Question 1

Which of the following will cause a leftward shift of the supply curve for electricity?

Accepted Answer

A)  A decrease in the costs associated with the production of electricity. 
B)  A decrease in consumer incomes. 
C)  An increase in the taxes on electricity production. 
D)  An increase in the price of electricity. 
A)  A decrease in the costs associated with the production of electricity. 
B)  A decrease in consumer incomes. 
C)  An increase in the taxes on electricity production. 
D)  An increase in the price of electricity.

Question 2

Given income and resource constraints,the market mechanism typically arrives at the _______ outcome.

Accepted Answer

A)  Perfect 
B)  Government determined 
C)  Optimal 
D)  Disequilibrium 
A)  Perfect 
B)  Government determined 
C)  Optimal 
D)  Disequilibrium

Question 3

The equilibrium price and quantity are determined by the:

Accepted Answer

A)  Market mechanism. 
B)  Magical hand. 
C)  Invisible mind. 
D)  Government. 
A)  Market mechanism. 
B)  Magical hand. 
C)  Invisible mind. 
D)  Government.

Question 4

According to the law of demand:

Accepted Answer

A)  Price and quantity demanded are inversely related. 
B)  Price is constant along a particular demand curve. 
C)  The demand curve will shift rightward as price increases. 
D)  Businesses will produce more as price increases. 
A)  Price and quantity demanded are inversely related. 
B)  Price is constant along a particular demand curve. 
C)  The demand curve will shift rightward as price increases. 
D)  Businesses will produce more as price increases.

Question 5

Table 3.1 - Individual demand and supply schedules
Suppose there are three buyers and three sellers in a market as shown in the following individual demand and supply schedules.    
-In Table 3.1,if the price is set at $6,the market:

Accepted Answer

A)  Is in equilibrium. 
B)  Experiences a shortage of 21 units. 
C)  Experiences a surplus of 28 units. 
D)  Experiences a surplus of 29 units. 
A)  Is in equilibrium. 
B)  Experiences a shortage of 21 units. 
C)  Experiences a surplus of 28 units. 
D)  Experiences a surplus of 29 units.

Question 6

The goal of consumers,businesses,and governments is to maximize the welfare of society.

Accepted Answer

A) True 
 B)False

Question 7

The market supply of a particular good:

Accepted Answer

A)  Is the sum of the quantities of the good that all producers are willing and able to sell. 
B)  Indicates that sellers will produce more of the good at lower prices,ceteris paribus. 
C)  Indicates that consumers will purchase more of the good at higher prices,ceteris paribus. 
D)  Measures the quantity of goods that producers actually sell. 
A)  Is the sum of the quantities of the good that all producers are willing and able to sell. 
B)  Indicates that sellers will produce more of the good at lower prices,ceteris paribus. 
C)  Indicates that consumers will purchase more of the good at higher prices,ceteris paribus. 
D)  Measures the quantity of goods that producers actually sell.

Question 8

The demand curve will shift to the right if the number of buyers increases,ceteris paribus.

Accepted Answer

A) True 
 B)False

Question 9

The supply curve of an individual producer is based on the expected demand in the market.

Accepted Answer

A) True 
 B)False

Question 10

Figure 3.2:  
-The equilibrium price and quantity in Figure 3.2 are,respectively:

Accepted Answer

A)  $30 and 5 units. 
B)  $10 and 10 units. 
C)  $30 and 15 units. 
D)  $40 and 10 units. 
A)  $30 and 5 units. 
B)  $10 and 10 units. 
C)  $30 and 15 units. 
D)  $40 and 10 units.

Question 11

In the U.S.economy,foreigners participate in:

Accepted Answer

A)  The factor market only. 
B)  The product market only. 
C)  Both the product and factor markets. 
D)  Foreigners do not participate in the U. 
A)  The factor market only. 
B)  The product market only. 
C)  Both the product and factor markets. 
D)  Foreigners do not participate in the U.

Question 12

The demand curve for most goods will shift to the left if consumer income increases.

Accepted Answer

A) True 
 B)False

Question 13

The direct exchange of one good for another is known as:

Accepted Answer

A)  Welfare. 
B)  Barter. 
C)  Imports. 
D)  DemanD. 
A)  Welfare. 
B)  Barter. 
C)  Imports. 
D)  DemanD.

Question 14

Ceteris paribus,the demand curve for a good will shift to the right in response to:

Accepted Answer

A)  A decrease in income. 
B)  An increase in the costs of production. 
C)  An increase in tastes or preferences for the good. 
D)  A higher price for the good. 
A)  A decrease in income. 
B)  An increase in the costs of production. 
C)  An increase in tastes or preferences for the good. 
D)  A higher price for the good.

Question 15

When a concert sells out very quickly,the market for tickets is definitely in equilibrium because the number of tickets sold equals the number of tickets demanded.

