Question 1

Assuming that coffee and tea are substitutes,a decrease in the price of coffee will result in

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 2

Suppose the price of gasoline and other petroleum products decline sharply.Which of the following will most likely occur as a result of the lower petroleum prices?

Accepted Answer

A)  an increase in demand for solar heating systems 
B)  an increase in demand for larger, more powerful automobiles 
C)  an increase in demand for home insulation products 
D)  an increase in demand for gasoline 
A)  an increase in demand for solar heating systems 
B)  an increase in demand for larger, more powerful automobiles 
C)  an increase in demand for home insulation products 
D)  an increase in demand for gasoline

Question 3

Which of the following explains why the quantity of a good demanded decreases when its price increases?

Accepted Answer

A)  Consumer preferences change when the price of a good changes. 
B)  The nominal income of consumers falls when the price of a good increases. 
C)  Substitutes become relatively cheaper when the price of a good increases. 
D)  Complements become relatively cheaper when the price of a good increases. 
A)  Consumer preferences change when the price of a good changes. 
B)  The nominal income of consumers falls when the price of a good increases. 
C)  Substitutes become relatively cheaper when the price of a good increases. 
D)  Complements become relatively cheaper when the price of a good increases.

Question 4

Antonio's makes the greatest pizza and delivers it hot to all the dorms around campus.Last week Antonio's supplier of pepperoni informed him of a 25% increase in price.Which variable determining the position of the supply curve has changed and what effect does it have on supply?

Accepted Answer

A)  future expectations; supply decreases 
B)  future expectations; supply increases 
C)  input prices; supply decreases 
D)  input prices; supply increases 
A)  future expectations; supply decreases 
B)  future expectations; supply increases 
C)  input prices; supply decreases 
D)  input prices; supply increases

Question 5

Which of the following is true?

Accepted Answer

A)  According to the law of supply, the higher the price of the good, the greater the quantity supplied. 
B)  An individual supply curve is a graphical representation that shows the negative relationship between the price and the quantity an individual is willing and able to supply. 
C)  The market supply curve is the vertical summation of the individual firm supply curves. 
D)  An increase in supply is illustrated by an upward shift in the supply curve. 
A)  According to the law of supply, the higher the price of the good, the greater the quantity supplied. 
B)  An individual supply curve is a graphical representation that shows the negative relationship between the price and the quantity an individual is willing and able to supply. 
C)  The market supply curve is the vertical summation of the individual firm supply curves. 
D)  An increase in supply is illustrated by an upward shift in the supply curve.

Question 6

Skateboards International of Long Beach,California,was able to sell 20,000 skateboards at a price of $60 in 2008.In 2009,it is able to sell only 12,000 of the same skateboards at a price of $60.Evidently,Skateboard International has experienced a(n):

Accepted Answer

A)  increase in quantity supplied. 
B)  increase in demand. 
C)  increase in supply. 
D)  decrease in demand. 
A)  increase in quantity supplied. 
B)  increase in demand. 
C)  increase in supply. 
D)  decrease in demand.

Question 7

Which of the following would not cause a change in the supply of milk?

Accepted Answer

A)  an increase in government subsidies to dairy farmers 
B)  an increase in the price of milk 
C)  the discovery of growth hormones to stimulate the milk production of cows 
D)  an increase in the cost of feed for cows 
A)  an increase in government subsidies to dairy farmers 
B)  an increase in the price of milk 
C)  the discovery of growth hormones to stimulate the milk production of cows 
D)  an increase in the cost of feed for cows

Question 8

Which of the following is the correct way to describe equilibrium in a market?

Accepted Answer

A)  At equilibrium, demand equals supply. 
B)  At equilibrium, quantity demanded equals quantity supplied. 
C)  At equilibrium, market forces no longer apply. 
D)  At equilibrium, the "fairest" price for output is achieved. 
A)  At equilibrium, demand equals supply. 
B)  At equilibrium, quantity demanded equals quantity supplied. 
C)  At equilibrium, market forces no longer apply. 
D)  At equilibrium, the "fairest" price for output is achieved.

Question 9

A supply schedule shows:

Accepted Answer

A)  projected sales as ad spending varies. 
B)  how many units producers are willing and able to sell at various prices. 
C)  possible combinations of output as input prices vary. 
D)  how many units consumers would like to buy at various prices. 
A)  projected sales as ad spending varies. 
B)  how many units producers are willing and able to sell at various prices. 
C)  possible combinations of output as input prices vary. 
D)  how many units consumers would like to buy at various prices.

Question 10

Which of the following reflects the law of supply?

Accepted Answer

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

Question 11

Either an increase in the number of buyers or an increase in tastes or preferences for a good or service will increase the market demand for that good or service.

Accepted Answer

A) True 
 B)False

Question 12

Each of the following is a determinant of demand except

Accepted Answer

A)  tastes. 
B)  production technology. 
C)  expectations. 
D)  the prices of related goods. 
A)  tastes. 
B)  production technology. 
C)  expectations. 
D)  the prices of related goods.

