Question 1

In markets, prices move toward equilibrium because of

Accepted Answer

A) ​the actions of buyers and sellers. 
B) ​government regulations placed on market participants. 
C) ​increased competition among sellers. 
D) ​buyers' ability to affect market outcomes. 
A) ​the actions of buyers and sellers. 
B) ​government regulations placed on market participants. 
C) ​increased competition among sellers. 
D) ​buyers' ability to affect market outcomes.

Question 2

Which of the following would cause an increase in demand for golf balls?

Accepted Answer

A) ​a decrease in the price of golf balls 
B) ​an increase in the price of green fees 
C) ​an expectation by buyers that their incomes will increase in the very near future 
D) ​a change in consumer tastes away from golf and toward tennis 
A) ​a decrease in the price of golf balls 
B) ​an increase in the price of green fees 
C) ​an expectation by buyers that their incomes will increase in the very near future 
D) ​a change in consumer tastes away from golf and toward tennis

Question 3

Suppose roses are currently selling for $20 per dozen, but the equilibrium price of roses is $30 per dozen. We would expect a

Accepted Answer

A) ​shortage to exist and the market price of roses to increase. 
B) ​shortage to exist and the market price of roses to decrease. 
C) ​surplus to exist and the market price of roses to increase. 
D) ​surplus to exist and the market price of roses to decrease. 
A) ​shortage to exist and the market price of roses to increase. 
B) ​shortage to exist and the market price of roses to decrease. 
C) ​surplus to exist and the market price of roses to increase. 
D) ​surplus to exist and the market price of roses to decrease.

Question 4

An increase in the price of Product X leads to a decrease in demand for Product Y. The price increase also increases the demand for Product Z, a related good. Discuss the relationship between these products.

Accepted Answer

Product X and Produc

Question 5

Antonio's makes the greatest pizza and delivers it hot to all the dorms around campus. Last week Antonio's supplier of pepperoni informed him of a 25% increase in price. Which variable determining the position of the supply curve has changed and what effect does it have on supply?

Accepted Answer

A) ​future expectations; supply decreases 
B) ​future expectations; supply increases 
C) ​input prices; supply decreases 
D) ​input prices; supply increases 
A) ​future expectations; supply decreases 
B) ​future expectations; supply increases 
C) ​input prices; supply decreases 
D) ​input prices; supply increases

Question 6

Which of the following is true?

Accepted Answer

A) ​According to the law of supply, the higher the price of the good, the greater the quantity supplied. 
B) ​An individual supply curve is a graphical representation that shows the negative relationship between the price and the quantity an individual is willing and able to supply. 
C) ​The market supply curve is the vertical summation of the individual firm supply curves. 
D) ​An increase in supply is illustrated by an upward shift in the supply curve. 
A) ​According to the law of supply, the higher the price of the good, the greater the quantity supplied. 
B) ​An individual supply curve is a graphical representation that shows the negative relationship between the price and the quantity an individual is willing and able to supply. 
C) ​The market supply curve is the vertical summation of the individual firm supply curves. 
D) ​An increase in supply is illustrated by an upward shift in the supply curve.

Question 7

A movement along the demand curve might be caused by a change in

Accepted Answer

A) ​income. 
B) ​the prices of substitutes or complements. 
C) ​expectations about future prices. 
D) ​the price of the good or service that is being demanded. 
A) ​income. 
B) ​the prices of substitutes or complements. 
C) ​expectations about future prices. 
D) ​the price of the good or service that is being demanded.

Question 8

If the price of ice cream increases and the quantity demanded decreases, economists would describe this as:

Accepted Answer

A) ​a change in demand. 
B) ​a change in quantity demanded. 
C) ​a change in consumer income. 
D) ​a change in one of the variables that shift demand. 
A) ​a change in demand. 
B) ​a change in quantity demanded. 
C) ​a change in consumer income. 
D) ​a change in one of the variables that shift demand.

Question 9

Which of the following would not shift the supply curve for halibut?

Accepted Answer

A) ​a reduction in the number of available fishing boats 
B) ​unusually stormy weather during fishing season 
C) ​the development of innovative new fishing equipment that makes it easier to catch halibut 
D) ​an increase in the price of halibut 
A) ​a reduction in the number of available fishing boats 
B) ​unusually stormy weather during fishing season 
C) ​the development of innovative new fishing equipment that makes it easier to catch halibut 
D) ​an increase in the price of halibut

Question 10

Which of the following is not a determinant of supply?

Accepted Answer

A) ​input prices 
B) ​technology 
C) ​tastes 
D) ​expectations 
A) ​input prices 
B) ​technology 
C) ​tastes 
D) ​expectations

Question 11

Either an increase in the number of buyers or an increase in tastes or preferences for a good or service will increase the market demand for that good or service.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following relationships reflect the law of supply?

