Question 1

A likely example of substitute goods for most people would be

Accepted Answer

A) tables and chairs. 
B) bicycles and helmets. 
C) apple juice and orange juice. 
D) coffee and sugar. 
A) tables and chairs. 
B) bicycles and helmets. 
C) apple juice and orange juice. 
D) coffee and sugar.

Question 2

If mayonnaise and Miracle Whip are substitutes,then which of the following would increase the demand for Miracle Whip?

Accepted Answer

A) a decrease in the price of Miracle Whip 
B) an increase in the price of mayonnaise 
C) a decrease in the price of mayonnaise 
D) Both a and b are correct. 
A) a decrease in the price of Miracle Whip 
B) an increase in the price of mayonnaise 
C) a decrease in the price of mayonnaise 
D) Both a and b are correct.

Question 3

Pizza is a normal good if the demand

Accepted Answer

A) for pizza rises when income rises. 
B) for pizza rises when the price of pizza falls. 
C) curve for pizza slopes upward. 
D) curve for pizza shifts to the right when the price of burritos rises,assuming pizza and burritos are substitutes. 
A) for pizza rises when income rises. 
B) for pizza rises when the price of pizza falls. 
C) curve for pizza slopes upward. 
D) curve for pizza shifts to the right when the price of burritos rises,assuming pizza and burritos are substitutes.

Question 4

Which of the following demonstrates the law of demand?

Accepted Answer

A) After Jon got a raise at work,he bought more pretzels at $1.50 per pretzel than he did before his raise. 
B) Melissa buys fewer muffins at $0.75 per muffin than at $1 per muffin,other things equal. 
C) Dave buys more donuts at $0.25 per donut than at $0.50 per donut,other things equal. 
D) Kendra buys fewer Snickers at $0.60 per Snickers after the price of Milky Ways falls to $0.50 per Milky Way. 
A) After Jon got a raise at work,he bought more pretzels at $1.50 per pretzel than he did before his raise. 
B) Melissa buys fewer muffins at $0.75 per muffin than at $1 per muffin,other things equal. 
C) Dave buys more donuts at $0.25 per donut than at $0.50 per donut,other things equal. 
D) Kendra buys fewer Snickers at $0.60 per Snickers after the price of Milky Ways falls to $0.50 per Milky Way.

Question 5

A table that shows the relationship between the price of a good and the quantity demanded of that good is called a

Accepted Answer

A) price-quantity schedule. 
B) buyer schedule. 
C) demand schedule. 
D) demand curve. 
A) price-quantity schedule. 
B) buyer schedule. 
C) demand schedule. 
D) demand curve.

Question 6

The following table contains a demand schedule for a good.
 
If the law of demand applies to this good,then Q1 could be

Accepted Answer

A) 0. 
B) 100. 
C) 200. 
D) 400. 
A) 0. 
B) 100. 
C) 200. 
D) 400.

Question 7

Today,people changed their expectations about the future.This change

Accepted Answer

A) can cause a movement along a demand curve. 
B) can affect future demand but not today's demand. 
C) can affect today's demand. 
D) cannot affect either today's demand or future demand. 
A) can cause a movement along a demand curve. 
B) can affect future demand but not today's demand. 
C) can affect today's demand. 
D) cannot affect either today's demand or future demand.

Question 8

If a increase in income decreases the demand for a good,then the good is a(n)

Accepted Answer

A) substitute good. 
B) complementary good. 
C) normal good. 
D) inferior good. 
A) substitute good. 
B) complementary good. 
C) normal good. 
D) inferior good.

Question 9

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 10

You lose your job and,as a result,you buy fewer iTunes music downloads.This shows that you consider iTunes music downloads to be a(n)

Accepted Answer

A) luxury good. 
B) inferior good. 
C) normal good. 
D) complementary good. 
A) luxury good. 
B) inferior good. 
C) normal good. 
D) complementary good.

Question 11

If Kindle e-readers and Nook e-readers are substitutes,a higher price for Nooks would result in a(n)

Accepted Answer

A) increase in the demand for Nooks. 
B) decrease in the demand for Nooks. 
C) increase in the demand for Kindles. 
D) decrease in the demand for Kindles. 
A) increase in the demand for Nooks. 
B) decrease in the demand for Nooks. 
C) increase in the demand for Kindles. 
D) decrease in the demand for Kindles.