Question 13

Exhibit 4-4   Refer to Exhibit 4-4.A change from Point A to Point D represents a(n):

Accepted Answer

A)  increase in demand. 
B)  decrease in demand. 
C)  decrease in quantity demanded. 
D)  increase in quantity demanded. 
A)  increase in demand. 
B)  decrease in demand. 
C)  decrease in quantity demanded. 
D)  increase in quantity demanded.

Question 14

Two goods are substitutes when a decrease in the price of one good

Accepted Answer

A)  decreases the demand for the other good. 
B)  decreases the quantity demanded of the other good. 
C)  increases the demand for the other good. 
D)  increases the quantity demanded of the other good. 
A)  decreases the demand for the other good. 
B)  decreases the quantity demanded of the other good. 
C)  increases the demand for the other good. 
D)  increases the quantity demanded of the other good.

Question 15

Which of the following is true of a demand curve?

Accepted Answer

A)  It must remain stable over time. 
B)  It can shift either rightward or leftward. 
C)  It is possible to move along the curve, but the demand curve will not shift. 
D)  None of the above are true. 
A)  It must remain stable over time. 
B)  It can shift either rightward or leftward. 
C)  It is possible to move along the curve, but the demand curve will not shift. 
D)  None of the above are true.

Question 16

All of the following would shift a product's demand curve except a(n):

Accepted Answer

A)  increase in the price of the product. 
B)  decrease in consumer income. 
C)  increase in the price of a substitute. 
D)  increase in the price of a complement. 
A)  increase in the price of the product. 
B)  decrease in consumer income. 
C)  increase in the price of a substitute. 
D)  increase in the price of a complement.

Question 17

Other things constant,an increase in the price of beef will:

Accepted Answer

A)  encourage consumers to buy more beef. 
B)  discourage consumers from buying as much beef. 
C)  shift the demand curve for beef to the right. 
D)  shift the demand curve for beef to the left. 
A)  encourage consumers to buy more beef. 
B)  discourage consumers from buying as much beef. 
C)  shift the demand curve for beef to the right. 
D)  shift the demand curve for beef to the left.

Question 18

Either technological progress or cost increasing new government regulations will increase supply.

Accepted Answer

A) True 
 B)False

Question 19

Downward shifts are

Accepted Answer

A)  increases in both demand and supply. 
B)  decreases in both demand and supply. 
C)  increases in demand and decreases in supply. 
D)  increases in supply and decreases in demand. 
A)  increases in both demand and supply. 
B)  decreases in both demand and supply. 
C)  increases in demand and decreases in supply. 
D)  increases in supply and decreases in demand.

Question 20

Sellers who were originally willing to supply 800 units of a good at $4 per unit are now willing to supply 800 units at $3 per unit.That change would be described as:

Accepted Answer

A)  an increase in supply. 
B)  a decrease in supply. 
C)  an increase in quantity supplied. 
D)  a decrease in quantity supplied. 
A)  an increase in supply. 
B)  a decrease in supply. 
C)  an increase in quantity supplied. 
D)  a decrease in quantity supplied.

Exam 4: Demand, Supply, and Market Equilibrium

Assuming that coffee and tea are substitutes,a decrease in the price of coffee will result in

Suppose the price of gasoline and other petroleum products decline sharply.Which of the following will most likely occur as a result of the lower petroleum prices?

Which of the following explains why the quantity of a good demanded decreases when its price increases?

Antonio's makes the greatest pizza and delivers it hot to all the dorms around campus.Last week Antonio's supplier of pepperoni informed him of a 25% increase in price.Which variable determining the position of the supply curve has changed and what effect does it have on supply?

Which of the following is true?

Skateboards International of Long Beach,California,was able to sell 20,000 skateboards at a price of $60 in 2008.In 2009,it is able to sell only 12,000 of the same skateboards at a price of $60.Evidently,Skateboard International has experienced a(n):

Which of the following would not cause a change in the supply of milk?

Which of the following is the correct way to describe equilibrium in a market?

A supply schedule shows:

Which of the following reflects the law of supply?

Either an increase in the number of buyers or an increase in tastes or preferences for a good or service will increase the market demand for that good or service.

Each of the following is a determinant of demand except

Exhibit 4-4 Refer to Exhibit 4-4.A change from Point A to Point D represents a(n):

Two goods are substitutes when a decrease in the price of one good

Which of the following is true of a demand curve?

All of the following would shift a product's demand curve except a(n):

Other things constant,an increase in the price of beef will:

Either technological progress or cost increasing new government regulations will increase supply.

Downward shifts are

Sellers who were originally willing to supply 800 units of a good at $4 per unit are now willing to supply 800 units at $3 per unit.That change would be described as:

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

Filters