Question 1

If the supply and demand curves intersect at $14, then any price below that would result in:

Accepted Answer

A) a shortage. 
B) a surplus. 
C) equilibrium. 
D) an increase in demand. 
A) a shortage. 
B) a surplus. 
C) equilibrium. 
D) an increase in demand.

Question 2

The market for good Y, a perfectly competitive good, is made up of 15 producers who each produce the same amount of good Y. If the price of good Y is $100 and the total quantity supplied is 150, how many units of good Y is each producer supplying?

Accepted Answer

A) 10 
B) 150 
C) 100 
D) 15 
A) 10 
B) 150 
C) 100 
D) 15

Question 3

An ambiguous change in price and a decrease in quantity are most likely caused by:

Accepted Answer

A) no shift in supply and a shift to the left in demand. 
B) a shift to the left in supply and a shift to the left in demand. 
C) a shift to the right in supply and a shift to the left in demand. 
D) a shift to the left in supply and a shift to the right in demand. 
A) no shift in supply and a shift to the left in demand. 
B) a shift to the left in supply and a shift to the left in demand. 
C) a shift to the right in supply and a shift to the left in demand. 
D) a shift to the left in supply and a shift to the right in demand.

Question 4

Consider the market for corn. What happens if there is an increased demand for corn tortillas and at the same time a new corn seed becomes available that dramatically increases the yield per acre?

Accepted Answer

A) Price and quantity decrease. 
B) The change in price is indeterminate; quantity decreases. 
C) The change in price is indeterminate; quantity increases. 
D) Price increases; the change in quantity is indeterminate. 
A) Price and quantity decrease. 
B) The change in price is indeterminate; quantity decreases. 
C) The change in price is indeterminate; quantity increases. 
D) Price increases; the change in quantity is indeterminate.

Question 5

It is certain that the equilibrium price will rise when the supply curve shifts to the _____ and the demand curve shifts to the _____.

Accepted Answer

A) right; right 
B) right; left 
C) left; left 
D) left; right 
A) right; right 
B) right; left 
C) left; left 
D) left; right

Question 6

Use the following to answer questions :  
-(Table: Competitive Market for Good Z) Look at the table Competitive Market for Good Z. The equilibrium price and quantity in this market are, respectively:

Accepted Answer

A) $5 and 40 units. 
B) $20 and 60 units. 
C) $10 and 30 units. 
D) $15 and 20 units. 
A) $5 and 40 units. 
B) $20 and 60 units. 
C) $10 and 30 units. 
D) $15 and 20 units.

Question 7

Use the following to answer questions :
Figure: Four Markets for DVDs  
-(Figure: Four Markets for DVDs) Look at the figure Four Markets for DVDs. If D1 or S1 is the original curve and D2 or S2 is the new curve, which of the graphs shows a change that results in a decrease in the quantity of DVDs supplied?

Accepted Answer

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

Question 8

If coffee and tea are viewed as substitutes in consumption, then an increase in the price of coffee will increase the demand for tea.

Accepted Answer

A) True 
 B)False

Question 9

Use the following to answer questions:
Figure: Demand and Supply of Gasoline  
-(Figure: Demand and Supply of Gasoline) Look at the figure Demand and Supply of Gasoline. When the supply curve shifted from the initial equilibrium, the new intersection of supply and demand has a price of _____ and quantity of 400. This supply shift could have resulted from _____.

Accepted Answer

A) $1.50; an increase in consumers' income 
B) $1.50; an improvement in refining technology 
C) $2.00; an increase in the number of buyers 
D) $2.00; an increase in consumers' income 
A) $1.50; an increase in consumers' income 
B) $1.50; an improvement in refining technology 
C) $2.00; an increase in the number of buyers 
D) $2.00; an increase in consumers' income

Question 10

An increase in the price of hamburger would probably result in _____ in the demand for hamburger buns.

Accepted Answer

A) a decrease 
B) an increase 
C) no change 
D) random fluctuations 
A) a decrease 
B) an increase 
C) no change 
D) random fluctuations

Question 11

Use the following to answer questions :  
-(Table: Competitive Market for Good Z) Look at the table Competitive Market for Good Z. If the demand curve for good Z is linear, it can be expressed as:

Accepted Answer

A) Qd = 3P. 
B) Qd = 50 - 2P. 
C) Qd = Qs. 
D) Qd = 100 - 2P. 
A) Qd = 3P. 
B) Qd = 50 - 2P. 
C) Qd = Qs. 
D) Qd = 100 - 2P.