Accepted Answer

A) True 
 B)False

Question 16

For consumers,most market activity can be explained by the goal of:

Accepted Answer

A)  Charitable responsibility. 
B)  Maximizing income. 
C)  Profit maximization. 
D)  Maximizing happiness. 
A)  Charitable responsibility. 
B)  Maximizing income. 
C)  Profit maximization. 
D)  Maximizing happiness.

Question 17

A price floor is:

Accepted Answer

A)  A lower limit on the price of a good. 
B)  Below the equilibrium price. 
C)  An upper limit on the price of a good. 
D)  A limit on the price of goods sold to foreigners. 
A)  A lower limit on the price of a good. 
B)  Below the equilibrium price. 
C)  An upper limit on the price of a good. 
D)  A limit on the price of goods sold to foreigners.

Question 18

Figure 3.1
Answer the indicated question(s)by selecting the letter of the following diagrams showing supply and demand shifts that best represent the effect of each event on the relevant market,ceteris paribus.  
-Refer to Figure 3.1.Consider the market for new cars.People begin saving for retirement at a much higher rate.

Accepted Answer

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

Question 19

Which of the following is a goal of businesses?

Accepted Answer

A)  To maximize happiness. 
B)  To maximize profits given resource constraints. 
C)  To produce the greatest quantity of goods. 
D)  To maximize general welfare. 
A)  To maximize happiness. 
B)  To maximize profits given resource constraints. 
C)  To produce the greatest quantity of goods. 
D)  To maximize general welfare.

Question 20

Which of the following is not a determinant of demand?

Accepted Answer

A)  Income. 
B)  Available technology. 
C)  Price of other goods. 
D)  Expectations of income. 
A)  Income. 
B)  Available technology. 
C)  Price of other goods. 
D)  Expectations of income.

Which of the following will cause a leftward shift of the supply curve for electricity?

Given income and resource constraints,the market mechanism typically arrives at the _______ outcome.

The equilibrium price and quantity are determined by the:

According to the law of demand:

Table 3.1 - Individual demand and supply schedules Suppose there are three buyers and three sellers in a market as shown in the following individual demand and supply schedules. -In Table 3.1,if the price is set at $6,the market:

The goal of consumers,businesses,and governments is to maximize the welfare of society.

The market supply of a particular good:

The demand curve will shift to the right if the number of buyers increases,ceteris paribus.

The supply curve of an individual producer is based on the expected demand in the market.

Figure 3.2: -The equilibrium price and quantity in Figure 3.2 are,respectively:

In the U.S.economy,foreigners participate in:

The demand curve for most goods will shift to the left if consumer income increases.

The direct exchange of one good for another is known as:

Ceteris paribus,the demand curve for a good will shift to the right in response to:

When a concert sells out very quickly,the market for tickets is definitely in equilibrium because the number of tickets sold equals the number of tickets demanded.

For consumers,most market activity can be explained by the goal of:

A price floor is:

Which of the following is a goal of businesses?

Which of the following is not a determinant of demand?

The Challenge of Economics

The US Economy

Consumer Demand

Supply Decisions

Competition

Monopoly

The Labor Market

Government Intervention

The Business Cycle

Aggregate Supply and Demand

Fiscal Policy

Money and Banks

Monetary Policy

Economic Growth

Theory and Reality

International Trade

Filters

Exam 3: Supply and Demand

Which of the following will cause a leftward shift of the supply curve for electricity?

Given income and resource constraints,the market mechanism typically arrives at the _______ outcome.

The equilibrium price and quantity are determined by the:

According to the law of demand:

Table 3.1 - Individual demand and supply schedules Suppose there are three buyers and three sellers in a market as shown in the following individual demand and supply schedules. -In Table 3.1,if the price is set at $6,the market:

The goal of consumers,businesses,and governments is to maximize the welfare of society.

The market supply of a particular good:

The demand curve will shift to the right if the number of buyers increases,ceteris paribus.

The supply curve of an individual producer is based on the expected demand in the market.

Figure 3.2: -The equilibrium price and quantity in Figure 3.2 are,respectively:

In the U.S.economy,foreigners participate in:

The demand curve for most goods will shift to the left if consumer income increases.

The direct exchange of one good for another is known as:

Ceteris paribus,the demand curve for a good will shift to the right in response to:

When a concert sells out very quickly,the market for tickets is definitely in equilibrium because the number of tickets sold equals the number of tickets demanded.

For consumers,most market activity can be explained by the goal of:

A price floor is:

Which of the following is a goal of businesses?

Which of the following is not a determinant of demand?

The Challenge of Economics

The US Economy

Consumer Demand

Supply Decisions

Competition

Monopoly

The Labor Market

Government Intervention

The Business Cycle

Aggregate Supply and Demand

Fiscal Policy

Money and Banks

Monetary Policy

Economic Growth

Theory and Reality

International Trade

Filters