Question 12

Once the demand curve for a product or service is drawn,it

Accepted Answer

A) remains stable over time. 
B) can shift either rightward or leftward. 
C) is possible to move along the curve,but the curve will not shift. 
D) tends to become steeper over time. 
A) remains stable over time. 
B) can shift either rightward or leftward. 
C) is possible to move along the curve,but the curve will not shift. 
D) tends to become steeper over time.

Question 13

You love peanut butter.You hear on the news that 50 percent of the peanut crop in the South has been wiped out by drought and that this will cause the price of peanuts to double by the end of the year.As a result,your demand for peanut butter

Accepted Answer

A) will increase but not until the end of the year. 
B) increases today. 
C) decreases as you look for a substitute good. 
D) shifts left today. 
A) will increase but not until the end of the year. 
B) increases today. 
C) decreases as you look for a substitute good. 
D) shifts left today.

Question 14

"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." This relationship between price and quantity demanded

Accepted Answer

A) applies to most goods in the economy. 
B) is represented by a downward-sloping demand curve. 
C) is referred to as the law of demand. 
D) All of the above are correct. 
A) applies to most goods in the economy. 
B) is represented by a downward-sloping demand curve. 
C) is referred to as the law of demand. 
D) All of the above are correct.

Question 15

Figure 4-2    
-Refer to Figure 4-2.Suppose Phil and Miss Kay are the only consumers in the market.If the price is $10,then the market quantity demanded is

Accepted Answer

A) 0 units. 
B) 2 units. 
C) 4 units. 
D) 6 units. 
A) 0 units. 
B) 2 units. 
C) 4 units. 
D) 6 units.

Question 16

Which of the following events would cause a movement upward and to the left along the demand curve for olives?

Accepted Answer

A) The number of people who purchase olives decreases. 
B) Consumer income decreases,and olives are a normal good. 
C) The price of pickles decreases,and pickles are a substitute for olives. 
D) The price of olives rises. 
A) The number of people who purchase olives decreases. 
B) Consumer income decreases,and olives are a normal good. 
C) The price of pickles decreases,and pickles are a substitute for olives. 
D) The price of olives rises.

Question 17

Figure 4-7  
-Refer to Figure 4-7.The shift from Da to Db is called

Accepted Answer

A) an increase in demand. 
B) a decrease in demand. 
C) a decrease in quantity demanded. 
D) an increase in quantity demanded. 
A) an increase in demand. 
B) a decrease in demand. 
C) a decrease in quantity demanded. 
D) an increase in quantity demanded.

Question 18

A likely example of complementary goods for most people would be

Accepted Answer

A) butter and margarine. 
B) lawnmowers and automobiles. 
C) chips and salsa. 
D) cola and lemonade. 
A) butter and margarine. 
B) lawnmowers and automobiles. 
C) chips and salsa. 
D) cola and lemonade.

Question 19

Suppose you like to make,from scratch,pies filled with banana cream and vanilla pudding.You notice that the price of bananas has increased.As a result,your demand for vanilla pudding would

Accepted Answer

A) decrease. 
B) increase. 
C) be unaffected. 
D) There is insufficient information given to answer the question. 
A) decrease. 
B) increase. 
C) be unaffected. 
D) There is insufficient information given to answer the question.

Question 20

Figure 4-5  
-Refer to Figure 4-5.Which of the following would cause the demand curve to shift from Demand A to Demand B in the market for oranges in the United States?

Accepted Answer

A) a freeze in Florida 
B) a technological advance that allows oranges to ripen faster 
C) a decrease in the price of apples 
D) an announcement by the FDA that oranges prevent heart disease 
A) a freeze in Florida 
B) a technological advance that allows oranges to ripen faster 
C) a decrease in the price of apples 
D) an announcement by the FDA that oranges prevent heart disease

Exam 4: The Market Forces of Supply and Demand: Demand

A likely example of substitute goods for most people would be

If mayonnaise and Miracle Whip are substitutes,then which of the following would increase the demand for Miracle Whip?

Pizza is a normal good if the demand

Which of the following demonstrates the law of demand?

