Question 1

A market supply curve is determined by

Accepted Answer

A)  vertically summing individual supply curves. 
B)  horizontally summing individual supply curves. 
C)  finding the average quantity supplied by sellers at each possible price. 
D)  finding the average price at which sellers are willing and able to sell a particular quantity of the good.

Question 2

Most studies have found that tobacco and marijuana are substitutes rather than complements.

Accepted Answer

A) True 
 B)False

Question 3

If a shortage exists in a market, then we know that the actual price is

Accepted Answer

A)  above the equilibrium price, and quantity supplied is greater than quantity demanded. 
B)  above the equilibrium price, and quantity demanded is greater than quantity supplied. 
C)  below the equilibrium price, and quantity demanded is greater than quantity supplied. 
D)  below the equilibrium price, and quantity supplied is greater than quantity demanded.

Question 4

An increase in the price of a product and an increase in the number of sellers in the market affect the supply curve in the same general way.

Accepted Answer

A) True 
 B)False

Question 5

You wear either shorts or sweatpants every day. You notice that sweatpants have gone on sale, so your demand for

Accepted Answer

A)  sweatpants will increase. 
B)  sweatpants will decrease. 
C)  shorts will increase. 
D)  shorts will decrease.

Question 6

Table 4-9
 
-Refer to Table 4-9. Which combination would produce an increase in equilibrium quantity and an indeterminate change in equilibrium price?

Accepted Answer

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

Question 7

Price will rise to eliminate a shortage.

Accepted Answer

A) True 
 B)False

Question 8

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

Accepted Answer

A)  a decrease in price. 
B)  a decrease in income, assuming the good is inferior. 
C)  buyers expecting the price of the good to fall in the near future. 
D)  an increase in the price of a complement.

Question 9

If buyers today become more willing and able than before to purchase larger quantities of stand up paddle boards SUPs) at each price of SUPs, then

Accepted Answer

A)  we will observe a movement downward and to the right along the demand curve for SUPs. 
B)  we will observe a movement upward and to the left along the demand curve for SUPs. 
C)  the demand curve for SUPs will shift to the right. 
D)  the demand curve for SUPs will shift to the left.

Question 10

If something happens to alter the quantity demanded at any given price, then

Accepted Answer

A)  the demand curve becomes steeper. 
B)  the demand curve becomes flatter. 
C)  the demand curve shifts. 
D)  we move along the demand curve.

Question 11

The law of demand states that, other things equal, when the price of a good

Accepted Answer

A)  falls, the demand for the good rises. 
B)  rises, the quantity demanded of the good rises. 
C)  rises, the demand for the good falls. 
D)  falls, the quantity demanded of the good rises.

Question 12

What will happen to the equilibrium price and quantity of traditional camera film if traditional cameras become more expensive, digital cameras become cheaper, the cost of the resources needed to manufacture traditional film falls, and more firms decide to manufacture traditional film?

Accepted Answer

A)  Price will fall, and the effect on quantity is ambiguous. 
B)  Price will rise, and the effect on quantity is ambiguous. 
C)  Quantity will fall, and the effect on price is ambiguous. 
D)  Quantity will rise, and the effect on price is ambiguous.

Question 13

When quantity demanded exceeds quantity supplied at the current market price, the market has a shortage, and market price will likely rise in the future to eliminate the shortage.

Accepted Answer

A) True 
 B)False

Question 14

When an increase in the price of one good lowers the demand for another good, the two goods are called complements.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following changes would not shift the demand curve for a good or service?

Accepted Answer

A)  a change in income 
B)  a change in the price of the good or service 
C)  a change in expectations about the future price of the good or service 
D)  a change in the price of a related good or service

Question 16

Table 4-15
The following table shows the number of cases of water each seller is willing to sell at the prices listed.
 
-Refer to Table 4-15. If all four suppliers operate in this market, what is the market quantity supplied when the price is $6.00 per case?

Accepted Answer

The answer of Table 4-15
The following table shows the number...

Question 17

Public service announcements, mandatory health warnings on cigarette packages, and the prohibition of cigarette advertising on television are all policies aimed at shifting the demand curve for cigarettes to the right.

Accepted Answer

A) True 
 B)False

Question 18

Figure 4-16 
-Refer to Figure 4-16. The shift from S to S' is called an)

Accepted Answer

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

Question 19

Figure 4-26 
-Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for wedding cakes resulting from a decrease in the number of pastry chefs?

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

Question 20

Table 4-7
 
-Refer to Table 4-7. If these are the only four sellers in the market for ice cream, then the market quantity supplied at a price of $8 is

Accepted Answer

A)  10 gallons. 
B)  20 gallons. 
C)  32 gallons. 
D)  40 gallons.

Exam 4: The Market Forces of Supply and Demand

A market supply curve is determined by

Most studies have found that tobacco and marijuana are substitutes rather than complements.

If a shortage exists in a market, then we know that the actual price is

An increase in the price of a product and an increase in the number of sellers in the market affect the supply curve in the same general way.

You wear either shorts or sweatpants every day. You notice that sweatpants have gone on sale, so your demand for

Table 4-9 -Refer to Table 4-9. Which combination would produce an increase in equilibrium quantity and an indeterminate change in equilibrium price?

Price will rise to eliminate a shortage.

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

If buyers today become more willing and able than before to purchase larger quantities of stand up paddle boards SUPs) at each price of SUPs, then

If something happens to alter the quantity demanded at any given price, then

The law of demand states that, other things equal, when the price of a good

What will happen to the equilibrium price and quantity of traditional camera film if traditional cameras become more expensive, digital cameras become cheaper, the cost of the resources needed to manufacture traditional film falls, and more firms decide to manufacture traditional film?

When quantity demanded exceeds quantity supplied at the current market price, the market has a shortage, and market price will likely rise in the future to eliminate the shortage.

When an increase in the price of one good lowers the demand for another good, the two goods are called complements.

Which of the following changes would not shift the demand curve for a good or service?

Table 4-15 The following table shows the number of cases of water each seller is willing to sell at the prices listed. -Refer to Table 4-15. If all four suppliers operate in this market, what is the market quantity supplied when the price is $6.00 per case?

Public service announcements, mandatory health warnings on cigarette packages, and the prohibition of cigarette advertising on television are all policies aimed at shifting the demand curve for cigarettes to the right.

Figure 4-16 -Refer to Figure 4-16. The shift from S to S' is called an)

Figure 4-26 -Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for wedding cakes resulting from a decrease in the number of pastry chefs?

Table 4-7 -Refer to Table 4-7. If these are the only four sellers in the market for ice cream, then the market quantity supplied at a price of $8 is