Question 1

According to the law of demand, when price increases the quantity demanded of a good

Accepted Answer

The answer of According to the law of demand, when...

Question 2

When the market price is below the equilibrium price, suppliers are unable to sell all they want to sell.

Accepted Answer

A) True 
 B)False

Question 3

The equilibrium price is the same as the market-clearing price.

Accepted Answer

A) True 
 B)False

Question 4

What will happen in the gasoline market now if buyers expect higher gasoline prices in the near future?

Accepted Answer

A)  The demand for gasoline will increase. 
B)  The demand for gasoline will decrease. 
C)  The demand for gasoline will be unaffected. 
D)  The supply of gasoline will increase. 
A)  The demand for gasoline will increase. 
B)  The demand for gasoline will decrease. 
C)  The demand for gasoline will be unaffected. 
D)  The supply of gasoline will increase.

Question 5

Fill in the table below, showing whether equilibrium price and equilibrium quantity go up, go down, stay the same, or change ambiguously.

Accepted Answer

The answer of Fill in the table below, showing whether...

Question 6

A likely example of complementary goods for most people would be

Accepted Answer

A)  canoes and paddles. 
B)  snow mobiles and sofas. 
C)  coffee and tea. 
D)  tennis balls and basketballs. 
A)  canoes and paddles. 
B)  snow mobiles and sofas. 
C)  coffee and tea. 
D)  tennis balls and basketballs.

Question 7

Table 4-12
A country club usually only allows members to purchase tickets for its celebrity golf tournament, but the club is considering allowing non-members to purchase tickets this year. The demand and supply schedules are as follows:
  
-Refer to Table 4-12. If only members are allowed to purchase tickets to this year's celebrity golf tournament, then what will be the equilibrium price?

Accepted Answer

A)  $10 
B)  $15 
C)  $20 
D)  $25 
A)  $10 
B)  $15 
C)  $20 
D)  $25

Question 8

A decrease in the price of creamer will increase the equilibrium price and decrease the equilibrium quantity in the market for coffee.

Accepted Answer

A) True 
 B)False

Question 9

Figure 4-22  
-Refer to Figure 4-22. At a price of $12, there is a

Accepted Answer

A)  surplus of 2 units. 
B)  surplus of 4 units. 
C)  shortage of 2 units. 
D)  shortage of 4 units. 
A)  surplus of 2 units. 
B)  surplus of 4 units. 
C)  shortage of 2 units. 
D)  shortage of 4 units.

Question 10

If a company making frozen orange juice expects the price of its product to be higher next month, it will supply more to the market this month.

Accepted Answer

A) True 
 B)False

Question 11

A monopoly is a market with one

Accepted Answer

A)  seller, and that seller is a price taker. 
B)  seller, and that seller sets the price. 
C)  buyer, and that buyer is a price taker. 
D)  buyer, and that buyer sets the price. 
A)  seller, and that seller is a price taker. 
B)  seller, and that seller sets the price. 
C)  buyer, and that buyer is a price taker. 
D)  buyer, and that buyer sets the price.

Question 12

What would happen to the equilibrium price and quantity of peanut butter if the price of peanuts went up, the price of jelly fell, fewer firms decided to produce peanut butter, and health officials announced that eating peanut butter was good for you?

Accepted Answer

A)  Price will fall, and the effect on quantity is ambiguous. 
B)  Price will rise, and the effect on quantity is ambiguous. 
C)  Quantity will fall, and the effect on price is ambiguous. 
D)  Quantity will rise, and the effect on price is ambiguous. 
A)  Price will fall, and the effect on quantity is ambiguous. 
B)  Price will rise, and the effect on quantity is ambiguous. 
C)  Quantity will fall, and the effect on price is ambiguous. 
D)  Quantity will rise, and the effect on price is ambiguous.

Question 13

A yard sale is an example of a market.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following characteristics is required for a perfectly competitive market?

Accepted Answer

A)  The goods offered for sale are exactly the same. 
B)  There are so many buyers and sellers that no single buyer or seller has any influence over the market price. 
C)  It is difficult for new sellers to enter the market. 
D)  Both a and b are correct. 
A)  The goods offered for sale are exactly the same. 
B)  There are so many buyers and sellers that no single buyer or seller has any influence over the market price. 
C)  It is difficult for new sellers to enter the market. 
D)  Both a and b are correct.

Question 15

An increase in demand shifts the demand curve to the left.

Accepted Answer

A) True 
 B)False

Question 16

Suppose that when income rises, the demand curve for doctor's visits shifts to the right. In this case, we know doctor's visits are

Accepted Answer

A)  inferior goods. 
B)  normal goods. 
C)  perfectly competitive goods. 
D)  durable goods. 
A)  inferior goods. 
B)  normal goods. 
C)  perfectly competitive goods. 
D)  durable goods.

