Question 1

If, at the current price, there is a surplus of a good, then

Accepted Answer

A)  sellers are producing more than buyers wish to buy. 
B)  the market must be in equilibrium. 
C)  the price is below the equilibrium price. 
D)  quantity demanded equals quantity supplied. 
A)  sellers are producing more than buyers wish to buy. 
B)  the market must be in equilibrium. 
C)  the price is below the equilibrium price. 
D)  quantity demanded equals quantity supplied.

Question 2

Table 4-16
The following table shows the supply and demand schedules in a market.
  
-Refer to Table 4-16. At a price of $8, how large of a surplus will there be in this market?

Accepted Answer

The answer of Table 4-16
The following table shows the supply...

Question 3

A market demand curve shows

Accepted Answer

A)  the relationship between price and the number of buyers in a market. 
B)  how quantity demanded changes when the number of sellers changes. 
C)  the sum of all prices that individual buyers are willing and able to pay for each possible quantity of the good. 
D)  how much of a good all buyers are willing and able to buy at each possible price. 
A)  the relationship between price and the number of buyers in a market. 
B)  how quantity demanded changes when the number of sellers changes. 
C)  the sum of all prices that individual buyers are willing and able to pay for each possible quantity of the good. 
D)  how much of a good all buyers are willing and able to buy at each possible price.

Question 4

Table 4-4
  
-Refer to Table 4-4. Suppose the market consists of Adam, Barb, and Carl. If the price falls by $2, the quantity demanded in the market increases by

Accepted Answer

A)  4 units. 
B)  6 units. 
C)  8 units. 
D)  10 units. 
A)  4 units. 
B)  6 units. 
C)  8 units. 
D)  10 units.

Question 5

Which of the following events would cause a movement downward and to the left along the supply curve for mangos?

Accepted Answer

A)  The number of sellers of mangos decreases. 
B)  There is an advance in technology that reduces the cost of producing mangos. 
C)  The price of mangos falls. 
D)  The price of fertilizer increases, and fertilizer is an input in the production of mangos. 
A)  The number of sellers of mangos decreases. 
B)  There is an advance in technology that reduces the cost of producing mangos. 
C)  The price of mangos falls. 
D)  The price of fertilizer increases, and fertilizer is an input in the production of mangos.

Question 6

Does a change in the price in a market result in a shift of the demand curve or in a movement along the demand curve?

Accepted Answer

A movement

Question 7

Table 4-9
  
-Refer to Table 4-9. Which combination would produce a decrease in equilibrium quantity and an indeterminate change in equilibrium price?

Accepted Answer

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

Question 8

If the demand for movies increases at the same time as the movie industry adopts labor-saving technology for producing movies, the equilibrium price for movies will increase, but the effect on the equilibrium quantity of movies is ambiguous.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following is not a reason perfect competition is a useful simplification, despite the diversity of market types we find in the world?

Accepted Answer

A)  Perfectly competitive markets are the easiest to analyze because everyone participating in the market takes the price as given by market conditions. 
B)  Some degree of competition is present in most markets. 
C)  There are many buyers and many sellers in all types of markets. 
D)  Many of the lessons that we learn by studying supply and demand under perfect competition apply in more complicated markets as well. 
A)  Perfectly competitive markets are the easiest to analyze because everyone participating in the market takes the price as given by market conditions. 
B)  Some degree of competition is present in most markets. 
C)  There are many buyers and many sellers in all types of markets. 
D)  Many of the lessons that we learn by studying supply and demand under perfect competition apply in more complicated markets as well.

Question 10

A movement upward and to the left along a given demand curve is called a decrease in demand.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following demonstrates the law of supply?

Accepted Answer

A)  When leather became more expensive, belt producers decreased their supply of belts. 
B)  When car production technology improved, car producers increased their supply of cars. 
C)  When sweater producers expected sweater prices to rise in the near future, they decreased their current supply of sweaters. 
D)  When ketchup prices rose, ketchup sellers increased their quantity supplied of ketchup. 
A)  When leather became more expensive, belt producers decreased their supply of belts. 
B)  When car production technology improved, car producers increased their supply of cars. 
C)  When sweater producers expected sweater prices to rise in the near future, they decreased their current supply of sweaters. 
D)  When ketchup prices rose, ketchup sellers increased their quantity supplied of ketchup.