Accepted Answer

A) ​an increase in QS => a decrease in Price 
B) ​a decrease in Price => an increase in supply 
C) ​an increase in Price => an increase in QS 
D) ​a decrease in Price => an increase in QS 
A) ​an increase in QS => a decrease in Price 
B) ​a decrease in Price => an increase in supply 
C) ​an increase in Price => an increase in QS 
D) ​a decrease in Price => an increase in QS

Question 13

A decrease in the price of a good would

Accepted Answer

A) ​increase the supply of the good. 
B) ​increase the quantity demanded of the good. 
C) ​give producers an incentive to produce more to keep profits from falling. 
D) ​shift the supply curve for the good to the left. 
A) ​increase the supply of the good. 
B) ​increase the quantity demanded of the good. 
C) ​give producers an incentive to produce more to keep profits from falling. 
D) ​shift the supply curve for the good to the left.

Question 14

Today's demand curve for gasoline could shift in response to

Accepted Answer

A) ​a change in today's price of gasoline. 
B) ​a change in the expected future price of gasoline. 
C) ​a change in the number of sellers of gasoline. 
D) ​All of the above are correct. 
A) ​a change in today's price of gasoline. 
B) ​a change in the expected future price of gasoline. 
C) ​a change in the number of sellers of gasoline. 
D) ​All of the above are correct.

Question 15

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 16

Buyers who were originally willing to buy 800 units of a good at $4 per unit are now willing to buy 1200 units at $4 per unit. That change would be described as:

Accepted Answer

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

Question 17

Two goods are substitutes when a decrease in the price of one good

Accepted Answer

A) ​decreases the demand for the other good. 
B) ​decreases the quantity demanded of the other good. 
C) ​increases the demand for the other good. 
D) ​increases the quantity demanded of the other good. 
A) ​decreases the demand for the other good. 
B) ​decreases the quantity demanded of the other good. 
C) ​increases the demand for the other good. 
D) ​increases the quantity demanded of the other good.

Question 18

An increase in the price of a good will

Accepted Answer

A) ​increase demand. 
B) ​decrease demand. 
C) ​increase quantity demanded. 
D) ​decrease quantity demanded. 
A) ​increase demand. 
B) ​decrease demand. 
C) ​increase quantity demanded. 
D) ​decrease quantity demanded.

Question 19

Which of the following would cause an increase in the demand curve for oranges?

Accepted Answer

A) ​a freeze in Florida (a major orange producing state) 
B) ​a new machine that allows orange growers to harvest oranges faster 
C) ​a decrease in the price of apples 
D) ​an announcement by the FDA that oranges lowers cholesterol 
A) ​a freeze in Florida (a major orange producing state) 
B) ​a new machine that allows orange growers to harvest oranges faster 
C) ​a decrease in the price of apples 
D) ​an announcement by the FDA that oranges lowers cholesterol

Question 20

​Exhibit 4-5  
-Refer to Exhibit 4-5. A change from Point A to Point E represents a(n):

Accepted Answer

A) ​increase in supply. 
B) ​decrease in supply 
C) ​increase in quantity supplied. 
D) ​decrease in quantity supplied. 
A) ​increase in supply. 
B) ​decrease in supply 
C) ​increase in quantity supplied. 
D) ​decrease in quantity supplied.

Exam 4: Demand, Supply, and Market Equilibrium

In markets, prices move toward equilibrium because of

Which of the following would cause an increase in demand for golf balls?

Suppose roses are currently selling for $20 per dozen, but the equilibrium price of roses is $30 per dozen. We would expect a

An increase in the price of Product X leads to a decrease in demand for Product Y. The price increase also increases the demand for Product Z, a related good. Discuss the relationship between these products.

Antonio's makes the greatest pizza and delivers it hot to all the dorms around campus. Last week Antonio's supplier of pepperoni informed him of a 25% increase in price. Which variable determining the position of the supply curve has changed and what effect does it have on supply?

Which of the following is true?

A movement along the demand curve might be caused by a change in

If the price of ice cream increases and the quantity demanded decreases, economists would describe this as:

Which of the following would not shift the supply curve for halibut?

Which of the following is not a determinant of supply?

Either an increase in the number of buyers or an increase in tastes or preferences for a good or service will increase the market demand for that good or service.

Which of the following relationships reflect the law of supply?

A decrease in the price of a good would

Today's demand curve for gasoline could shift in response to

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:

Buyers who were originally willing to buy 800 units of a good at $4 per unit are now willing to buy 1200 units at $4 per unit. That change would be described as:

Two goods are substitutes when a decrease in the price of one good

An increase in the price of a good will

Which of the following would cause an increase in the demand curve for oranges?

​Exhibit 4-5 -Refer to Exhibit 4-5. A change from Point A to Point E represents a(n):

The Role and Method of Economics

Eight Powerful Ideas

Scarcity, Trade-Offs, and Production Possibilities

Market in Motion and Price Controls

Elasticities

Market Efficiency and Welfare

Market Failure

Public Finance and Public Choice

Consumer Choice Theory

The Firm: Production and Costs

Firms in Perfectly Competitive Markets

Monopoly and Antitrust

Monopolistic Competition and Product Differentiation

Oligopoly and Strategic Behavior

The Markets for Labor, Capital, and Land

Income, Poverty and Health Care

Introduction to Macroeconomics: Unemployment, Inflation, and Economic Fluctuations

Measuring Economic Performance

Economic Growth in the Global Economy

Financial Markets, Saving, and Investment

Filters

Exhibit 4-5 -Refer to Exhibit 4-5. A change from Point A to Point E represents a(n):