Question 1

-In the figure above, which movement reflects a decrease in quantity demanded but NOT a decrease in demand?

Accepted Answer

A)  from point a to point c 
B)  from point a to point d 
C)  from point a to point e 
D)  from point a to point b 
A)  from point a to point c 
B)  from point a to point d 
C)  from point a to point e 
D)  from point a to point b

Question 2

The price of a good will fall if

Accepted Answer

A)  the price of a complement in consumption falls. 
B)  there is a surplus at the current price. 
C)  the quantity demanded exceeds the quantity supplied. 
D)  the current price is less than the equilibrium price. 
A)  the price of a complement in consumption falls. 
B)  there is a surplus at the current price. 
C)  the quantity demanded exceeds the quantity supplied. 
D)  the current price is less than the equilibrium price.

Question 3

Which of the following shifts the demand curve for hot dogs leftward?

Accepted Answer

A)  an increase in the price of a hot dog 
B)  an increase in the price of a hot dog bun 
C)  a decrease in the price of a hot dog bun 
D)  an increase in the price of a hamburger 
A)  an increase in the price of a hot dog 
B)  an increase in the price of a hot dog bun 
C)  a decrease in the price of a hot dog bun 
D)  an increase in the price of a hamburger

Question 4

-The above figure represents the market for bicycles. When there is a physical fitness craze the

Accepted Answer

A)  demand curve for bicycles shifts from D1 to D2. 
B)  demand curve and the supply curve of bicycles do not shift. 
C)  demand curve for bicycles shifts from D2 to D1. 
D)  supply curve of bicycles shifts from S1 to S2. 
A)  demand curve for bicycles shifts from D1 to D2. 
B)  demand curve and the supply curve of bicycles do not shift. 
C)  demand curve for bicycles shifts from D2 to D1. 
D)  supply curve of bicycles shifts from S1 to S2.

Question 5

If the demand for and supply of bathing suits both decrease, then definitely the equilibrium

Accepted Answer

A)  quantity will increase. 
B)  quantity will decrease. 
C)  price will decrease. 
D)  price will increase. 
A)  quantity will increase. 
B)  quantity will decrease. 
C)  price will decrease. 
D)  price will increase.

Question 6

The price of cereal rises. As a result, people have cereal for breakfast on fewer days and eat eggs instead. This behavior is an example of

Accepted Answer

A)  a decrease in the quantity supplied of cereal because of the substitution effect. 
B)  an increase in the quantity demanded of eggs because of the income effect. 
C)  an increase in the quantity supplied of eggs because of the income effect. 
D)  a decrease in the quantity demanded of cereal because of the substitution effect. 
A)  a decrease in the quantity supplied of cereal because of the substitution effect. 
B)  an increase in the quantity demanded of eggs because of the income effect. 
C)  an increase in the quantity supplied of eggs because of the income effect. 
D)  a decrease in the quantity demanded of cereal because of the substitution effect.

Question 7

-The above figure represents the market for french fries at fast food joints. If the price of potatoes rises and simultaneously people become concerned that french fries can cause heart attacks the

Accepted Answer

A)  demand curve for french fries shifts from D2 to D1 and the supply curve of french fries shifts from S1 to S2. 
B)  demand curve for french fries shifts from D2 to D1 and the supply curve of french fries does not shift. 
C)  demand curve for french fries does not shift, and the supply curve of french fries shifts from S1 to S2. 
D)  demand curve for french fries shifts from D2 to D1 and the supply curve of french fries shifts from S2 to S1. 
A)  demand curve for french fries shifts from D2 to D1 and the supply curve of french fries shifts from S1 to S2. 
B)  demand curve for french fries shifts from D2 to D1 and the supply curve of french fries does not shift. 
C)  demand curve for french fries does not shift, and the supply curve of french fries shifts from S1 to S2. 
D)  demand curve for french fries shifts from D2 to D1 and the supply curve of french fries shifts from S2 to S1.

Question 8

-The above figures show the market for gasoline. Which figure(s) shows the effect of a new U.S. tax on oil that suppliers must pay?

Accepted Answer

A)  Figures A and C 
B)  Figures B and D 
C)  Figure A only 
D)  Figure C only 
A)  Figures A and C 
B)  Figures B and D 
C)  Figure A only 
D)  Figure C only

Question 9

There is a technological advance in the production of a good and simultaneously also an increase in the expected future price. Which of the following will happen?

