Question 1

-Which figure above shows the effect of an increase in the cost of the tomato sauce used to produce pizza?

Accepted Answer

A) Figure A 
B) Figure B 
C) Figure C 
D) Figure D 
E) Both Figure B and Figure C

Question 2

-Which figure above shows the effect of a technological advance in the production of pizza?

Accepted Answer

A) Figure A 
B) Figure B 
C) Figure C 
D) Figure D 
E) Both Figure A and Figure D

Question 3

If the number of companies producing memory chips increases, then the

Accepted Answer

A) supply of memory chips does not change. 
B) supply of memory chips increases. 
C) supply of memory chips decreases. 
D) quantity of memory chips supplied increases. 
E) demand for memory chips increases.

Question 4

If the demand for used cars decreases after the price of a new car falls, used cars and new cars are

Accepted Answer

A) inferior goods. 
B) substitute goods. 
C) complementary goods. 
D) normal goods. 
E) The questions errs because it is the quantity of used cars, NOT the demand for used cars, that will change when the price of a new car falls.

Question 5

-The above figure shows the market for laptops. Which of the following shifts the supply curve from S₀ to S₁?

Accepted Answer

A) an increase in the cost of hard drives 
B) a decrease in the price of laptops 
C) an increase in the number of laptop manufactures and sellers 
D) an increase in the price of laptops 
E) an increase in the productivity of the workers manufacturing laptops

Question 6

-The above figure shows the market for pizza. The market is in equilibrium when the wages paid pizza workers increases. What point represents the most likely new price and quantity?

Accepted Answer

A) A 
B) B 
C) C 
D) D 
E) E

Question 7

Fresh orange juice and frozen orange juice are substitutes in production. The price of fresh orange juice rises. As a result, the equilibrium price of frozen orange juice ________ and the equilibrium quantity ________.

Accepted Answer

A) rises; increases 
B) rises; decreases 
C) falls; increases 
D) falls; decreases 
E) does not change; decreases

Question 8

-The above figure shows the market for pizza. The market is in equilibrium when people learn that eating pizza helps prevent heart disease. What point represents the most likely new price and quantity?

Accepted Answer

A) A 
B) B 
C) C 
D) D 
E) E

Question 9

Gasoline prices increase by 50 percent and other things remain the same. As a result, there is

Accepted Answer

A) an increase in the demand for gasoline. 
B) a decrease in the demand for gasoline. 
C) no change in the quantity of gasoline demanded. 
D) a decrease in the quantity of gasoline demanded. 
E) More information is needed to determine if the demand for gasoline increases or decreases.

Question 10

Consider the market for cellular phones. Which of the following shifts the demand curve leftward?

Accepted Answer

A) studies showing using cellular phones can cause brain cancer 
B) a decrease in the price of cellular phones 
C) a decrease in the quantity demanded of cellular phones 
D) an increase in the services provided by cellular phones, such as text messaging 
E) an increase in the price of cellular phones

Question 11

-The above figures show the market for HD televisions. If the technology used to produce these televisions advances so that productivity increases, which figure shows the effect of this change?

Accepted Answer

A) Figure A 
B) Figure B 
C) Figure C 
D) Figure D 
E) None of the figures represent this change.

Question 12

Candy makers accurately anticipate the increase in demand for candy for Halloween so that the supply of candy and demand for candy increase the same amount. As a result, the price of candy ________ and the quantity of candy ________.

Accepted Answer

A) rises; does not change 
B) falls; increases 
C) does not change; increases 
D) does not change; does not change 
E) rises; increases

Question 13

Computers are a complement to computer software. Suppose the price of a computer falls. How does this fall in price affect the demand for computer software and the demand curve for computer software?

Accepted Answer

The answer of Computers are a complement to computer software....

Question 14

-The above figure shows the market for pizza. The market is in equilibrium when people's incomes decrease. If pizza is a normal good, then which point represents the most likely new price and quantity?

Accepted Answer

A) A 
B) B 
C) C 
D) D 
E) E

Question 15

If the demand for a good increases when people's incomes increase,

Accepted Answer

A) the good is an inferior good. 
B) the law of demand is violated. 
C) the good's demand curve must be slope upward. 
D) the good is a normal good. 
E) the good is a substitute good for an inferior good.

Question 16

Which of the following results in an increase in the supply of a good or service?

Accepted Answer

A) a fall in the price of the good or service 
B) a smaller number of sellers producing the good or service 
C) an increase in foreign imports of the good or service 
D) higher taxes imposed upon producers of the good or service 
E) a rise in the price of the good or service

Question 17

Which of the following lower the equilibrium price of a canoe?

Accepted Answer

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

Question 18

A huge 50 percent off sale on golf clubs is advertised for next week. What happens this week in the market for golf clubs?

Accepted Answer

A) The supply of golf clubs increases. 
B) The supply of golf clubs decreases. 
C) The demand for golf clubs increases. 
D) The demand for golf clubs decreases. 
E) The demand for and the supply of golf clubs decreases.

Question 19

Consider the market for smart phones. Which of the following shifts the demand curve rightward?

Accepted Answer

A) an increase in the price of smart phones 
B) a decrease in the price of smart phones 
C) an increase in the price of land-line phone service, a substitute for smart phones 
D) a decrease in the number of smart phone buyers 
E) an increase in the supply of smart phones.

Question 20

What is the law of demand?

Accepted Answer

The answer of What is the law of demand?...

Exam 4: Demand and Supply

-Which figure above shows the effect of an increase in the cost of the tomato sauce used to produce pizza?

-Which figure above shows the effect of a technological advance in the production of pizza?

If the number of companies producing memory chips increases, then the

If the demand for used cars decreases after the price of a new car falls, used cars and new cars are

-The above figure shows the market for laptops. Which of the following shifts the supply curve from S₀ to S₁?

-The above figure shows the market for pizza. The market is in equilibrium when the wages paid pizza workers increases. What point represents the most likely new price and quantity?

Fresh orange juice and frozen orange juice are substitutes in production. The price of fresh orange juice rises. As a result, the equilibrium price of frozen orange juice and the equilibrium quantity .

-The above figure shows the market for pizza. The market is in equilibrium when people learn that eating pizza helps prevent heart disease. What point represents the most likely new price and quantity?

Gasoline prices increase by 50 percent and other things remain the same. As a result, there is

Consider the market for cellular phones. Which of the following shifts the demand curve leftward?

-The above figures show the market for HD televisions. If the technology used to produce these televisions advances so that productivity increases, which figure shows the effect of this change?

Candy makers accurately anticipate the increase in demand for candy for Halloween so that the supply of candy and demand for candy increase the same amount. As a result, the price of candy and the quantity of candy .

Computers are a complement to computer software. Suppose the price of a computer falls. How does this fall in price affect the demand for computer software and the demand curve for computer software?

-The above figure shows the market for pizza. The market is in equilibrium when people's incomes decrease. If pizza is a normal good, then which point represents the most likely new price and quantity?

If the demand for a good increases when people's incomes increase,

Which of the following results in an increase in the supply of a good or service?

Which of the following lower the equilibrium price of a canoe?

A huge 50 percent off sale on golf clubs is advertised for next week. What happens this week in the market for golf clubs?

Consider the market for smart phones. Which of the following shifts the demand curve rightward?

What is the law of demand?