Question 1

If the automobile workers' union successfully negotiates a wage increase for its members,how does the wage hike affect the supply of automobiles?

Accepted Answer

A)  The supply increases. 
B)  The supply decreases. 
C)  The quantity supplied increases. 
D)  The quantity supplied decreases. 
E)  Both answers B and D are correct. 
A)  The supply increases. 
B)  The supply decreases. 
C)  The quantity supplied increases. 
D)  The quantity supplied decreases. 
E)  Both answers B and D are correct.

Question 2

Millions of people from Mexico have migrated to the United States.This has reduced the supply of labor in Mexico and increased the supply of labor in the United States.Assume that the demand for labor in Mexico and the United States is unchanged.Then wages in the United States ________ and wages in Mexico ________.

Accepted Answer

A)  fall; rise 
B)  rise; rise 
C)  rise; do not change 
D)  fall; fall 
E)  do not change; fall 
A)  fall; rise 
B)  rise; rise 
C)  rise; do not change 
D)  fall; fall 
E)  do not change; fall

Question 3

Suppose that the price of bread rises.This rise could be the result of

Accepted Answer

A)  a decrease in the supply of bread. 
B)  an increase in the supply of bread. 
C)  a decrease in the demand for bread. 
D)  Both answers A and C are correct. 
E)  Both answers B and C are correct. 
A)  a decrease in the supply of bread. 
B)  an increase in the supply of bread. 
C)  a decrease in the demand for bread. 
D)  Both answers A and C are correct. 
E)  Both answers B and C are correct.

Question 4

Why does an increase in supply lead to lower prices?

Accepted Answer

When the supply of a good,such as comput

Question 5

-The above figure illustrates the market for corn.If point "a" represents the original equilibrium and point "b" the new equilibrium,which of the following could have caused the change?

Accepted Answer

A)  an increase in the number of corn growers 
B)  an increase the price of wheat, a substitute in production for corn 
C)  an increase in the cost of the fertilizer used to grow the corn 
D)  a belief among corn farmers that the price of a bushel of corn will be higher next month 
E)  an increase in income if corn is a normal good 
A)  an increase in the number of corn growers 
B)  an increase the price of wheat, a substitute in production for corn 
C)  an increase in the cost of the fertilizer used to grow the corn 
D)  a belief among corn farmers that the price of a bushel of corn will be higher next month 
E)  an increase in income if corn is a normal good

Question 6

-The table above indicates how many thousands of containers of ice cream three different companies are willing to produce at different prices.Does this information reflect the law of supply? Why or why not?

Accepted Answer

Yes,the information in the tab

Question 7

To find the market demand curve for in-line skates,we must

Accepted Answer

A)  add the quantities demanded at every price and every income by every buyer of in-line skates. 
B)  add the quantities demanded at prices that all buyers can afford to pay. 
C)  sum horizontally the individual demand curves of all the buyers. 
D)  take account of the skate buying plans of all actual and potential buyers in all possible situations. 
E)  None of the above answers is correct because we need also to take account of the supply of in-line skates. 
A)  add the quantities demanded at every price and every income by every buyer of in-line skates. 
B)  add the quantities demanded at prices that all buyers can afford to pay. 
C)  sum horizontally the individual demand curves of all the buyers. 
D)  take account of the skate buying plans of all actual and potential buyers in all possible situations. 
E)  None of the above answers is correct because we need also to take account of the supply of in-line skates.

Question 8

Market equilibrium
i.can never occur because there are always people who want a good but cannot afford it.
ii.occurs at the intersection of the supply and demand curves.
iii.is the point where the price equals the quantity.

Accepted Answer

A)  ii only 
B)  iii only 
C)  ii and iii 
D)  i only 
E)  i and ii 
A)  ii only 
B)  iii only 
C)  ii and iii 
D)  i only 
E)  i and ii

Question 9

An increase in the equilibrium price and a decrease in the equilibrium quantity can be the result of

Accepted Answer

A)  a decrease in demand. 
B)  an increase in supply. 
C)  a decrease in supply. 
D)  an increase in demand. 
E)  None of the above. 
A)  a decrease in demand. 
B)  an increase in supply. 
C)  a decrease in supply. 
D)  an increase in demand. 
E)  None of the above.

Question 10

When a surplus of rice occurs,

Accepted Answer

A)  the price of rice rises. 
B)  the price of rice falls. 
C)  there is a balance between the forces of supply and demand. 
D)  the quantity demanded is greater than quantity supplied at the current price. 
E)  the demand curve shifts rightward and the supply curve shifts leftward to eliminate the surplus. 
A)  the price of rice rises. 
B)  the price of rice falls. 
C)  there is a balance between the forces of supply and demand. 
D)  the quantity demanded is greater than quantity supplied at the current price. 
E)  the demand curve shifts rightward and the supply curve shifts leftward to eliminate the surplus.

Question 11

Which of the following helps explain why the law of supply exists?