Question 12

How would each of the following events affect the supply of compact cars?
I. The price of steel rises.
II. The production technology for car manufacturing improves.
III. The price of sport utility vehicles falls.

Accepted Answer

I. Steel is an important input in car pr

Question 13

In the market for corn tortilla chips, what would cause a price increase?

Accepted Answer

A) Doctors tell their patients that tortilla chips are unhealthy. 
B) There is a technological advance in tortilla chip production. 
C) A fungus kills much of the corn crop in Nebraska. 
D) The price of salsa triples. 
A) Doctors tell their patients that tortilla chips are unhealthy. 
B) There is a technological advance in tortilla chip production. 
C) A fungus kills much of the corn crop in Nebraska. 
D) The price of salsa triples.

Question 14

Over the past few years, the technology associated with producing flat-panel televisions has improved. This has led to a(n) _____ in the _____ flat-panel televisions.

Accepted Answer

A) increase; supply of 
B) decrease; demand for 
C) decrease; supply of 
D) decrease; quantity supplied of 
A) increase; supply of 
B) decrease; demand for 
C) decrease; supply of 
D) decrease; quantity supplied of

Question 15

Alice goes to the local supermarket to purchase one package of her favorite taco shells. She often pays $1.50 for a package, but she finds they are on sale for $1 each. According to the law of demand, one can expect Alice to:

Accepted Answer

A) purchase an alternative good. 
B) purchase more than one package of taco shells. 
C) decide not to purchase taco shells on this visit. 
D) buy only one package of taco shells. 
A) purchase an alternative good. 
B) purchase more than one package of taco shells. 
C) decide not to purchase taco shells on this visit. 
D) buy only one package of taco shells.

Question 16

Use the following to answer questions :
Figure: Supply of Coconuts  
-(Figure: Supply of Coconuts) Look at the figure Supply of Coconuts. If the price of coconuts decreased, it would be represented in the figure as a movement from:

Accepted Answer

A) A to B. 
B) B to A. 
C) C to A. 
D) E to B. 
A) A to B. 
B) B to A. 
C) C to A. 
D) E to B.

Question 17

Use the following to answer questions :
Figure: Shifts in Demand and Supply III  
-(Figure: Shifts in Demand and Supply III) Look at the figure Shifts in Demand and Supply III. The figure shows how supply and demand might shift in response to specific events. Suppose the technology for producing snowboards improves. Which panel BEST describes how this will affect the market for winter parkas, a complement in consumption of snowboards?

Accepted Answer

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

Question 18

Which of the following is TRUE of an inferior good?

Accepted Answer

A) When income increases, demand remains unchanged. 
B) When income increases, demand decreases. 
C) When income increases, demand increases. 
D) Income and demand are unrelated. 
A) When income increases, demand remains unchanged. 
B) When income increases, demand decreases. 
C) When income increases, demand increases. 
D) Income and demand are unrelated.

Question 19

An increase in the supply of a good is caused by:

Accepted Answer

A) input prices rising. 
B) a fall in the price of the good. 
C) an increase in the number of sellers. 
D) expectations of future price increases. 
A) input prices rising. 
B) a fall in the price of the good. 
C) an increase in the number of sellers. 
D) expectations of future price increases.

Question 20

The market price of airline flights increased recently. Some economists suggest that the price increased because of an increase in the number of business travelers. They believe that in the market for flights:

Accepted Answer

A) supply increased. 
B) supply decreased. 
C) demand increased. 
D) demand decreased. 
A) supply increased. 
B) supply decreased. 
C) demand increased. 
D) demand decreased.

If the supply and demand curves intersect at $14, then any price below that would result in:

The market for good Y, a perfectly competitive good, is made up of 15 producers who each produce the same amount of good Y. If the price of good Y is $100 and the total quantity supplied is 150, how many units of good Y is each producer supplying?

An ambiguous change in price and a decrease in quantity are most likely caused by:

Consider the market for corn. What happens if there is an increased demand for corn tortillas and at the same time a new corn seed becomes available that dramatically increases the yield per acre?

It is certain that the equilibrium price will rise when the supply curve shifts to the _ and the demand curve shifts to the _.

Use the following to answer questions : -(Table: Competitive Market for Good Z) Look at the table Competitive Market for Good Z. The equilibrium price and quantity in this market are, respectively:

If coffee and tea are viewed as substitutes in consumption, then an increase in the price of coffee will increase the demand for tea.

An increase in the price of hamburger would probably result in _____ in the demand for hamburger buns.

