Question 1

Figure 4-18  
-Refer to Figure 4-18. At a price of $15, there would be a

Accepted Answer

A)  surplus of 400 units. 
B)  shortage of 200 units. 
C)  shortage of 400 units. 
D)  shortage of 600 units. 
A)  surplus of 400 units. 
B)  shortage of 200 units. 
C)  shortage of 400 units. 
D)  shortage of 600 units.

Question 2

Soup is an inferior good if the demand

Accepted Answer

A)  for soup falls when the price of a substitute for soup rises. 
B)  for soup rises when the price of soup falls. 
C)  curve for soup slopes upward. 
D)  for soup falls when income rises. 
A)  for soup falls when the price of a substitute for soup rises. 
B)  for soup rises when the price of soup falls. 
C)  curve for soup slopes upward. 
D)  for soup falls when income rises.

Question 3

Table 4-13
The demand schedule below pertains to sandwiches demanded per week.
  
-Refer to Table 4-13. Regarding Harry and Darby, for whom are sandwiches a normal good?

Accepted Answer

A)  only for Harry 
B)  only for Darby 
C)  for both Harry and Darby 
D)  This cannot be determined from the given information. 
A)  only for Harry 
B)  only for Darby 
C)  for both Harry and Darby 
D)  This cannot be determined from the given information.

Question 4

The law of demand states that, other things equal, an increase in

Accepted Answer

A)  price causes quantity demanded to increase. 
B)  price causes quantity demanded to decrease. 
C)  quantity demanded causes price to increase. 
D)  quantity demanded causes price to decrease. 
A)  price causes quantity demanded to increase. 
B)  price causes quantity demanded to decrease. 
C)  quantity demanded causes price to increase. 
D)  quantity demanded causes price to decrease.

Question 5

Table 4-4
  
-Refer to Table 4-4. Suppose the market consists of Adam, Barb, and Carl. If the price falls by $2, the quantity demanded in the market increases by

Accepted Answer

A)  4 units. 
B)  6 units. 
C)  8 units. 
D)  10 units. 
A)  4 units. 
B)  6 units. 
C)  8 units. 
D)  10 units.

Question 6

An increase in quantity demanded

Accepted Answer

A)  results in a movement downward and to the right along a demand curve. 
B)  results in a movement upward and to the left along a demand curve. 
C)  shifts the demand curve to the left. 
D)  shifts the demand curve to the right. 
A)  results in a movement downward and to the right along a demand curve. 
B)  results in a movement upward and to the left along a demand curve. 
C)  shifts the demand curve to the left. 
D)  shifts the demand curve to the right.

Question 7

An increase in demand is represented by a

Accepted Answer

A)  movement downward and to the right along a demand curve. 
B)  movement upward and to the left along a demand curve. 
C)  rightward shift of a demand curve. 
D)  leftward shift of a demand curve. 
A)  movement downward and to the right along a demand curve. 
B)  movement upward and to the left along a demand curve. 
C)  rightward shift of a demand curve. 
D)  leftward shift of a demand curve.

Question 8

Table 4-12
A country club usually only allows members to purchase tickets for its celebrity golf tournament, but the club is considering allowing non-members to purchase tickets this year. The demand and supply schedules are as follows:
  
-Refer to Table 4-12. If both members and non-members are allowed to purchase tickets to this year's celebrity golf tournament, then what will be the equilibrium price?

Accepted Answer

A)  $10 
B)  $15 
C)  $20 
D)  $25 
A)  $10 
B)  $15 
C)  $20 
D)  $25

Question 9

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

Accepted Answer

A)  a decrease in the price of the good. 
B)  an increase in the price of the good. 
C)  an advance in production technology. 
D)  a decrease in input prices. 
A)  a decrease in the price of the good. 
B)  an increase in the price of the good. 
C)  an advance in production technology. 
D)  a decrease in input prices.

Question 10

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

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 11

Table 4-10
The following table shows the number of cases of water each seller is willing to sell at the prices listed.
  
-Refer to Table 4-10. If the four suppliers listed are the only suppliers in this market and the market quantity demanded is 500 cases when the price is $5.00, which of the following statements is correct?

Accepted Answer

A)  The market is in equilibrium at a price of $5.00. 
B)  There is a surplus of 100 cases at a price of $5.00. 
C)  There is a shortage of 100 cases at a price of $5.00. 
D)  There is a shortage of 50 cases at a price of $5.00. 
A)  The market is in equilibrium at a price of $5.00. 
B)  There is a surplus of 100 cases at a price of $5.00. 
C)  There is a shortage of 100 cases at a price of $5.00. 
D)  There is a shortage of 50 cases at a price of $5.00.

Question 12

Figure 4-26  
-Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for paper napkins as a result of a "Go Green" advertising campaign encouraging people to use cloth napkins?

Accepted Answer

A)  Point A to Point B 
B)  Point C to Point B 
C)  Point C to Point D 
D)  Point A to Point D 
A)  Point A to Point B 
B)  Point C to Point B 
C)  Point C to Point D 
D)  Point A to Point D

Question 13

Figure 4-4
Yasmine Mercedes
    
-Refer to Figure 4-4. Which of the following statements is correct?

