Question 1

The market for ice cream is a

Accepted Answer

A)  monopolistic market. 
B)  highly competitive market. 
C)  highly organized market. 
D)  Both b and c are correct. 
A)  monopolistic market. 
B)  highly competitive market. 
C)  highly organized market. 
D)  Both b and c are correct.

Question 2

Buyers and sellers who have no influence on market price are referred to as

Accepted Answer

A)  market pawns. 
B)  monopolists. 
C)  price takers. 
D)  price setters. 
A)  market pawns. 
B)  monopolists. 
C)  price takers. 
D)  price setters.

Question 3

The signals that guide the allocation of resources in a market economy are

Accepted Answer

A)  surpluses and shortages. 
B)  quantities. 
C)  government policies. 
D)  prices. 
A)  surpluses and shortages. 
B)  quantities. 
C)  government policies. 
D)  prices.

Question 4

Table 4-11
  
-Refer to Table 4-11. The equilibrium price and quantity, respectively, are

Accepted Answer

A)  $2 and 50 units. 
B)  $6 and 30 units. 
C)  $6 and 60 units. 
D)  $12 and 30 units. 
A)  $2 and 50 units. 
B)  $6 and 30 units. 
C)  $6 and 60 units. 
D)  $12 and 30 units.

Question 5

Suppose buyers of computers and printers regard the two goods as complements. Then an increase in the price of computers will cause an)

Accepted Answer

A)  decrease in the demand for printers and a decrease in the quantity supplied of printers. 
B)  decrease in the supply of printers and a decrease in the quantity demanded of printers. 
C)  decrease in the equilibrium price of printers and an increase in the equilibrium quantity of printers. 
D)  increase in the equilibrium price of printers and a decrease in the equilibrium quantity of printers. 
A)  decrease in the demand for printers and a decrease in the quantity supplied of printers. 
B)  decrease in the supply of printers and a decrease in the quantity demanded of printers. 
C)  decrease in the equilibrium price of printers and an increase in the equilibrium quantity of printers. 
D)  increase in the equilibrium price of printers and a decrease in the equilibrium quantity of printers.

Question 6

A shortage is the same as an excess demand.

Accepted Answer

A) True 
 B)False

Question 7

The line that relates the price of a good and the quantity supplied of that good is called the supply

Accepted Answer

A)  schedule, and it usually slopes upward. 
B)  schedule, and it usually slopes downward. 
C)  curve, and it usually slopes upward. 
D)  curve, and it usually slopes downward. 
A)  schedule, and it usually slopes upward. 
B)  schedule, and it usually slopes downward. 
C)  curve, and it usually slopes upward. 
D)  curve, and it usually slopes downward.

Question 8

A improvement in production technology will shift the

Accepted Answer

A)  supply curve to the right. 
B)  supply curve to the left. 
C)  demand curve to the right. 
D)  demand curve to the left. 
A)  supply curve to the right. 
B)  supply curve to the left. 
C)  demand curve to the right. 
D)  demand curve to the left.

Question 9

Which of the following events could shift the demand curve for gasoline to the left?

Accepted Answer

A)  The income of gasoline buyers rises, and gasoline is a normal good. 
B)  The income of gasoline buyers falls, and gasoline is an inferior good. 
C)  Public service announcements run on television encourage people to walk or ride bicycles instead of driving cars. 
D)  The price of gasoline rises. 
A)  The income of gasoline buyers rises, and gasoline is a normal good. 
B)  The income of gasoline buyers falls, and gasoline is an inferior good. 
C)  Public service announcements run on television encourage people to walk or ride bicycles instead of driving cars. 
D)  The price of gasoline rises.

Question 10

Table 4-5
The table below shows the quantities demanded of cases of Mt. Dew per month by four families at various prices.
  
-Refer to Table 4-5. Which of the following could cause all four families to demand more Mt. Dew at all prices?