Use the following to answer questions : -(Table: Competitive Market for Good Z) Look at the table Competitive Market for Good Z. If the demand curve for good Z is linear, it can be expressed as:

How would each of the following events affect the supply of compact cars? I. The price of steel rises. II. The production technology for car manufacturing improves. III. The price of sport utility vehicles falls.

In the market for corn tortilla chips, what would cause a price increase?

Over the past few years, the technology associated with producing flat-panel televisions has improved. This has led to a(n) _ in the _ flat-panel televisions.

Alice goes to the local supermarket to purchase one package of her favorite taco shells. She often pays $1.50 for a package, but she finds they are on sale for $1 each. According to the law of demand, one can expect Alice to:

Use the following to answer questions : Figure: Supply of Coconuts -(Figure: Supply of Coconuts) Look at the figure Supply of Coconuts. If the price of coconuts decreased, it would be represented in the figure as a movement from:

Which of the following is TRUE of an inferior good?

An increase in the supply of a good is caused by:

The market price of airline flights increased recently. Some economists suggest that the price increased because of an increase in the number of business travelers. They believe that in the market for flights:

First Principles

Economic Models

International Trade 5

Macroeconomics: the Big Picture

Gdp and Cpi: Tracking the Macroeconomy

Unemployment and Inflation

Long-Run Economic Growth

Savings, Investment Spending, and the Financial System

Fiscal Policy Appendix Taxes and the Multiplier

Money, Banking, and the Federal Reserve System

Monetary Policy

Inflation, Disinflation, and Deflation

Crises and Consequences

Events and Ideas

Open-Economy Macroeconomics

Graphs in Economics

toward a Fuller Understanding of Present Value

Filters

Exam 3: Supply and Demand

If the supply and demand curves intersect at $14, then any price below that would result in:

The market for good Y, a perfectly competitive good, is made up of 15 producers who each produce the same amount of good Y. If the price of good Y is $100 and the total quantity supplied is 150, how many units of good Y is each producer supplying?

An ambiguous change in price and a decrease in quantity are most likely caused by:

Consider the market for corn. What happens if there is an increased demand for corn tortillas and at the same time a new corn seed becomes available that dramatically increases the yield per acre?

It is certain that the equilibrium price will rise when the supply curve shifts to the _____ and the demand curve shifts to the _____.

Use the following to answer questions : -(Table: Competitive Market for Good Z) Look at the table Competitive Market for Good Z. The equilibrium price and quantity in this market are, respectively:

If coffee and tea are viewed as substitutes in consumption, then an increase in the price of coffee will increase the demand for tea.

An increase in the price of hamburger would probably result in _____ in the demand for hamburger buns.

Use the following to answer questions : -(Table: Competitive Market for Good Z) Look at the table Competitive Market for Good Z. If the demand curve for good Z is linear, it can be expressed as:

How would each of the following events affect the supply of compact cars? I. The price of steel rises. II. The production technology for car manufacturing improves. III. The price of sport utility vehicles falls.

In the market for corn tortilla chips, what would cause a price increase?

Over the past few years, the technology associated with producing flat-panel televisions has improved. This has led to a(n) _____ in the _____ flat-panel televisions.

Alice goes to the local supermarket to purchase one package of her favorite taco shells. She often pays $1.50 for a package, but she finds they are on sale for $1 each. According to the law of demand, one can expect Alice to:

Use the following to answer questions : Figure: Supply of Coconuts -(Figure: Supply of Coconuts) Look at the figure Supply of Coconuts. If the price of coconuts decreased, it would be represented in the figure as a movement from:

Which of the following is TRUE of an inferior good?

An increase in the supply of a good is caused by:

The market price of airline flights increased recently. Some economists suggest that the price increased because of an increase in the number of business travelers. They believe that in the market for flights:

First Principles

Economic Models

International Trade 5

Macroeconomics: the Big Picture

Gdp and Cpi: Tracking the Macroeconomy

Unemployment and Inflation

Long-Run Economic Growth

Savings, Investment Spending, and the Financial System

Fiscal Policy Appendix Taxes and the Multiplier

Money, Banking, and the Federal Reserve System

Monetary Policy

Inflation, Disinflation, and Deflation

Crises and Consequences

Events and Ideas

Open-Economy Macroeconomics

Graphs in Economics

toward a Fuller Understanding of Present Value

Filters

It is certain that the equilibrium price will rise when the supply curve shifts to the _ and the demand curve shifts to the _.

Over the past few years, the technology associated with producing flat-panel televisions has improved. This has led to a(n) _ in the _ flat-panel televisions.