Question 17

Table 4-10
The following table shows the number of cases of water each seller is willing to sell at the prices listed.
  
-Refer to Table 4-10. If the four suppliers listed are the only suppliers in this market and the market quantity demanded is 500 cases when the price is $5.00, which of the following statements is correct?

Accepted Answer

A)  The market is in equilibrium at a price of $5.00. 
B)  There is a surplus of 100 cases at a price of $5.00. 
C)  There is a shortage of 100 cases at a price of $5.00. 
D)  There is a shortage of 50 cases at a price of $5.00. 
A)  The market is in equilibrium at a price of $5.00. 
B)  There is a surplus of 100 cases at a price of $5.00. 
C)  There is a shortage of 100 cases at a price of $5.00. 
D)  There is a shortage of 50 cases at a price of $5.00.

Question 18

In a market, the price of any good adjusts until quantity demanded equals quantity supplied.

Accepted Answer

A) True 
 B)False

Question 19

Figure 4-27
Panel (a) Panel (b)
     Panel (c) Panel (d)
    
-Refer to Figure 4-27. Panel (c) shows which of the following?

Accepted Answer

A)  an increase in demand and an increase in quantity supplied 
B)  an increase in demand and an increase in supply 
C)  an increase in quantity demanded and an increase in quantity supplied 
D)  an increase in quantity demanded and an increase in supply 
A)  an increase in demand and an increase in quantity supplied 
B)  an increase in demand and an increase in supply 
C)  an increase in quantity demanded and an increase in quantity supplied 
D)  an increase in quantity demanded and an increase in supply

Question 20

Figure 4-7  
-Refer to Figure 4-7. The movement from Da to Db 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.

According to the law of demand, when price increases the quantity demanded of a good

When the market price is below the equilibrium price, suppliers are unable to sell all they want to sell.

The equilibrium price is the same as the market-clearing price.

What will happen in the gasoline market now if buyers expect higher gasoline prices in the near future?

Fill in the table below, showing whether equilibrium price and equilibrium quantity go up, go down, stay the same, or change ambiguously.

A likely example of complementary goods for most people would be

A decrease in the price of creamer will increase the equilibrium price and decrease the equilibrium quantity in the market for coffee.

Figure 4-22 -Refer to Figure 4-22. At a price of $12, there is a

If a company making frozen orange juice expects the price of its product to be higher next month, it will supply more to the market this month.

A monopoly is a market with one

What would happen to the equilibrium price and quantity of peanut butter if the price of peanuts went up, the price of jelly fell, fewer firms decided to produce peanut butter, and health officials announced that eating peanut butter was good for you?

A yard sale is an example of a market.

Which of the following characteristics is required for a perfectly competitive market?

An increase in demand shifts the demand curve to the left.

Suppose that when income rises, the demand curve for doctor's visits shifts to the right. In this case, we know doctor's visits are

In a market, the price of any good adjusts until quantity demanded equals quantity supplied.

Figure 4-27 Panel (a) Panel (b) Panel (c) Panel (d) -Refer to Figure 4-27. Panel (c) shows which of the following?

Figure 4-7 -Refer to Figure 4-7. The movement from Da to Db could be caused by

Ten Principles of 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

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

Filters

Exam 4: The Market Forces of Supply and Demand

According to the law of demand, when price increases the quantity demanded of a good

When the market price is below the equilibrium price, suppliers are unable to sell all they want to sell.

The equilibrium price is the same as the market-clearing price.

What will happen in the gasoline market now if buyers expect higher gasoline prices in the near future?

Fill in the table below, showing whether equilibrium price and equilibrium quantity go up, go down, stay the same, or change ambiguously.

A likely example of complementary goods for most people would be

A decrease in the price of creamer will increase the equilibrium price and decrease the equilibrium quantity in the market for coffee.

Figure 4-22 -Refer to Figure 4-22. At a price of $12, there is a

If a company making frozen orange juice expects the price of its product to be higher next month, it will supply more to the market this month.

A monopoly is a market with one

What would happen to the equilibrium price and quantity of peanut butter if the price of peanuts went up, the price of jelly fell, fewer firms decided to produce peanut butter, and health officials announced that eating peanut butter was good for you?

A yard sale is an example of a market.

Which of the following characteristics is required for a perfectly competitive market?

An increase in demand shifts the demand curve to the left.

Suppose that when income rises, the demand curve for doctor's visits shifts to the right. In this case, we know doctor's visits are

In a market, the price of any good adjusts until quantity demanded equals quantity supplied.

Figure 4-27 Panel (a) Panel (b) Panel (c) Panel (d) -Refer to Figure 4-27. Panel (c) shows which of the following?

Figure 4-7 -Refer to Figure 4-7. The movement from Da to Db could be caused by

Ten Principles of 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

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

Filters