Question 1

Figure 4-7  
-Refer to Figure 4-7. If the demand curve for Good X shifts from Da to Db, then

Accepted Answer

A)  firms would be willing to supply less of Good X than before at each possible price. 
B)  people are willing to buy more of Good X than before at each possible price. 
C)  people's incomes must have decreased. 
D)  the price of Good X has decreased. 
A)  firms would be willing to supply less of Good X than before at each possible price. 
B)  people are willing to buy more of Good X than before at each possible price. 
C)  people's incomes must have decreased. 
D)  the price of Good X has decreased.

Question 2

A market is a group of buyers and sellers of a particular good or service.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following is a determinant of the market supply curve but not a determinant of an individual seller's supply?

Accepted Answer

A)  production technology 
B)  expectations 
C)  input prices 
D)  the number of sellers 
A)  production technology 
B)  expectations 
C)  input prices 
D)  the number of sellers

Question 4

Table 4-6
  
-Refer to Table 4-6. If these are the only four sellers in the market, then the market quantity supplied at a price of $10 is

Accepted Answer

A)  3 units. 
B)  11 units. 
C)  25 units. 
D)  44 units. 
A)  3 units. 
B)  11 units. 
C)  25 units. 
D)  44 units.

Question 5

Suppose goods A and B are substitutes. If the price of good A increases, will the demand for good B increase or decrease?

Accepted Answer

The demand

Question 6

Figure 4-27
Panel a) Panel b)
     Panel c) Panel d)
    
-Refer to Figure 4-27. Which of the four panels illustrates an increase 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 7

Figure 4-11  
-Refer to Figure 4-11. The movement from point A to point B on the graph is called

Accepted Answer

A)  a decrease in supply. 
B)  an increase in supply. 
C)  an increase in the quantity supplied. 
D)  a decrease in the quantity supplied. 
A)  a decrease in supply. 
B)  an increase in supply. 
C)  an increase in the quantity supplied. 
D)  a decrease in the quantity supplied.

Question 8

Figure 4-25
The graph below pertains to the supply of paper to colleges and universities.  
-Refer to Figure 4-25. All else equal, sellers expecting the price of paper to decrease next month when many college students leave campuses for the summer would cause a current move from

Accepted Answer

A)  x to y. 
B)  y to x. 
C)  SA to SB. 
D)  SB to SA. 
A)  x to y. 
B)  y to x. 
C)  SA to SB. 
D)  SB to SA.

Question 9

A market's equilibrium is the point at which the supply and demand curves intersect.

Accepted Answer

A) True 
 B)False

Question 10

The following table contains a monthly demand schedule for large, single-topping, carry-out pizzas.   If the law of demand applies to these pizzas, then A could be

Accepted Answer

A)  0. 
B)  15. 
C)  25. 
D)  30. 
A)  0. 
B)  15. 
C)  25. 
D)  30.

Question 11

Figure 4-30  
-Refer to Figure 4-30. In this market for iPhones, the technology improves while all other factors remain constant. Explain the changes) in the equilibrium price and quantity.

Accepted Answer

Equilibrium price de

Question 12

An example of a perfectly competitive market would be the market for

Accepted Answer

A)  electricity. 
B)  soybeans. 
C)  coffee shops. 
D)  restaurants. 
A)  electricity. 
B)  soybeans. 
C)  coffee shops. 
D)  restaurants.

Question 13

Figure 4-8  
-Refer to Figure 4-8. Suppose the figure shows the market demand for Big Box e-readers. Suppose the price of the leading competitor's e­readers, a substitute good, decreases. 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 14

What would happen to the equilibrium price and quantity of lattés if the cost of producing steamed milk, which is used to make lattés, rises?

Accepted Answer

A)  Both the equilibrium price and quantity would increase. 
B)  Both the equilibrium price and quantity would decrease. 
C)  The equilibrium price would increase, and the equilibrium quantity would decrease. 
D)  The equilibrium price would decrease, and the equilibrium quantity would increase. 
A)  Both the equilibrium price and quantity would increase. 
B)  Both the equilibrium price and quantity would decrease. 
C)  The equilibrium price would increase, and the equilibrium quantity would decrease. 
D)  The equilibrium price would decrease, and the equilibrium quantity would increase.

Question 15

What would happen to the equilibrium price and quantity of lattés if consumers' incomes rise and lattés are a normal good?

Accepted Answer

A)  Both the equilibrium price and quantity would increase. 
B)  Both the equilibrium price and quantity would decrease. 
C)  The equilibrium price would increase, and the equilibrium quantity would decrease. 
D)  The equilibrium price would decrease, and the equilibrium quantity would increase. 
A)  Both the equilibrium price and quantity would increase. 
B)  Both the equilibrium price and quantity would decrease. 
C)  The equilibrium price would increase, and the equilibrium quantity would decrease. 
D)  The equilibrium price would decrease, and the equilibrium quantity would increase.