Question 12

Holding all other things constant, a higher price for ski lift tickets would

Accepted Answer

A)  increase the number of skiers. 
B)  increase the price of skis. 
C)  decrease the number of skis sold. 
D)  decrease the demand for other winter recreational activities. 
A)  increase the number of skiers. 
B)  increase the price of skis. 
C)  decrease the number of skis sold. 
D)  decrease the demand for other winter recreational activities.

Question 13

The supply curve for a good is a line that relates

Accepted Answer

A)  profit and quantity supplied. 
B)  quantity supplied and quantity demanded. 
C)  price and quantity supplied. 
D)  price and profit. 
A)  profit and quantity supplied. 
B)  quantity supplied and quantity demanded. 
C)  price and quantity supplied. 
D)  price and profit.

Question 14

In a competitive market, there are so few buyers and so few sellers that each has a significant impact on the market price.

Accepted Answer

A) True 
 B)False

Question 15

If sellers expect higher basket prices in the near future, the current

Accepted Answer

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

Question 16

When supply and demand both increase, equilibrium

Accepted Answer

A)  price will increase. 
B)  price will decrease. 
C)  quantity may increase, decrease, or remain unchanged. 
D)  price may increase, decrease, or remain unchanged. 
A)  price will increase. 
B)  price will decrease. 
C)  quantity may increase, decrease, or remain unchanged. 
D)  price may increase, decrease, or remain unchanged.

Question 17

Supply and demand together determine the price and quantity of a good sold in a market.

Accepted Answer

A) True 
 B)False

Question 18

A rightward shift of a demand curve is called 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 19

If macaroni and cheese is an inferior good, then an increase in

Accepted Answer

A)  the price will cause the demand curve for macaroni and cheese to shift to the left. 
B)  the price will cause the demand curve for macaroni and cheese to shift to the right. 
C)  a consumer's income will cause the demand curve for macaroni and cheese to shift to the left. 
D)  a consumer's income will cause the demand curve for macaroni and cheese to shift to the right. 
A)  the price will cause the demand curve for macaroni and cheese to shift to the left. 
B)  the price will cause the demand curve for macaroni and cheese to shift to the right. 
C)  a consumer's income will cause the demand curve for macaroni and cheese to shift to the left. 
D)  a consumer's income will cause the demand curve for macaroni and cheese to shift to the right.

Question 20

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

Accepted Answer

A) True 
 B)False

Exam 4: The Market Forces of Supply and Demand

If, at the current price, there is a surplus of a good, then

Table 4-16 The following table shows the supply and demand schedules in a market. -Refer to Table 4-16. At a price of $8, how large of a surplus will there be in this market?

A market demand curve shows

Table 4-4 -Refer to Table 4-4. Suppose the market consists of Adam, Barb, and Carl. If the price falls by $2, the quantity demanded in the market increases by

Which of the following events would cause a movement downward and to the left along the supply curve for mangos?

Does a change in the price in a market result in a shift of the demand curve or in a movement along the demand curve?

Table 4-9 -Refer to Table 4-9. Which combination would produce a decrease in equilibrium quantity and an indeterminate change in equilibrium price?

If the demand for movies increases at the same time as the movie industry adopts labor-saving technology for producing movies, the equilibrium price for movies will increase, but the effect on the equilibrium quantity of movies is ambiguous.

Which of the following is not a reason perfect competition is a useful simplification, despite the diversity of market types we find in the world?

A movement upward and to the left along a given demand curve is called a decrease in demand.

Which of the following demonstrates the law of supply?

Holding all other things constant, a higher price for ski lift tickets would

The supply curve for a good is a line that relates

In a competitive market, there are so few buyers and so few sellers that each has a significant impact on the market price.

If sellers expect higher basket prices in the near future, the current

When supply and demand both increase, equilibrium

Supply and demand together determine the price and quantity of a good sold in a market.

A rightward shift of a demand curve is called a(n)

If macaroni and cheese is an inferior good, then an increase in

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

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

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