Question 1

Which of the following is not a valid relationship?

Accepted Answer

A)  For a normal good: Income   Demand   
B)  For a normal good: Income   Demand   
C)  For an inferior good: Income   Demand   
D)  For an inferior good: Income   Demand   
A)  For a normal good: Income   Demand   
B)  For a normal good: Income   Demand   
C)  For an inferior good: Income   Demand   
D)  For an inferior good: Income   Demand

Question 2

Which of the following relationships reflect the law of demand?

Accepted Answer

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

Question 3

According to the law of demand,other things equal,when the price of a good or service falls,demand increases.

Accepted Answer

A) True 
 B)False

Question 4

If the price of ice cream increases and the quantity demanded decreases,economists would describe this as:

Accepted Answer

A)  a change in demand. 
B)  a change in quantity demanded. 
C)  a change in consumer income. 
D)  a change in one of the variables that shift demand. 
A)  a change in demand. 
B)  a change in quantity demanded. 
C)  a change in consumer income. 
D)  a change in one of the variables that shift demand.

Question 5

Which of the following would not cause an increase in demand for tennis balls?

Accepted Answer

A)  a reduction in the price of tennis racquets 
B)  a decrease in the price of tennis balls 
C)  an unusually sunny fall and winter 
D)  an increase in the popularity of tennis 
A)  a reduction in the price of tennis racquets 
B)  a decrease in the price of tennis balls 
C)  an unusually sunny fall and winter 
D)  an increase in the popularity of tennis

Question 6

A technological improvement that lowers production costs for Good A will shift:

Accepted Answer

A)  the supply curve for A to the left. 
B)  the demand curve for A to the left. 
C)  the demand curve for A to the right. 
D)  the supply curve for A to the right. 
A)  the supply curve for A to the left. 
B)  the demand curve for A to the left. 
C)  the demand curve for A to the right. 
D)  the supply curve for A to the right.

Question 7

Exhibit 4-2   Refer to Exhibit 4-2.Using the graph and beginning on D1,a shift to D2 would indicate a(n):

Accepted Answer

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

Question 8

Beach resorts raise their prices during the summer months and yet more people book rooms at those times.Is this a violation of the law of demand?

Accepted Answer

No.During summer months,the demand for b

Question 9

Sellers who were originally willing to supply 800 units of a good at $4 per unit are now willing to supply 600 units at $4 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.

Question 10

Exhibit 4-3   Refer to Exhibit 4-3.Everyone has been raving about the newest summer blockbuster film.Since your Aunt Finola just sent you a nice letter with $20 enclosed,you decide to see the movie even though ticket prices have risen to $10 per ticket.You are not alone,as many students are waiting in line at the theater,shifting the demand curve to D1.The theater owners are now selling:

Accepted Answer

A)  Q1 tickets. 
B)  Q2 tickets. 
C)  Q3 tickets. 
D)  Q4 tickets. 
A)  Q1 tickets. 
B)  Q2 tickets. 
C)  Q3 tickets. 
D)  Q4 tickets.

Question 11

A demand curve shows the relationship between price and quantity demanded,"other things remaining constant." The other things that remain constant include all of the following except the:

Accepted Answer

A)  price of the product. 
B)  price of complementary products. 
C)  price of substitute products. 
D)  number of consumers in the demographic group purchasing the product. 
A)  price of the product. 
B)  price of complementary products. 
C)  price of substitute products. 
D)  number of consumers in the demographic group purchasing the product.

Question 12

Which of the following is true?

Accepted Answer

A)  A decrease in the price of ice cream would cause a decrease in the demand for frozen yogurt, a substitute. 
B)  Just as demanders will demand more now if the price of a good is expected to rise in the near future, sellers will supply more now if the price of a good is expected to rise in the near future. 
C)  An increase in supply leads to a movement up along the supply curve. 
D)  Both technological progress and cost-increasing regulations will increase supply. 
A)  A decrease in the price of ice cream would cause a decrease in the demand for frozen yogurt, a substitute. 
B)  Just as demanders will demand more now if the price of a good is expected to rise in the near future, sellers will supply more now if the price of a good is expected to rise in the near future. 
C)  An increase in supply leads to a movement up along the supply curve. 
D)  Both technological progress and cost-increasing regulations will increase supply.

Question 13

Which of the following is not a determinant of supply?