Accepted Answer

A)  Larger outputs result in lower costs of production. 
B)  The law of increasing opportunity cost 
C)  The costs of production remain constant throughout all levels of output. 
D)  Sellers realize that if the price increases, they make larger profits and do not need to change their production. 
E)  The law of demand 
A)  Larger outputs result in lower costs of production. 
B)  The law of increasing opportunity cost 
C)  The costs of production remain constant throughout all levels of output. 
D)  Sellers realize that if the price increases, they make larger profits and do not need to change their production. 
E)  The law of demand

Question 12

A competitive market is in equilibrium.Then there is an increase in demand and an increase in supply.The equilibrium price ________,and the equilibrium quantity ________.

Accepted Answer

A)  rises; increases 
B)  perhaps changes but we can't say if it rises, falls, or stays the same; does not change 
C)  falls; increases 
D)  perhaps changes but we can't say if it rises, falls, or stays the same; increases 
E)  falls; perhaps changes but we can't say if it increases, decreases, or stays the same 
A)  rises; increases 
B)  perhaps changes but we can't say if it rises, falls, or stays the same; does not change 
C)  falls; increases 
D)  perhaps changes but we can't say if it rises, falls, or stays the same; increases 
E)  falls; perhaps changes but we can't say if it increases, decreases, or stays the same

Question 13

People consume more soup as temperatures falls.So,as cold weather approaches,

Accepted Answer

A)  the quantity of soup demanded increases. 
B)  the demand for soup increases. 
C)  people move closer to their demand curve for soup. 
D)  people move farther beyond their demand curves. 
E)  both the demand and the quantity demanded of soup increase. 
A)  the quantity of soup demanded increases. 
B)  the demand for soup increases. 
C)  people move closer to their demand curve for soup. 
D)  people move farther beyond their demand curves. 
E)  both the demand and the quantity demanded of soup increase.

Question 14

An increase in both the equilibrium price and quantity can be the result of

Accepted Answer

A)  a decrease in demand. 
B)  an increase in supply. 
C)  a decrease in supply. 
D)  an increase in demand. 
E)  None of the above answers is correct. 
A)  a decrease in demand. 
B)  an increase in supply. 
C)  a decrease in supply. 
D)  an increase in demand. 
E)  None of the above answers is correct.

If the automobile workers' union successfully negotiates a wage increase for its members,how does the wage hike affect the supply of automobiles?

Millions of people from Mexico have migrated to the United States.This has reduced the supply of labor in Mexico and increased the supply of labor in the United States.Assume that the demand for labor in Mexico and the United States is unchanged.Then wages in the United States and wages in Mexico .

Suppose that the price of bread rises.This rise could be the result of

Why does an increase in supply lead to lower prices?

-The above figure illustrates the market for corn.If point "a" represents the original equilibrium and point "b" the new equilibrium,which of the following could have caused the change?

-The table above indicates how many thousands of containers of ice cream three different companies are willing to produce at different prices.Does this information reflect the law of supply? Why or why not?

To find the market demand curve for in-line skates,we must

Market equilibrium i.can never occur because there are always people who want a good but cannot afford it. ii.occurs at the intersection of the supply and demand curves. iii.is the point where the price equals the quantity.

An increase in the equilibrium price and a decrease in the equilibrium quantity can be the result of

When a surplus of rice occurs,

Which of the following helps explain why the law of supply exists?

A competitive market is in equilibrium.Then there is an increase in demand and an increase in supply.The equilibrium price ,and the equilibrium quantity .

People consume more soup as temperatures falls.So,as cold weather approaches,

An increase in both the equilibrium price and quantity can be the result of

Getting Started

The U.S.and Global Economies

The Economic Problem

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets with Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

Exam 4: Demand and Supply

If the automobile workers' union successfully negotiates a wage increase for its members,how does the wage hike affect the supply of automobiles?

Suppose that the price of bread rises.This rise could be the result of

Why does an increase in supply lead to lower prices?

-The above figure illustrates the market for corn.If point "a" represents the original equilibrium and point "b" the new equilibrium,which of the following could have caused the change?

-The table above indicates how many thousands of containers of ice cream three different companies are willing to produce at different prices.Does this information reflect the law of supply? Why or why not?

To find the market demand curve for in-line skates,we must

Market equilibrium i.can never occur because there are always people who want a good but cannot afford it. ii.occurs at the intersection of the supply and demand curves. iii.is the point where the price equals the quantity.

An increase in the equilibrium price and a decrease in the equilibrium quantity can be the result of

When a surplus of rice occurs,

Which of the following helps explain why the law of supply exists?

A competitive market is in equilibrium.Then there is an increase in demand and an increase in supply.The equilibrium price ________,and the equilibrium quantity ________.

People consume more soup as temperatures falls.So,as cold weather approaches,

An increase in both the equilibrium price and quantity can be the result of

Getting Started

The U.S.and Global Economies

The Economic Problem

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets with Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

A competitive market is in equilibrium.Then there is an increase in demand and an increase in supply.The equilibrium price ,and the equilibrium quantity .