Accepted Answer

A)  The equilibrium price will rise because the supply curve shifts rightward. 
B)  The equilibrium price falls because the supply curve shifts leftward. 
C)  The demand curve shifts rightward and the supply curve does not shift. 
D)  The technological improvement shifts the supply curve rightward while the increase in the expected future price shifts the supply curve leftward. The net effect is not known. 
A)  The equilibrium price will rise because the supply curve shifts rightward. 
B)  The equilibrium price falls because the supply curve shifts leftward. 
C)  The demand curve shifts rightward and the supply curve does not shift. 
D)  The technological improvement shifts the supply curve rightward while the increase in the expected future price shifts the supply curve leftward. The net effect is not known.

Question 10

Consider gardening books. What will happen to the market for these books as gardening becomes more popular and simultaneously printing costs increase?

Accepted Answer

A)  The quantity of gardening books definitely stays the same. 
B)  The quantity of gardening books definitely increases. 
C)  The price of gardening books definitely increases. 
D)  The price of gardening books might increase or decrease. 
A)  The quantity of gardening books definitely stays the same. 
B)  The quantity of gardening books definitely increases. 
C)  The price of gardening books definitely increases. 
D)  The price of gardening books might increase or decrease.

Question 11

Using supply- and- demand diagrams, show and explain the effects of the following events on the price of
CD- Rs and the quantity of CD- Rs sold. For each event, identify which of the determinants of demand or supply affected, how it influences demand or supply, and what happens to the equilibrium price and quantity.
a) The price of a CD burner falls.
b) Workers who make CD- Rs get a pay raise.
c) Producers introduce new cost- saving technologies in their CD- R production plants.
d) Consumers' incomes increase and CD- Rs are a normal good.
e) Free peer- to- peer music exchange through the Internet becomes legal.

Accepted Answer

@#IMG-DLM& e) The figure above shows the effect of

Question 12

-In the above figure, a change in quantity demanded with unchanged demand is represented by a movement from

Accepted Answer

A)  point a to point b. 
B)  point a to point c. 
C)  point a to point e. 
D)  None of the above represent a change in the quantity demanded with an unchanged demand. 
A)  point a to point b. 
B)  point a to point c. 
C)  point a to point e. 
D)  None of the above represent a change in the quantity demanded with an unchanged demand.

Question 13

Suppose that the technology used to produce computers advances. How does this change affect the supply of computers and the supply curve of computers?

Accepted Answer

An advance in technology incre

Question 14

Explain why a relative price is an opportunity cost.

Accepted Answer

A relative price is the ratio of the pri

Question 15

Walkman Watch expects a recession to occur. Knowing that a Walkman is a normal good, you predict that the demand for a Walkman

Accepted Answer

A)  might increase or decrease. 
B)  will increase. 
C)  will remain unchanged. 
D)  will decrease. 
A)  might increase or decrease. 
B)  will increase. 
C)  will remain unchanged. 
D)  will decrease.

Question 16

In the market for books, the supply of books will decrease if any of the following occur EXCEPT

Accepted Answer

A)  an increase in the future expected price of a book. 
B)  an increase in the price of paper. 
C)  a decrease in the price of a book. 
D)  a decrease in the number of book publishers. 
A)  an increase in the future expected price of a book. 
B)  an increase in the price of paper. 
C)  a decrease in the price of a book. 
D)  a decrease in the number of book publishers.

Question 17

If good A is a normal good and income increases, the equilibrium price of A and the equilibrium quantity of A .

Accepted Answer

A)  falls; increases 
B)  rises; decreases 
C)  rises; increases 
D)  falls; decreases 
A)  falls; increases 
B)  rises; decreases 
C)  rises; increases 
D)  falls; decreases

Question 18

The law of demand states that the quantity of a good demanded varies

Accepted Answer

A)  directly with income. 
B)  inversely with its price. 
C)  inversely with the price of substitute goods. 
D)  directly with population. 
A)  directly with income. 
B)  inversely with its price. 
C)  inversely with the price of substitute goods. 
D)  directly with population.

Question 19

Which of the following correctly describes how price adjustments eliminate a shortage?

Accepted Answer

A)  As the price falls, the quantity demanded decreases while the quantity supplied increases. 
B)  As the price falls, the quantity demanded increases while the quantity supplied decreases. 
C)  As the price rises, the quantity demanded decreases while the quantity supplied increases. 
D)  As the price rises, the quantity demanded increases while the quantity supplied decreases. 
A)  As the price falls, the quantity demanded decreases while the quantity supplied increases. 
B)  As the price falls, the quantity demanded increases while the quantity supplied decreases. 
C)  As the price rises, the quantity demanded decreases while the quantity supplied increases. 
D)  As the price rises, the quantity demanded increases while the quantity supplied decreases.

