Question 1

The price of chocolate candy bars rises.This could be due to:

Accepted Answer

A)  A decrease in the wage rate paid to workers in the candy bar factories. 
B)  A decrease in the cost of chocolate,which is used to produce candy bars. 
C)  A subsidy by the federal government for the producers of chocolate candy bars. 
D)  A decrease in the number of chocolate candy bar producers. 
A)  A decrease in the wage rate paid to workers in the candy bar factories. 
B)  A decrease in the cost of chocolate,which is used to produce candy bars. 
C)  A subsidy by the federal government for the producers of chocolate candy bars. 
D)  A decrease in the number of chocolate candy bar producers.

Question 2

Producers _______ factors of production in the _______ market.

Accepted Answer

A)  Buy;factor 
B)  Sell;stock 
C)  Buy;stock 
D)  Sell;product 
A)  Buy;factor 
B)  Sell;stock 
C)  Buy;stock 
D)  Sell;product

Question 3

A market-demand curve can be found by adding together the separate demands of the individual consumers at each price.

Accepted Answer

A) True 
 B)False

Question 4

The goals of the principal participants in the economy are to maximize:

Accepted Answer

A)  Income for consumers,profits for business,and taxes for government. 
B)  Goods and services for consumers,scarce resources for businesses,and money for government. 
C)  Happiness for consumers,profits for businesses,and general welfare for government. 
D)  Goods and services for consumers,scarce resources for businesses,and general welfare for government. 
A)  Income for consumers,profits for business,and taxes for government. 
B)  Goods and services for consumers,scarce resources for businesses,and money for government. 
C)  Happiness for consumers,profits for businesses,and general welfare for government. 
D)  Goods and services for consumers,scarce resources for businesses,and general welfare for government.

Question 5

Ceteris paribus,according to the law of supply,if the price of lawn mowing decreases from $50 per lawn to $45 per lawn,then the:

Accepted Answer

A)  Quantity supplied of lawn mowing will decrease. 
B)  Supply curve for lawn mowing will shift to the right. 
C)  Quantity supplied of lawn mowing will increase. 
D)  Quantity supplied of lawn mowing will stay the same. 
A)  Quantity supplied of lawn mowing will decrease. 
B)  Supply curve for lawn mowing will shift to the right. 
C)  Quantity supplied of lawn mowing will increase. 
D)  Quantity supplied of lawn mowing will stay the same.

Question 6

Producers:

Accepted Answer

A)  Provide dollars to the product market. 
B)  Purchase factors of production from the factor market. 
C)  Do not participate in the factor market. 
D)  Provide factors of production to the product market. 
A)  Provide dollars to the product market. 
B)  Purchase factors of production from the factor market. 
C)  Do not participate in the factor market. 
D)  Provide factors of production to the product market.

Question 7

A price floor:

Accepted Answer

A)  Decreases the quantity producers are willing and able to supply relative to the equilibrium level. 
B)  Increases the quantity demanded relative to the equilibrium level. 
C)  Causes excess demand. 
D)  Creates a market surplus. 
A)  Decreases the quantity producers are willing and able to supply relative to the equilibrium level. 
B)  Increases the quantity demanded relative to the equilibrium level. 
C)  Causes excess demand. 
D)  Creates a market surplus.

Question 8

Ceteris paribus,which of the following will cause the supply of paper to decrease?

Accepted Answer

A)  The price of lumber,an ingredient in paper production,increases. 
B)  The federal government decides to subsidize the production of paper. 
C)  People rely more on electronic books and less on printed materials. 
D)  The technology used to produce paper improves. 
A)  The price of lumber,an ingredient in paper production,increases. 
B)  The federal government decides to subsidize the production of paper. 
C)  People rely more on electronic books and less on printed materials. 
D)  The technology used to produce paper improves.

Question 9

According to the law of demand,a demand curve:

Accepted Answer

A)  Is upward sloping. 
B)  Is downward sloping. 
C)  Is a horizontal,or flat,line. 
D)  Can slope either upward or downward based on consumer behavior. 
A)  Is upward sloping. 
B)  Is downward sloping. 
C)  Is a horizontal,or flat,line. 
D)  Can slope either upward or downward based on consumer behavior.

Question 10

Market price is always the same as equilibrium price.

Accepted Answer

A) True 
 B)False

Question 11

Ceteris paribus,which of the following will cause the demand curve for basketballs to shift to the left?

Accepted Answer

A)  The cost of producing basketballs increases. 
B)  Consumer incomes increase. 
C)  Parents decide soccer is a better sport for their children than basketball. 
D)  People become more interested in basketball as more football players are arrested for drugs. 
A)  The cost of producing basketballs increases. 
B)  Consumer incomes increase. 
C)  Parents decide soccer is a better sport for their children than basketball. 
D)  People become more interested in basketball as more football players are arrested for drugs.

