by a movement downward and to the right along a demand curve. 
B)  illustrated by a movement upward and to the left along a demand curve. 
C)  shifts the demand curve to the left. 
D)  shifts the demand curve to the right. 
A)  illustrated by a movement downward and to the right along a demand curve. 
B)  illustrated by a movement upward and to the left along a demand curve. 
C)  shifts the demand curve to the left. 
D)  shifts the demand curve to the right.

Question 11

Which of the following would reduce the supply of computers?

Accepted Answer

A)  higher wage rates for the workers that assemble the computers 
B)  a technological improvement that lowers the cost of producing the computers 
C)  a reduction in the price of computer chips used to produce the computers 
D)  All of the above would reduce the supply of computers. 
A)  higher wage rates for the workers that assemble the computers 
B)  a technological improvement that lowers the cost of producing the computers 
C)  a reduction in the price of computer chips used to produce the computers 
D)  All of the above would reduce the supply of computers.

Question 12

At an equilibrium price:

Accepted Answer

A)  quantity demanded exceeds quantity supplied. 
B)  quantity demanded equals quantity supplied. 
C)  quantity demanded is less than quantity supplied. 
D)  there is no scarcity. 
A)  quantity demanded exceeds quantity supplied. 
B)  quantity demanded equals quantity supplied. 
C)  quantity demanded is less than quantity supplied. 
D)  there is no scarcity.

Question 13

Exhibit 4-9 The diagram below represents the market for butter.   Refer to Exhibit 4-9.The equilibrium price of butter is:

Accepted Answer

A)  $5 
B)  $3 
C)  $2 
D)  none of the above 
A)  $5 
B)  $3 
C)  $2 
D)  none of the above

Question 14

When the price of steak falls,we would expect the quantity demanded of steak to rise.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following best represents the effects of a decrease in the price of tea?

Accepted Answer

A)  A leftward shift in the demand for tea. 
B)  A downward movement along the demand curve for tea. 
C)  A rightward shift in the demand for tea. 
D)  An upward movement along the demand curve for tea. 
A)  A leftward shift in the demand for tea. 
B)  A downward movement along the demand curve for tea. 
C)  A rightward shift in the demand for tea. 
D)  An upward movement along the demand curve for tea.

Question 16

Which of the following would be least likely to affect the supply of automobiles?

Accepted Answer

A)  higher prices for steel and other resources used in producing automobiles 
B)  a successful physical fitness plan encouraging Americans to walk rather than drive to their destinations 
C)  a technological improvement reducing the production costs of automobiles 
D)  increased wages for members of the United Auto Workers union 
A)  higher prices for steel and other resources used in producing automobiles 
B)  a successful physical fitness plan encouraging Americans to walk rather than drive to their destinations 
C)  a technological improvement reducing the production costs of automobiles 
D)  increased wages for members of the United Auto Workers union

Question 17

Roxanne views movie tickets and DVD rentals to be substitute forms of entertainment.An increase in the price of a DVD rental will probably result in an increase in the:

Accepted Answer

A)  supply of movie tickets. 
B)  quantity of movie tickets demanded. 
C)  quantity of DVD rentals demanded. 
D)  demand for movie tickets. 
A)  supply of movie tickets. 
B)  quantity of movie tickets demanded. 
C)  quantity of DVD rentals demanded. 
D)  demand for movie tickets.

Question 18

Which of the following would not shift the supply curve for swordfish?

Accepted Answer

A)  a reduction in the number of available fishing boats 
B)  unusually stormy weather during fishing season 
C)  the development of innovative new fishing equipment that makes it easier to catch swordfish 
D)  an increase in the price of swordfish 
A)  a reduction in the number of available fishing boats 
B)  unusually stormy weather during fishing season 
C)  the development of innovative new fishing equipment that makes it easier to catch swordfish 
D)  an increase in the price of swordfish

Question 19

A movement along the demand curve might be caused by a change in

Accepted Answer

A)  income. 
B)  the prices of substitutes or complements. 
C)  expectations about future prices. 
D)  the price of the good or service that is being demanded. 
A)  income. 
B)  the prices of substitutes or complements. 
C)  expectations about future prices. 
D)  the price of the good or service that is being demanded.

Question 20

When quantity demanded increases at every possible price,the demand curve

Accepted Answer

A)  shifts to the left. 
B)  shifts to the right. 
C)  there is a movement along the given demand curve. 
D)  none of the above. 
A)  shifts to the left. 
B)  shifts to the right. 
C)  there is a movement along the given demand curve. 
D)  none of the above.

Exam 4: Demand, Supply, and Market Equilibrium

An increase in demand could be caused by

All of the following factors will affect the supply of shoes except one.Which will not affect the supply of shoes?

If the price of pizza falls,the demand for pizza will rise.

If a shortage exists in a market,then we know that the actual price is

Assuming that Chinese food and Thai food are substitutes,if P.F.Chang's Chinese Restaurant reduces its prices:

Which of the following would shift the demand curve for gasoline to the right?

The quantity demanded of a good is the amount that buyers are

Exhibit 4-9 The diagram below represents the market for butter. Refer to Exhibit 4-9.If the current price of butter equals $5,you would expect to find:

An increase in the price of Product X leads to a decrease in demand for Product Y.The price increase also increases the demand for Product Z,a related good.Discuss the relationship between these products.

An increase in quantity demanded

Which of the following would reduce the supply of computers?

At an equilibrium price:

Exhibit 4-9 The diagram below represents the market for butter. Refer to Exhibit 4-9.The equilibrium price of butter is:

When the price of steak falls,we would expect the quantity demanded of steak to rise.

Which of the following best represents the effects of a decrease in the price of tea?

Which of the following would be least likely to affect the supply of automobiles?

Roxanne views movie tickets and DVD rentals to be substitute forms of entertainment.An increase in the price of a DVD rental will probably result in an increase in the:

Which of the following would not shift the supply curve for swordfish?

A movement along the demand curve might be caused by a change in

When quantity demanded increases at every possible price,the demand curve

The Role and Method of Economics

Economics: Eight Powerful Ideas

Scarcity, Trade-Offs, and Production Possibilities

Markets in Motion and Price Controls

Elasticities

Market Efficiency and Welfare

Market Failure

Public Finance and Public Choice

Consumer Choice Theory

The Firm: Production and Costs

Firms in Perfectly Competitive Markets

Monopoly and Antitrust

Monopolistic Competition and Product Differentiation

Oligopoly and Strategic Behavior

The Markets for Labor, Capital, and Land

Income, Poverty, and Health Care

Introduction to Macroeconomics: Unemployment, Inflation, and Economic Fluctuations

Measuring Economic Performance

Economic Growth in the Global Economy

Financial Markets, Saving, and Investment

Aggregate Demand and Aggregate Supply

The Aggregate Expenditure Model

Monetary Institutions

The Federal Reserve System and Monetary Policy

Issues in Macroeconomic Theory and Policy

International Trade

International Finance

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