Accepted Answer

A)  input prices 
B)  technology 
C)  tastes 
D)  expectations 
A)  input prices 
B)  technology 
C)  tastes 
D)  expectations

Question 14

If peanut butter and jelly are complements,but peanut butter and tuna fish are substitutes,

Accepted Answer

A)  an increase in the price of peanut butter will increase the demand for jelly. 
B)  an increase in the price of peanut butter will decrease the demand for jelly. 
C)  an increase in the price of peanut butter will decrease the demand for tuna fish. 
D)  a decrease in the price of peanut butter will increase the demand for tuna fish. 
A)  an increase in the price of peanut butter will increase the demand for jelly. 
B)  an increase in the price of peanut butter will decrease the demand for jelly. 
C)  an increase in the price of peanut butter will decrease the demand for tuna fish. 
D)  a decrease in the price of peanut butter will increase the demand for tuna fish.

Question 15

If the price of music downloads decreases,which of the following is most likely to occur?

Accepted Answer

A)  Quantity demanded will decrease. 
B)  Quantity demanded will increase. 
C)  Demand will increase. 
D)  Demand will decrease. 
A)  Quantity demanded will decrease. 
B)  Quantity demanded will increase. 
C)  Demand will increase. 
D)  Demand will decrease.

Question 16

Exhibit 4-8   Refer to Exhibit 4-8.At $1.80 there is a ____ of ____ downloads.

Accepted Answer

A)  shortage; 3,000,000 
B)  shortage; 7,000,000 
C)  surplus; 7,000,000 
D)  surplus; 3,000,000 
A)  shortage; 3,000,000 
B)  shortage; 7,000,000 
C)  surplus; 7,000,000 
D)  surplus; 3,000,000

Question 17

If Ralph expects to earn more income next month, he may choose to

Accepted Answer

A)  save more now and spend less of his current income on goods and services. 
B)  save less now and spend more of his current income on goods and services. 
C)  decrease his current demand for goods and services. 
A)  save more now and spend less of his current income on goods and services. 
B)  save less now and spend more of his current income on goods and services. 
C)  decrease his current demand for goods and services.

Question 18

An increase in which of the following would shift the supply curve for gasoline to the right?

Accepted Answer

A)  demand for gasoline 
B)  price of gasoline 
C)  number of producers of gasoline 
D)  price of oil, an input into the production of gasoline 
A)  demand for gasoline 
B)  price of gasoline 
C)  number of producers of gasoline 
D)  price of oil, an input into the production of gasoline

Question 19

Whenever the price of Good A decreases,the demand for Good B increases.Good A and B appear to be:

Accepted Answer

A)  complements. 
B)  substitutes. 
C)  inferior goods. 
D)  normal goods. 
A)  complements. 
B)  substitutes. 
C)  inferior goods. 
D)  normal goods.

Question 20

Which of the following would not cause a change in the demand for cheese?

Accepted Answer

A)  an increase in the price of crackers, which are consumed with cheese 
B)  an increase in the income of cheese consumers 
C)  an increase in the population of cheese lovers 
D)  an increase in the price of cheese 
A)  an increase in the price of crackers, which are consumed with cheese 
B)  an increase in the income of cheese consumers 
C)  an increase in the population of cheese lovers 
D)  an increase in the price of cheese

Exam 4: Demand, Supply, and Market Equilibrium

Which of the following is not a valid relationship?

Which of the following relationships reflect the law of demand?

According to the law of demand,other things equal,when the price of a good or service falls,demand increases.

If the price of ice cream increases and the quantity demanded decreases,economists would describe this as:

Which of the following would not cause an increase in demand for tennis balls?

A technological improvement that lowers production costs for Good A will shift:

Exhibit 4-2 Refer to Exhibit 4-2.Using the graph and beginning on D1,a shift to D2 would indicate a(n):

Beach resorts raise their prices during the summer months and yet more people book rooms at those times.Is this a violation of the law of demand?

Sellers who were originally willing to supply 800 units of a good at $4 per unit are now willing to supply 600 units at $4 per unit.That change would be described as:

A demand curve shows the relationship between price and quantity demanded,"other things remaining constant." The other things that remain constant include all of the following except the:

Which of the following is true?

Which of the following is not a determinant of supply?

If peanut butter and jelly are complements,but peanut butter and tuna fish are substitutes,

If the price of music downloads decreases,which of the following is most likely to occur?

Exhibit 4-8 Refer to Exhibit 4-8.At $1.80 there is a ____ of ____ downloads.

If Ralph expects to earn more income next month, he may choose to

An increase in which of the following would shift the supply curve for gasoline to the right?

Whenever the price of Good A decreases,the demand for Good B increases.Good A and B appear to be:

Which of the following would not cause a change in the demand for cheese?

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

Exhibit 4-2 Refer to Exhibit 4-2.Using the graph and beginning on D₁,a shift to D₂ would indicate a(n):

Exhibit 4-8 Refer to Exhibit 4-8.At $1.80 there is a of downloads.