Question 16

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 17

Wheat is the main input in the production of flour. If the price of wheat decreases, then we would expect the

Accepted Answer

A)  demand for flour to increase. 
B)  demand for flour to decrease. 
C)  supply of flour to increase. 
D)  supply of flour to decrease. 
A)  demand for flour to increase. 
B)  demand for flour to decrease. 
C)  supply of flour to increase. 
D)  supply of flour to decrease.

Question 18

Suppose John and Wayne are the only two demanders of cowboy movies. Each month, John buys six cowboy movies when the price is $10 each, and he buys four cowboy movies when the price is $15 each. Each month, Wayne buys four cowboy movies when the price is $10 each, and he buys two cowboy movies when the price is $15 each. Which of the following points is on the market demand curve?

Accepted Answer

A)  quantity demanded = 2; price = $15 
B)  quantity demanded = 4; price = $25 
C)  quantity demanded = 10; price = $10 
D)  quantity demanded = 16; price = $25 
A)  quantity demanded = 2; price = $15 
B)  quantity demanded = 4; price = $25 
C)  quantity demanded = 10; price = $10 
D)  quantity demanded = 16; price = $25

Question 19

If the supply of a product decreases, then we would expect equilibrium price

Accepted Answer

A)  to increase and equilibrium quantity to decrease. 
B)  to decrease and equilibrium quantity to increase. 
C)  and equilibrium quantity to both increase. 
D)  and equilibrium quantity to both decrease. 
A)  to increase and equilibrium quantity to decrease. 
B)  to decrease and equilibrium quantity to increase. 
C)  and equilibrium quantity to both increase. 
D)  and equilibrium quantity to both decrease.

Question 20

Suppose you make jewelry. If the price of gold falls, then we would expect you to

Accepted Answer

A)  be willing and able to produce less jewelry than before at each possible price. 
B)  be willing and able to produce more jewelry than before at each possible price. 
C)  face a greater demand for your jewelry. 
D)  face a weaker demand for your jewelry. 
A)  be willing and able to produce less jewelry than before at each possible price. 
B)  be willing and able to produce more jewelry than before at each possible price. 
C)  face a greater demand for your jewelry. 
D)  face a weaker demand for your jewelry.

Exam 4: The Market Forces of Supply and Demand

Figure 4-7 -Refer to Figure 4-7. If the demand curve for Good X shifts from Da to Db, then

A market is a group of buyers and sellers of a particular good or service.

Which of the following is a determinant of the market supply curve but not a determinant of an individual seller's supply?

Table 4-6 -Refer to Table 4-6. If these are the only four sellers in the market, then the market quantity supplied at a price of $10 is

Suppose goods A and B are substitutes. If the price of good A increases, will the demand for good B increase or decrease?

Figure 4-27 Panel a) Panel b) Panel c) Panel d) -Refer to Figure 4-27. Which of the four panels illustrates an increase in quantity supplied?

Figure 4-11 -Refer to Figure 4-11. The movement from point A to point B on the graph is called

Figure 4-25 The graph below pertains to the supply of paper to colleges and universities. -Refer to Figure 4-25. All else equal, sellers expecting the price of paper to decrease next month when many college students leave campuses for the summer would cause a current move from

A market's equilibrium is the point at which the supply and demand curves intersect.

The following table contains a monthly demand schedule for large, single-topping, carry-out pizzas. If the law of demand applies to these pizzas, then A could be

Figure 4-30 -Refer to Figure 4-30. In this market for iPhones, the technology improves while all other factors remain constant. Explain the changes) in the equilibrium price and quantity.

An example of a perfectly competitive market would be the market for

Figure 4-8 -Refer to Figure 4-8. Suppose the figure shows the market demand for Big Box e-readers. Suppose the price of the leading competitor's e­readers, a substitute good, decreases. Which of the following changes would occur?

What would happen to the equilibrium price and quantity of lattés if the cost of producing steamed milk, which is used to make lattés, rises?

What would happen to the equilibrium price and quantity of lattés if consumers' incomes rise and lattés are a normal good?

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)

Wheat is the main input in the production of flour. If the price of wheat decreases, then we would expect the

If the supply of a product decreases, then we would expect equilibrium price

Suppose you make jewelry. If the price of gold falls, then we would expect you to

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Application: The Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Costs of Production

Firms in Competitive Markets

Monopoly

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

The Basic Tools of Finance

Unemployment

The Monetary System

Money Growth and Inflation

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

Filters

Figure 4-8 -Refer to Figure 4-8. Suppose the figure shows the market demand for Big Box e-readers. Suppose the price of the leading competitor's ereaders, a substitute good, decreases. Which of the following changes would occur?