A table that shows the relationship between the price of a good and the quantity demanded of that good is called a

The following table contains a demand schedule for a good. If the law of demand applies to this good,then Q1 could be

Today,people changed their expectations about the future.This change

If a increase in income decreases the demand for a good,then the good is a(n)

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

You lose your job and,as a result,you buy fewer iTunes music downloads.This shows that you consider iTunes music downloads to be a(n)

If Kindle e-readers and Nook e-readers are substitutes,a higher price for Nooks would result in a(n)

Once the demand curve for a product or service is drawn,it

You love peanut butter.You hear on the news that 50 percent of the peanut crop in the South has been wiped out by drought and that this will cause the price of peanuts to double by the end of the year.As a result,your demand for peanut butter

"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." This relationship between price and quantity demanded

Figure 4-2 -Refer to Figure 4-2.Suppose Phil and Miss Kay are the only consumers in the market.If the price is $10,then the market quantity demanded is

Which of the following events would cause a movement upward and to the left along the demand curve for olives?

Figure 4-7 -Refer to Figure 4-7.The shift from Da to Db is called

A likely example of complementary goods for most people would be

Suppose you like to make,from scratch,pies filled with banana cream and vanilla pudding.You notice that the price of bananas has increased.As a result,your demand for vanilla pudding would

Figure 4-5 -Refer to Figure 4-5.Which of the following would cause the demand curve to shift from Demand A to Demand B in the market for oranges in the United States?

Ten Principles of Economics

Ten Principles of Economics: How People Make Decisions

Ten Principles of Economics: How People Interact

Ten Principles of Economics: How the Economy As a Whole Works

Ten Principles of Economics: Part A

Ten Principles of Economics: Part B

Thinking Like an Economist

Thinking Like an Economist: The Economist As Scientist

Thinking Like an Economist: The Economist As Policy Adviser

Thinking Like an Economist: Why Economists Disagree

Thinking Like an Economist: Lets Get Going

Thinking Like an Economist: Graphing a Brief Review

Thinking Like an Economist: Part A

Thinking Like an Economist: Part B

Interdependence and the Gains From Trade

Interdependence and the Gains From Trade: A Parable for the Modern Economy

Interdependence and the Gains From Trade: Comparative Advantage the Driving Force of Specialization

Interdependence and the Gains From Trade: Applications of Comparative Advantage

Interdependence and the Gains From Trade: Conclusion

Interdependence and the Gains From Trade: Part A

Interdependence and the Gains From Trade: Part B

The Market Forces of Supply and Demand

The Market Forces of Supply and Demand:Markets and Competition

The Market Forces of Supply and Demand: Supply

The Market Forces of Supply and Demand: Supply and Demand Together

The Market Forces of Supply and DemandConclusion How Prices Allocate Resources

The Market Forces of Supply and Demand: Part A

The Market Forces of Supply and Demand: Part B

Elasticity and Its Applications

Elasticity and Its Applications: The Elasticity of Demand

Elasticity and Its Applications: The Elasticity of Supply

Elasticity and Its Applications: Three Applications of Supply,demand,and Elasticity

Elasticity and Its Applications: Part A

Elasticity and Its Applications: Part B

Supply Demand and Government Policies

Supply Demand and Government Policies: Controls on Prices

Supply Demand and Government Policies: Taxes

Supply Demand and Government Policies: Part A

Supply Demand and Government Policies: Part B

Consumers Producers and the Efficiency of Markets

Consumers Producers and the Efficiency of Markets: Consumer Surplus

Consumers Producers and the Efficiency of Markets: Producer Surplus

Consumers Producers and the Efficiency of Markets: Market Efficiency

Consumers Producers and the Efficiency of Markets: Conclusion Market Efficiency and Market Failure

Consumers Producers and the Efficiency of Markets: Part A

Consumers Producers and the Efficiency of Markets: Part B

Application the Cost of Taxation

Application the Cost of Taxation: The Deadweight Loss of Taxation

Application the Cost of Taxation: The Determinants of the Deadweight Loss

Application the Cost of Taxation: Deadweight Loss and Tax Revenue As Taxes Vary

Application the Cost of Taxation: Conclusion

Application the Cost of Taxation: Part A

Application the Cost of Taxation: Part B

Application International Trade

Application International Trade: The Determinants of Trade

Application International Trade: The Winners and Losers From Trade

Application International Trade: The Arguments for Restricting Trade

Application International Trade: Conclusion

Application International Trade: Part A