Accepted Answer

A)  The price of sugar decreases. 
B)  All four family incomes increase, and Mt. Dew is a normal good. 
C)  A major university study reveals that drinking Mt. Dew can cause diabetes. 
D)  The technology for bottling carbonated beverages improves. 
A)  The price of sugar decreases. 
B)  All four family incomes increase, and Mt. Dew is a normal good. 
C)  A major university study reveals that drinking Mt. Dew can cause diabetes. 
D)  The technology for bottling carbonated beverages improves.

Question 11

The quantity demanded of a good is the amount that buyers are

Accepted Answer

A)  willing to purchase. 
B)  willing and able to purchase. 
C)  willing, able, and need to purchase. 
D)  able to purchase. 
A)  willing to purchase. 
B)  willing and able to purchase. 
C)  willing, able, and need to purchase. 
D)  able to purchase.

Question 12

During the last few decades in the United States, health officials have argued that eating too much beef might be harmful to human health. As a result, there has been a significant decrease in the amount of beef produced. Which of the following best explains the decrease in production?

Accepted Answer

A)  Beef producers, concerned about the health of their customers, decided to produce relatively less beef. 
B)  Government officials, concerned about consumer health, ordered beef producers to produce relatively less beef. 
C)  Individual consumers, concerned about their own health, decreased their demand for beef, which lowered the equilibrium price of beef, making it less attractive to produce. 
D)  Anti-beef protesters have made it difficult for both buyers and sellers of beef to meet in the marketplace. 
A)  Beef producers, concerned about the health of their customers, decided to produce relatively less beef. 
B)  Government officials, concerned about consumer health, ordered beef producers to produce relatively less beef. 
C)  Individual consumers, concerned about their own health, decreased their demand for beef, which lowered the equilibrium price of beef, making it less attractive to produce. 
D)  Anti-beef protesters have made it difficult for both buyers and sellers of beef to meet in the marketplace.

Question 13

Figure 4-4
Yasmine 
  
Mercedes  
-Refer to Figure 4-4. Suppose Yasmine and Mercedes are the only two consumers in the market. When the market price falls from $12 to $6, the quantity demanded increases by

Accepted Answer

A)  6 units. 
B)  9 units. 
C)  12 units. 
D)  15 units. 
A)  6 units. 
B)  9 units. 
C)  12 units. 
D)  15 units.

Question 14

Figure 4-27

-Refer to Figure 4-27. Which of the four panels illustrates a decrease in quantity supplied?

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 15

Figure 4-22  
-Refer to Figure 4-22. What is the equilibrium price in this market?

Accepted Answer

A)  $8 
B)  $12 
C)  $16 
D)  $20 
A)  $8 
B)  $12 
C)  $16 
D)  $20

Question 16

In a competitive market, the quantity of a product produced and the price of the product are determined by

Accepted Answer

A)  buyers. 
B)  sellers. 
C)  both buyers and sellers. 
D)  None of the above is correct. 
A)  buyers. 
B)  sellers. 
C)  both buyers and sellers. 
D)  None of the above is correct.

Question 17

Sellers respond to a surplus by cutting their prices.

Accepted Answer

A) True 
 B)False

Question 18

A downward-sloping demand curve illustrates

Accepted Answer

A)  that demand decreases over time. 
B)  that prices fall over time. 
C)  the relationship between income and quantity demanded. 
D)  the law of demand. 
A)  that demand decreases over time. 
B)  that prices fall over time. 
C)  the relationship between income and quantity demanded. 
D)  the law of demand.

Question 19

Figure 4-8  
-Refer to Figure 4-8. Suppose the figure shows the market demand for coffee. Suppose the price of tea, a substitute good, increases. Which of the following changes would occur?

Accepted Answer

A)  a movement along D2 from point A to point B 
B)  a movement along D2 from point B to point A 
C)  a shift from D1 to D2 
D)  a shift from D2 to D1 
A)  a movement along D2 from point A to point B 
B)  a movement along D2 from point B to point A 
C)  a shift from D1 to D2 
D)  a shift from D2 to D1

Question 20

Figure 4-7  
-Refer to Figure 4-7. The movement from Db to Da could be caused by

Accepted Answer

A)  a decrease in price. 
B)  an increase in the price of a complement. 
C)  a technological advance. 
D)  an increase in the price of a substitute. 
A)  a decrease in price. 
B)  an increase in the price of a complement. 
C)  a technological advance. 
D)  an increase in the price of a substitute.

