Question 1

If the electronics market is experiencing a shortage in the supply of mobile phones being sold at a cost that buyers are more than willing to pay for, then:

Accepted Answer

A) the selling price is higher than the equilibrium price 
B) the equilibrium price is higher than the selling price. 
C) the quantity demanded is less than the quantity supplied. 
D) the shortage could be eliminated by lowering the price. 
A) the selling price is higher than the equilibrium price 
B) the equilibrium price is higher than the selling price. 
C) the quantity demanded is less than the quantity supplied. 
D) the shortage could be eliminated by lowering the price.

Question 2

Table 3-D
Use the following information about demand and supply schedules to answer the question.
 $$\begin{array} { l c c c } 
\text { Price } & \mathbf { D } _ { 1 } & \mathbf { D } _ { \mathbf { 2 } } & \boldsymbol { I } _ { \mathbf { 1 } } \
\$ 12 & 5 & 9 & 19 \
\$ 10 & 8 & 12 & 17 \
\$ 8 & 11 & 15 & 15 \
\$ 6 & 13 & 18 & 13 \
\$ 4 & 16 & 21 & 11 \
\$ 2 & 18 & 24 & 9
\end{array}$$
-Refer to Table 3-D.If D1 and S2 represent the demand and supply schedules in a particular market, the equilibrium price and quantity are ____ and ____, respectively.

Accepted Answer

A) $12; 9 
B) $10; 12 
C) $10; 8 
D) $8; 11 
E) between $8 and $10; between 10 and 12 
A) $12; 9 
B) $10; 12 
C) $10; 8 
D) $8; 11 
E) between $8 and $10; between 10 and 12

Question 3

Figure 3-K  
-Refer to Figure 3-K.The equilibrium price is:

Accepted Answer

A) $3 
B) $1 
C) $4 
D) Indeterminate 
A) $3 
B) $1 
C) $4 
D) Indeterminate

Question 4

A demand curve shows the relationship between price and quantity demanded, "other things remaining constant." The other things that remain constant include all of the following except the:

Accepted Answer

A) price of the product. 
B) price of complementary products. 
C) price of substitute products. 
D) number of consumers in the demographic group purchasing the product. 
E) preferences of consumers. 
A) price of the product. 
B) price of complementary products. 
C) price of substitute products. 
D) number of consumers in the demographic group purchasing the product. 
E) preferences of consumers.

Question 5

American consumers decide to boycott soccer balls made by Nike in support of a ban on child labor.Everything else being equal, the:

Accepted Answer

A) price of Nike soccer balls will rise. 
B) supply of Nike soccer balls will fall. 
C) quantity of Nike soccer balls supplied will fall. 
D) demand curve for Nike soccer balls shifts to the right. 
A) price of Nike soccer balls will rise. 
B) supply of Nike soccer balls will fall. 
C) quantity of Nike soccer balls supplied will fall. 
D) demand curve for Nike soccer balls shifts to the right.

Question 6

Figure 3-K  
-Refer to Figure 3-K.At a market price of $2, which of following conditions exist?

Accepted Answer

A) Shortage 
B) Surplus 
C) Equilibrium 
D) Either a or b 
A) Shortage 
B) Surplus 
C) Equilibrium 
D) Either a or b

Question 7

Which of the following is the correct way to describe equilibrium in a market?

Accepted Answer

A) At equilibrium, demand equals supply. 
B) At equilibrium, quantity demanded equals quantity supplied. 
C) At equilibrium, market forces no longer apply. 
D) Equilibrium is a tendency for price to change, a state of perpetual motion. 
E) At equilibrium, the "fairest" price for output is achieved. 
A) At equilibrium, demand equals supply. 
B) At equilibrium, quantity demanded equals quantity supplied. 
C) At equilibrium, market forces no longer apply. 
D) Equilibrium is a tendency for price to change, a state of perpetual motion. 
E) At equilibrium, the "fairest" price for output is achieved.

Question 8

Other things constant, a decrease in the price of fertilizer will:

Accepted Answer

A) increase the supply of wheat. 
B) decrease the supply of wheat. 
C) increase the demand for wheat. 
D) decrease the demand for wheat. 
E) do none of the above. 
A) increase the supply of wheat. 
B) decrease the supply of wheat. 
C) increase the demand for wheat. 
D) decrease the demand for wheat. 
E) do none of the above.