Question 20

For a "change in the quantity supplied" but not "a change in supply" to occur, there must be a

Accepted Answer

A)  rightward shift of the supply curve. 
B)  leftward shift of the demand curve. 
C)  rightward shift of the demand curve. 
D)  Both answers B and C are correct. 
A)  rightward shift of the supply curve. 
B)  leftward shift of the demand curve. 
C)  rightward shift of the demand curve. 
D)  Both answers B and C are correct.

-In the figure above, which movement reflects a decrease in quantity demanded but NOT a decrease in demand?

The price of a good will fall if

Which of the following shifts the demand curve for hot dogs leftward?

-The above figure represents the market for bicycles. When there is a physical fitness craze the

If the demand for and supply of bathing suits both decrease, then definitely the equilibrium

The price of cereal rises. As a result, people have cereal for breakfast on fewer days and eat eggs instead. This behavior is an example of

-The above figure represents the market for french fries at fast food joints. If the price of potatoes rises and simultaneously people become concerned that french fries can cause heart attacks the

-The above figures show the market for gasoline. Which figure(s) shows the effect of a new U.S. tax on oil that suppliers must pay?

There is a technological advance in the production of a good and simultaneously also an increase in the expected future price. Which of the following will happen?

Consider gardening books. What will happen to the market for these books as gardening becomes more popular and simultaneously printing costs increase?

-In the above figure, a change in quantity demanded with unchanged demand is represented by a movement from

Suppose that the technology used to produce computers advances. How does this change affect the supply of computers and the supply curve of computers?

Explain why a relative price is an opportunity cost.

Walkman Watch expects a recession to occur. Knowing that a Walkman is a normal good, you predict that the demand for a Walkman

In the market for books, the supply of books will decrease if any of the following occur EXCEPT

If good A is a normal good and income increases, the equilibrium price of A and the equilibrium quantity of A .

The law of demand states that the quantity of a good demanded varies

Which of the following correctly describes how price adjustments eliminate a shortage?

For a "change in the quantity supplied" but not "a change in supply" to occur, there must be a

What Is Economics

The Economic Problem

Measuring Gdp and Economic Growth

Monitoring Jobs and Inflation

Economic Growth

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers: They Keynesian Model

U.S. Inflation, Unemployment, and Business Cycle

Fiscal Policy

Monetary Policy

International Trade Policy

Filters

Exam 3: Demand and Supply

-In the figure above, which movement reflects a decrease in quantity demanded but NOT a decrease in demand?

The price of a good will fall if

Which of the following shifts the demand curve for hot dogs leftward?

-The above figure represents the market for bicycles. When there is a physical fitness craze the

If the demand for and supply of bathing suits both decrease, then definitely the equilibrium

The price of cereal rises. As a result, people have cereal for breakfast on fewer days and eat eggs instead. This behavior is an example of

-The above figure represents the market for french fries at fast food joints. If the price of potatoes rises and simultaneously people become concerned that french fries can cause heart attacks the

-The above figures show the market for gasoline. Which figure(s) shows the effect of a new U.S. tax on oil that suppliers must pay?

There is a technological advance in the production of a good and simultaneously also an increase in the expected future price. Which of the following will happen?

Consider gardening books. What will happen to the market for these books as gardening becomes more popular and simultaneously printing costs increase?

-In the above figure, a change in quantity demanded with unchanged demand is represented by a movement from

Suppose that the technology used to produce computers advances. How does this change affect the supply of computers and the supply curve of computers?

Explain why a relative price is an opportunity cost.

Walkman Watch expects a recession to occur. Knowing that a Walkman is a normal good, you predict that the demand for a Walkman

In the market for books, the supply of books will decrease if any of the following occur EXCEPT

If good A is a normal good and income increases, the equilibrium price of A and the equilibrium quantity of A .

The law of demand states that the quantity of a good demanded varies

Which of the following correctly describes how price adjustments eliminate a shortage?

For a "change in the quantity supplied" but not "a change in supply" to occur, there must be a

What Is Economics

The Economic Problem

Measuring Gdp and Economic Growth

Monitoring Jobs and Inflation

Economic Growth

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers: They Keynesian Model

U.S. Inflation, Unemployment, and Business Cycle

Fiscal Policy

Monetary Policy

International Trade Policy

Filters