Accepted Answer

A)  If the price is $6, the market quantity demanded is 15 units. 
B)  If the price is $9, the market quantity demanded is 24 units. 
C)  If the price is $12, the market quantity demanded is 9 units. 
D)  If the price is $15, the market quantity demanded is 39 units. 
A)  If the price is $6, the market quantity demanded is 15 units. 
B)  If the price is $9, the market quantity demanded is 24 units. 
C)  If the price is $12, the market quantity demanded is 9 units. 
D)  If the price is $15, the market quantity demanded is 39 units.

Question 14

In a market, to find the total amount supplied at a particular price, we must

Accepted Answer

A)  sum the quantities that individual firms are willing and able to supply at that price. 
B)  calculate the average of the quantities that individual firms are willing and able to supply at that price. 
C)  sum the costs that individual firms incur to supply the product at that price. 
D)  account for all determinants of demand. 
A)  sum the quantities that individual firms are willing and able to supply at that price. 
B)  calculate the average of the quantities that individual firms are willing and able to supply at that price. 
C)  sum the costs that individual firms incur to supply the product at that price. 
D)  account for all determinants of demand.

Question 15

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

Accepted Answer

A)  shortage to exist and the market price of chocolate-dipped strawberries to increase. 
B)  shortage to exist and the market price of chocolate-dipped strawberries to decrease. 
C)  surplus to exist and the market price of chocolate-dipped strawberries to increase. 
D)  surplus to exist and the market price of chocolate-dipped strawberries to decrease. 
A)  shortage to exist and the market price of chocolate-dipped strawberries to increase. 
B)  shortage to exist and the market price of chocolate-dipped strawberries to decrease. 
C)  surplus to exist and the market price of chocolate-dipped strawberries to increase. 
D)  surplus to exist and the market price of chocolate-dipped strawberries to decrease.

Question 16

At the equilibrium price, the quantity of the good that buyers are willing and able to buy

Accepted Answer

A)  is greater than the quantity that sellers are willing and able to sell. 
B)  exactly equals the quantity that sellers are willing and able to sell. 
C)  is less than the quantity that sellers are willing and able to sell. 
D)  Either a) or c) could be correct. 
A)  is greater than the quantity that sellers are willing and able to sell. 
B)  exactly equals the quantity that sellers are willing and able to sell. 
C)  is less than the quantity that sellers are willing and able to sell. 
D)  Either a) or c) could be correct.

Question 17

Figure 4-26  
-Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for golf balls of an increase in green fees?

Accepted Answer

A)  Point A to Point B 
B)  Point C to Point B 
C)  Point C to Point D 
D)  Point A to Point D 
A)  Point A to Point B 
B)  Point C to Point B 
C)  Point C to Point D 
D)  Point A to Point D

Question 18

A likely example of complementary goods for most people would be

Accepted Answer

A)  canoes and paddles. 
B)  snow mobiles and sofas. 
C)  coffee and tea. 
D)  tennis balls and basketballs. 
A)  canoes and paddles. 
B)  snow mobiles and sofas. 
C)  coffee and tea. 
D)  tennis balls and basketballs.

Question 19

What would happen to the equilibrium price and quantity of lattés if coffee shops began using a machine that reduced the amount of labor necessary to produce them?

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 20

A higher price for batteries would result in a(n)

Accepted Answer

A)  increase in the demand for flashlights. 
B)  decrease in the demand for flashlights. 
C)  increase in the demand for batteries. 
D)  decrease in the demand for batteries. 
A)  increase in the demand for flashlights. 
B)  decrease in the demand for flashlights. 
C)  increase in the demand for batteries. 
D)  decrease in the demand for batteries.

Exam 4: The Market Forces of Supply and Demand

Figure 4-18 -Refer to Figure 4-18. At a price of $15, there would be a

Soup is an inferior good if the demand

Table 4-13 The demand schedule below pertains to sandwiches demanded per week. -Refer to Table 4-13. Regarding Harry and Darby, for whom are sandwiches a normal good?

The law of demand states that, other things equal, an increase in

Table 4-4 -Refer to Table 4-4. Suppose the market consists of Adam, Barb, and Carl. If the price falls by $2, the quantity demanded in the market increases by

An increase in quantity demanded

An increase in demand is represented by a

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

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

Figure 4-26 -Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for paper napkins as a result of a "Go Green" advertising campaign encouraging people to use cloth napkins?

Figure 4-4 Yasmine Mercedes -Refer to Figure 4-4. Which of the following statements is correct?

In a market, to find the total amount supplied at a particular price, we must

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

At the equilibrium price, the quantity of the good that buyers are willing and able to buy

Figure 4-26 -Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for golf balls of an increase in green fees?

A likely example of complementary goods for most people would be

What would happen to the equilibrium price and quantity of lattés if coffee shops began using a machine that reduced the amount of labor necessary to produce them?

A higher price for batteries would result in a(n)

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

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