Question 9

Ceteris paribus, if negotiations lead to lower wages for airline employees, what will be the result in the market for air travel?

Accepted Answer

A) an increase in equilibrium price and an increase in equilibrium quantity 
B) an increase in equilibrium price and a decrease in equilibrium quantity 
C) a decrease in equilibrium price and an increase in equilibrium quantity 
D) a decrease in equilibrium price and a decrease in equilibrium quantity 
E) an increase in equilibrium price and an indeterminate change in equilibrium quantity 
A) an increase in equilibrium price and an increase in equilibrium quantity 
B) an increase in equilibrium price and a decrease in equilibrium quantity 
C) a decrease in equilibrium price and an increase in equilibrium quantity 
D) a decrease in equilibrium price and a decrease in equilibrium quantity 
E) an increase in equilibrium price and an indeterminate change in equilibrium quantity

Question 10

Table 3-D
Use the following information about demand and supply schedules to answer the question.
 $$\begin{array} { l c c c } 
\text { Price } & \mathbf { D } _ { 1 } & \mathbf { D } _ { \mathbf { 2 } } & \boldsymbol { I } _ { \mathbf { 1 } } \
\$ 12 & 5 & 9 & 19 \
\$ 10 & 8 & 12 & 17 \
\$ 8 & 11 & 15 & 15 \
\$ 6 & 13 & 18 & 13 \
\$ 4 & 16 & 21 & 11 \
\$ 2 & 18 & 24 & 9
\end{array}$$
-Refer to Table 3-D.Suppose that D2 and S1 are the prevailing demand and supply curves for a product.If the supply schedule changes from S1 to S2, then:

Accepted Answer

A) equilibrium price decreases from $10 to $8. 
B) equilibrium quantity decreases from 15 to 12. 
C) equilibrium quantity increases from 10 to 12. 
D) equilibrium price increases from $10 to $12. 
E) equilibrium quantity remains at 15. 
A) equilibrium price decreases from $10 to $8. 
B) equilibrium quantity decreases from 15 to 12. 
C) equilibrium quantity increases from 10 to 12. 
D) equilibrium price increases from $10 to $12. 
E) equilibrium quantity remains at 15.

Question 11

Whenever there is a surplus at a particular price, the quantity sold at that price will equal:

Accepted Answer

A) the quantity demanded at that price. 
B) the quantity supplied minus the quantity demanded. 
C) the quantity supplied at that price. 
D) (quantity demanded plus quantity supplied)/2. 
A) the quantity demanded at that price. 
B) the quantity supplied minus the quantity demanded. 
C) the quantity supplied at that price. 
D) (quantity demanded plus quantity supplied)/2.

Question 12

If both the supply and demand curves shift to the left, then we can conclude that there will be a(n):

Accepted Answer

A) increase in the equilibrium quantity sold. 
B) decrease in the equilibrium quantity sold. 
C) increase in the equilibrium price. 
D) decrease in the equilibrium price. 
E) a change in quantity that is indeterminate. 
A) increase in the equilibrium quantity sold. 
B) decrease in the equilibrium quantity sold. 
C) increase in the equilibrium price. 
D) decrease in the equilibrium price. 
E) a change in quantity that is indeterminate.

Question 13

Which of the following would shift a supply curve to the right?

Accepted Answer

A) Taxes 
B) Import restrictions 
C) Duties 
D) Subsidies 
A) Taxes 
B) Import restrictions 
C) Duties 
D) Subsidies

Question 14

When a demand schedule is drawn in a graph:

Accepted Answer

A) price is measured on the vertical axis. 
B) quantity is measured on the horizontal axis. 
C) the resulting curve has a negative slope. 
D) other variables are held constant. 
E) all of the above are correct. 
A) price is measured on the vertical axis. 
B) quantity is measured on the horizontal axis. 
C) the resulting curve has a negative slope. 
D) other variables are held constant. 
E) all of the above are correct.