The market for ice cream is a

Buyers and sellers who have no influence on market price are referred to as

The signals that guide the allocation of resources in a market economy are

Table 4-11 -Refer to Table 4-11. The equilibrium price and quantity, respectively, are

Suppose buyers of computers and printers regard the two goods as complements. Then an increase in the price of computers will cause an)

A shortage is the same as an excess demand.

The line that relates the price of a good and the quantity supplied of that good is called the supply

A improvement in production technology will shift the

Which of the following events could shift the demand curve for gasoline to the left?

Table 4-5 The table below shows the quantities demanded of cases of Mt. Dew per month by four families at various prices. -Refer to Table 4-5. Which of the following could cause all four families to demand more Mt. Dew at all prices?

The quantity demanded of a good is the amount that buyers are

During the last few decades in the United States, health officials have argued that eating too much beef might be harmful to human health. As a result, there has been a significant decrease in the amount of beef produced. Which of the following best explains the decrease in production?

Figure 4-4 Yasmine Mercedes -Refer to Figure 4-4. Suppose Yasmine and Mercedes are the only two consumers in the market. When the market price falls from $12 to $6, the quantity demanded increases by

Figure 4-27 -Refer to Figure 4-27. Which of the four panels illustrates a decrease in quantity supplied?

Figure 4-22 -Refer to Figure 4-22. What is the equilibrium price in this market?

In a competitive market, the quantity of a product produced and the price of the product are determined by

Sellers respond to a surplus by cutting their prices.

A downward-sloping demand curve illustrates

Figure 4-8 -Refer to Figure 4-8. Suppose the figure shows the market demand for coffee. Suppose the price of tea, a substitute good, increases. Which of the following changes would occur?

Figure 4-7 -Refer to Figure 4-7. The movement from Db to Da could be caused by

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

The Basic Tools of Finance

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

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Exam 4: The Market Forces of Supply and Demand

The market for ice cream is a

Buyers and sellers who have no influence on market price are referred to as

The signals that guide the allocation of resources in a market economy are

Table 4-11 -Refer to Table 4-11. The equilibrium price and quantity, respectively, are

Suppose buyers of computers and printers regard the two goods as complements. Then an increase in the price of computers will cause an)

A shortage is the same as an excess demand.

The line that relates the price of a good and the quantity supplied of that good is called the supply

A improvement in production technology will shift the

Which of the following events could shift the demand curve for gasoline to the left?

Table 4-5 The table below shows the quantities demanded of cases of Mt. Dew per month by four families at various prices. -Refer to Table 4-5. Which of the following could cause all four families to demand more Mt. Dew at all prices?

The quantity demanded of a good is the amount that buyers are

During the last few decades in the United States, health officials have argued that eating too much beef might be harmful to human health. As a result, there has been a significant decrease in the amount of beef produced. Which of the following best explains the decrease in production?

Figure 4-4 Yasmine Mercedes -Refer to Figure 4-4. Suppose Yasmine and Mercedes are the only two consumers in the market. When the market price falls from $12 to $6, the quantity demanded increases by

Figure 4-27 -Refer to Figure 4-27. Which of the four panels illustrates a decrease in quantity supplied?

Figure 4-22 -Refer to Figure 4-22. What is the equilibrium price in this market?

In a competitive market, the quantity of a product produced and the price of the product are determined by

Sellers respond to a surplus by cutting their prices.

A downward-sloping demand curve illustrates

Figure 4-8 -Refer to Figure 4-8. Suppose the figure shows the market demand for coffee. Suppose the price of tea, a substitute good, increases. Which of the following changes would occur?

Figure 4-7 -Refer to Figure 4-7. The movement from Db to Da could be caused by

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

The Basic Tools of Finance

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

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