Question 12

If a state decides to reduce the cost of college tuition,by providing more Pell grants to students ceteris paribus,then the:

Accepted Answer

A)  Quantity demanded of a college education in the state will decrease. 
B)  Demand for a college education in the state will decrease. 
C)  Quantity demanded of a college education in the state will increase. 
D)  Quantity supplied of a college education in the state will increase. 
A)  Quantity demanded of a college education in the state will decrease. 
B)  Demand for a college education in the state will decrease. 
C)  Quantity demanded of a college education in the state will increase. 
D)  Quantity supplied of a college education in the state will increase.

Question 13

Price ceilings are below the equilibrium price and cause surpluses.

Accepted Answer

A) True 
 B)False

Question 14

Government price guarantees for certain crops are an example of:

Accepted Answer

A)  A price floor. 
B)  A price ceiling. 
C)  A monopoly. 
D)  The market mechanism. 
A)  A price floor. 
B)  A price ceiling. 
C)  A monopoly. 
D)  The market mechanism.

Question 15

If you really want a new BMW then,from an economic standpoint,you demand it.

Accepted Answer

A) True 
 B)False

Question 16

In the market for web design services,if businesses expect consumers to make more on-line purchases,then the equilibrium:

Accepted Answer

A)  Price of web design services will decrease. 
B)  Price of web design services will increase. 
C)  Quantity of web design services will remain unchanged. 
D)  Quantity of web design services will decrease. 
A)  Price of web design services will decrease. 
B)  Price of web design services will increase. 
C)  Quantity of web design services will remain unchanged. 
D)  Quantity of web design services will decrease.

Question 17

List the determinants of demand.Give one example that will show how a change in a determinant will cause a shift to the right.Give one example that will show how a change in a determinate will cause a shift to the left.

Accepted Answer

The determinants of demand are:Tastes,In

Question 18

If demand is constant,a decrease in the supply of gasoline will cause the equilibrium price:

Accepted Answer

A)  To rise and quantity to fall. 
B)  And quantity both to rise. 
C)  To fall and quantity to rise. 
D)  And quantity both to fall. 
A)  To rise and quantity to fall. 
B)  And quantity both to rise. 
C)  To fall and quantity to rise. 
D)  And quantity both to fall.

Question 19

A price ceiling does all of the following except:

Accepted Answer

A)  Increases the quantity demanded relative to the equilibrium level. 
B)  Creates excess supply. 
C)  Creates a market shortage. 
D)  Decreases the quantity supplied relative to the equilibrium level. 
A)  Increases the quantity demanded relative to the equilibrium level. 
B)  Creates excess supply. 
C)  Creates a market shortage. 
D)  Decreases the quantity supplied relative to the equilibrium level.

Question 20

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 pecans.Many pecan trees are destroyed by webworms.

Accepted Answer

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

The price of chocolate candy bars rises.This could be due to:

Producers _ factors of production in the _ market.

A market-demand curve can be found by adding together the separate demands of the individual consumers at each price.

The goals of the principal participants in the economy are to maximize:

Ceteris paribus,according to the law of supply,if the price of lawn mowing decreases from $50 per lawn to $45 per lawn,then the:

Producers:

A price floor:

Ceteris paribus,which of the following will cause the supply of paper to decrease?

According to the law of demand,a demand curve:

Market price is always the same as equilibrium price.

Ceteris paribus,which of the following will cause the demand curve for basketballs to shift to the left?

If a state decides to reduce the cost of college tuition,by providing more Pell grants to students ceteris paribus,then the:

Price ceilings are below the equilibrium price and cause surpluses.

Government price guarantees for certain crops are an example of:

If you really want a new BMW then,from an economic standpoint,you demand it.

In the market for web design services,if businesses expect consumers to make more on-line purchases,then the equilibrium:

List the determinants of demand.Give one example that will show how a change in a determinant will cause a shift to the right.Give one example that will show how a change in a determinate will cause a shift to the left.

If demand is constant,a decrease in the supply of gasoline will cause the equilibrium price:

A price ceiling does all of the following except:

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

The price of chocolate candy bars rises.This could be due to:

Producers _______ factors of production in the _______ market.

A market-demand curve can be found by adding together the separate demands of the individual consumers at each price.

The goals of the principal participants in the economy are to maximize:

Ceteris paribus,according to the law of supply,if the price of lawn mowing decreases from $50 per lawn to $45 per lawn,then the:

Producers:

A price floor:

Ceteris paribus,which of the following will cause the supply of paper to decrease?

According to the law of demand,a demand curve:

Market price is always the same as equilibrium price.

Ceteris paribus,which of the following will cause the demand curve for basketballs to shift to the left?

If a state decides to reduce the cost of college tuition,by providing more Pell grants to students ceteris paribus,then the:

Price ceilings are below the equilibrium price and cause surpluses.

Government price guarantees for certain crops are an example of:

If you really want a new BMW then,from an economic standpoint,you demand it.

In the market for web design services,if businesses expect consumers to make more on-line purchases,then the equilibrium:

List the determinants of demand.Give one example that will show how a change in a determinant will cause a shift to the right.Give one example that will show how a change in a determinate will cause a shift to the left.

If demand is constant,a decrease in the supply of gasoline will cause the equilibrium price:

A price ceiling does all of the following except:

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

Producers _ factors of production in the _ market.