Question 15

Figure 3-G
The diagram below represents the market for butter.  
-Refer to Figure 3-G If the current price of butter equals $5, you would expect to find:

Accepted Answer

A) the market in equilibrium at 2,000 pounds per year. 
B) the market in equilibrium at 8,000 pounds per year. 
C) that the market is not in equilibrium, and that the quantity supplied is greater than the quantity demanded. 
D) that the market is not in equilibrium, and that the quantity demanded is greater than the quantity supplied. 
A) the market in equilibrium at 2,000 pounds per year. 
B) the market in equilibrium at 8,000 pounds per year. 
C) that the market is not in equilibrium, and that the quantity supplied is greater than the quantity demanded. 
D) that the market is not in equilibrium, and that the quantity demanded is greater than the quantity supplied.

Question 16

If both the supply and demand for computer games increase, then the equilibrium price of the games:

Accepted Answer

A) is indeterminate and the equilibrium quantity rises. 
B) is indeterminate and the equilibrium quantity falls. 
C) falls and the equilibrium quantity also falls. 
D) falls and the change in equilibrium quantity is indeterminate. 
A) is indeterminate and the equilibrium quantity rises. 
B) is indeterminate and the equilibrium quantity falls. 
C) falls and the equilibrium quantity also falls. 
D) falls and the change in equilibrium quantity is indeterminate.

Question 17

A simultaneous increase in demand and decrease in supply would lead to:

Accepted Answer

A) increase in the equilibrium price and a decrease in the quantity sold. 
B) increase in both the equilibrium price and the quantity sold. 
C) decrease in both the equilibrium price and the quantity sold. 
D) uncertain effect on the equilibrium price but an increase in the equilibrium quantity. 
E) uncertain effect on the equilibrium quantity but an increase in the equilibrium price. 
A) increase in the equilibrium price and a decrease in the quantity sold. 
B) increase in both the equilibrium price and the quantity sold. 
C) decrease in both the equilibrium price and the quantity sold. 
D) uncertain effect on the equilibrium price but an increase in the equilibrium quantity. 
E) uncertain effect on the equilibrium quantity but an increase in the equilibrium price.

Question 18

Figure 3-H  
-Refer to Figure 3-H.A decrease in the quantity demanded, but not a decrease in demand, occurs when the equilibrium moves from:

Accepted Answer

A) Point B to Point D. 
B) Point D to Point B. 
C) Point D to Point C. 
D) Point C to Point D. 
E) None of the above are correct. 
A) Point B to Point D. 
B) Point D to Point B. 
C) Point D to Point C. 
D) Point C to Point D. 
E) None of the above are correct.

Question 19

Suppose there is a reduction in consumer income and an increase in the price of jet fuel, an important resource used to produce air travel.If air travel is a normal good, how will these changes influence the price and quantity of air travel? The price of air travel will (be) ____ and quantity purchased will (be) ____.

Accepted Answer

A) decrease; indeterminate 
B) increase; indeterminate 
C) decrease; decrease 
D) indeterminate; decrease 
A) decrease; indeterminate 
B) increase; indeterminate 
C) decrease; decrease 
D) indeterminate; decrease

Question 20

Table 3-C
 $$\begin{array} { | c | c | c | } 
\hline \text { PRICE music downloads } & \begin{array} { c } 
\text { QUANTITY DEMANDED } \
\text { music downloads }
\end{array} & \begin{array} { c } 
\text { QUANTITY SUPPLIED } \
\text { music downloads }
\end{array} \
\hline \text { \$2.00 } & 1,000,000 \text { urits } & 5,500,000 \text { urits } \
\hline 1.80 & 2,000,000 \text { units } & 5,00,000 \text { units } \
\hline 1.60 & 3,000,000 \text { units } & 4,50,000 \text { units } \
\hline 1.40 & 4,000,000 \text { units } & 4,000,000 \text { units } \
\hline 1.20 & 5,000,000 \text { units } & 3,500,000 \text { units } \
\hline 1.00 & 6,000,000 \text { units } & 3,000,000 \text { units } \
\hline 0.80 & 7,000,000 \text { units } & 2,500,000 \text { units } \
\hline 0.65 & 8,000,000 \text { units } & 2,000,000 \text { units } \
\hline 0.40 & 9,000,000 \text { units } & 1,500,000 \text { units } \
\hline 0.20 & 10,000,000 \text { units } & 1,000,000 \text { units } \
\hline
\end{array}$$
-Refer to Table 3-C.What is the equilibrium price in the example?

Accepted Answer

A) $1.60 
B) $1.40 
C) $1.20 
D) $1.00 
E) $0.80 
A) $1.60 
B) $1.40 
C) $1.20 
D) $1.00 
E) $0.80

If the electronics market is experiencing a shortage in the supply of mobile phones being sold at a cost that buyers are more than willing to pay for, then:

Figure 3-K -Refer to Figure 3-K.The equilibrium price is:

A demand curve shows the relationship between price and quantity demanded, "other things remaining constant." The other things that remain constant include all of the following except the:

American consumers decide to boycott soccer balls made by Nike in support of a ban on child labor.Everything else being equal, the:

Figure 3-K -Refer to Figure 3-K.At a market price of $2, which of following conditions exist?

Which of the following is the correct way to describe equilibrium in a market?

Other things constant, a decrease in the price of fertilizer will:

Ceteris paribus, if negotiations lead to lower wages for airline employees, what will be the result in the market for air travel?

Whenever there is a surplus at a particular price, the quantity sold at that price will equal:

If both the supply and demand curves shift to the left, then we can conclude that there will be a(n):

Which of the following would shift a supply curve to the right?

When a demand schedule is drawn in a graph:

Figure 3-G The diagram below represents the market for butter. -Refer to Figure 3-G If the current price of butter equals $5, you would expect to find:

If both the supply and demand for computer games increase, then the equilibrium price of the games:

A simultaneous increase in demand and decrease in supply would lead to:

Figure 3-H -Refer to Figure 3-H.A decrease in the quantity demanded, but not a decrease in demand, occurs when the equilibrium moves from:

The Role and Method of Economics

The Economic Way of Thinking

Using Supply and Demand

Market Failure and Public Choice

Production and Costs

Firms in Competitive Markets

Monopoly

Monopolistic Competition and Oligopoly

Labor Markets, Income Distribution, and Poverty

Introduction to Macroeconomics: Unemployment, Inflation, and Economic Fluctuations

Economic Growth

Aggregate Demand and Aggregate Supply

Fiscal Policy

Monetary Institutions

The Federal Reserve System and Monetary Policy

Issues in Macroeconomic Theory and Policy

International Economics

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Exam 3: Supply and Demand

If the electronics market is experiencing a shortage in the supply of mobile phones being sold at a cost that buyers are more than willing to pay for, then:

Figure 3-K -Refer to Figure 3-K.The equilibrium price is:

A demand curve shows the relationship between price and quantity demanded, "other things remaining constant." The other things that remain constant include all of the following except the:

American consumers decide to boycott soccer balls made by Nike in support of a ban on child labor.Everything else being equal, the:

Figure 3-K -Refer to Figure 3-K.At a market price of $2, which of following conditions exist?

Which of the following is the correct way to describe equilibrium in a market?

Other things constant, a decrease in the price of fertilizer will:

Ceteris paribus, if negotiations lead to lower wages for airline employees, what will be the result in the market for air travel?

Whenever there is a surplus at a particular price, the quantity sold at that price will equal:

If both the supply and demand curves shift to the left, then we can conclude that there will be a(n):

Which of the following would shift a supply curve to the right?

When a demand schedule is drawn in a graph:

Figure 3-G The diagram below represents the market for butter. -Refer to Figure 3-G If the current price of butter equals $5, you would expect to find:

If both the supply and demand for computer games increase, then the equilibrium price of the games:

A simultaneous increase in demand and decrease in supply would lead to:

Figure 3-H -Refer to Figure 3-H.A decrease in the quantity demanded, but not a decrease in demand, occurs when the equilibrium moves from:

The Role and Method of Economics

The Economic Way of Thinking

Using Supply and Demand

Market Failure and Public Choice

Production and Costs

Firms in Competitive Markets

Monopoly

Monopolistic Competition and Oligopoly

Labor Markets, Income Distribution, and Poverty

Introduction to Macroeconomics: Unemployment, Inflation, and Economic Fluctuations

Economic Growth

Aggregate Demand and Aggregate Supply

Fiscal Policy

Monetary Institutions

The Federal Reserve System and Monetary Policy

Issues in Macroeconomic Theory and Policy

International Economics

Filters