Question 1

The ʺlaw of supplyʺ states that, other things remaining the same, firms produce

Accepted Answer

A)  less of a good as the required resources become scarcer. 
B)  more of a good the less it costs to produce it. 
C)  less of a good the more it costs to produce it. 
D)  more of a good the higher its price. 
A)  less of a good as the required resources become scarcer. 
B)  more of a good the less it costs to produce it. 
C)  less of a good the more it costs to produce it. 
D)  more of a good the higher its price. D

Question 2

Each point on the demand curve reflects

Accepted Answer

A)  the lowest-cost technology available to produce a good. 
B)  the highest price consumers are willing and able to pay for that particular unit of a good. 
C)  all the wants of a given household. 
D)  the highest price sellers will accept for all units they are producing. 
A)  the lowest-cost technology available to produce a good. 
B)  the highest price consumers are willing and able to pay for that particular unit of a good. 
C)  all the wants of a given household. 
D)  the highest price sellers will accept for all units they are producing. B

Question 3

-The figure above shows supply curves for soft drinks. Suppose the economy is at point a. An increase in the number of suppliers would be shown as a movement from point a to a point such as

Accepted Answer

A)  none of the points that are illustrated. 
B)  point b. 
C)  point c. 
D)  point d. 
A)  none of the points that are illustrated. 
B)  point b. 
C)  point c. 
D)  point d. B

Question 4

Apples are a normal good, so if the price of an apple increases from 50 ¢ to 60¢, the quantity of apples demanded decrease because of

Accepted Answer

A)  a change in income. 
B)  the substitution effect only. 
C)  the income effect only. 
D)  the substitution and income effects. 
A)  a change in income. 
B)  the substitution effect only. 
C)  the income effect only. 
D)  the substitution and income effects.

Question 5

List the factors that change supply and shift the supply curve. Tell what happens to supply and the supply curve when there is an increase in the factor.

Accepted Answer

The factors that change supply are techn

Question 6

Suppose the price of a football is $20.00 and the price of a basketball is $10.00. The __________of a football is____________ .

Accepted Answer

A)  relative price; 1/2 basketball per football 
B)  relative price; 2 basketballs per football 
C)  opportunity cost; $10.00 
D)  opportunity cost; $20.00 
A)  relative price; 1/2 basketball per football 
B)  relative price; 2 basketballs per football 
C)  opportunity cost; $10.00 
D)  opportunity cost; $20.00

Question 7

If there exists a shortage in the market for snowmobiles, then the price of a snowmobile will

Accepted Answer

A)  fall. 
B)  neither rise nor fall. 
C)  at first fall then rise. 
D)  rise. 
A)  fall. 
B)  neither rise nor fall. 
C)  at first fall then rise. 
D)  rise.

Question 8

The opportunity cost of a good is the same as its

Accepted Answer

A)  relative price. 
B)  price index. 
C)  money price. 
D)  none of the above 
A)  relative price. 
B)  price index. 
C)  money price. 
D)  none of the above

Question 9

-The above figures show the market for hamburger meat. Which figure shows the effect of a newly invented machine which grinds beef at twice the speed previously possible?

Accepted Answer

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

Question 10

Producers of DVDs are able to lower the wage rate that they pay to their workers. You predict that the

Accepted Answer

A)  supply curve will shift leftward. 
B)  supply curve will shift rightward. 
C)  quantity supplied will decrease. 
D)  price will rise. 
A)  supply curve will shift leftward. 
B)  supply curve will shift rightward. 
C)  quantity supplied will decrease. 
D)  price will rise.

Question 11

You notice that the price and quantity of wheat both decrease. This observation can be the result of the

Accepted Answer

A)  supply curve of wheat shifting rightward. 
B)  demand curve for wheat shifting leftward. 
C)  demand curve for wheat shifting rightward. 
D)  supply curve of wheat shifting leftward. 
A)  supply curve of wheat shifting rightward. 
B)  demand curve for wheat shifting leftward. 
C)  demand curve for wheat shifting rightward. 
D)  supply curve of wheat shifting leftward.

Question 12

The supply curve indicates the minimum quantity that a producer would be willing to supply at alternative prices.

Accepted Answer

A) True 
 B)False

Question 13

A relative price is the

Accepted Answer

A)  difference between one money price and another. 
B)  ratio of one money price to another. 
C)  slope of the demand curve. 
D)  slope of the supply curve. 
A)  difference between one money price and another. 
B)  ratio of one money price to another. 
C)  slope of the demand curve. 
D)  slope of the supply curve.

Question 14

If consumers but not producers expect that the price of soda will rise in November, the

Accepted Answer

A)  demand for soda in October will decrease. 
B)  demand for soda in October will increase. 
C)  supply of soda in October will increase. 
D)  supply of soda in October will decrease. 
A)  demand for soda in October will decrease. 
B)  demand for soda in October will increase. 
C)  supply of soda in October will increase. 
D)  supply of soda in October will decrease.

Question 15

A normal good is one

Accepted Answer

A)  with a downward sloping demand curve. 
B)  for which demand increases when income increases. 
C)  for which demand increases when the price of a substitute rises. 
D)  none of the above 
A)  with a downward sloping demand curve. 
B)  for which demand increases when income increases. 
C)  for which demand increases when the price of a substitute rises. 
D)  none of the above

Question 16

Cable television companies must pay increased charges by the networks for the programs the cable companies carry. As a result, the price of cable television rises. Thus

Accepted Answer

A)  the demand curve for cable television service shifts rightward. 
B)  there is a movement down the demand curve for cable television to a higher quantity demanded. 
C)  there is a movement up the demand curve for cable television to a smaller quantity demanded. 
D)  the demand curve for cable television service shifts leftward. 
A)  the demand curve for cable television service shifts rightward. 
B)  there is a movement down the demand curve for cable television to a higher quantity demanded. 
C)  there is a movement up the demand curve for cable television to a smaller quantity demanded. 
D)  the demand curve for cable television service shifts leftward.

Question 17

By definition, an inferior good is a

Accepted Answer

A)  good for which demand decreases when its price rises. 
B)  want that is not expressed by demand. 
C)  good for which demand decreases when income increases. 
D)  normal substitute good. 
A)  good for which demand decreases when its price rises. 
B)  want that is not expressed by demand. 
C)  good for which demand decreases when income increases. 
D)  normal substitute good.

Question 18

Suppose a market begins in equilibrium. If supply increases, then at the original equilibrium price the quantity demanded is

Accepted Answer

A)  is less than the quantity supplied and a shortage results. 
B)  exceeds the quantity supplied and a shortage results. 
C)  exceeds the quantity supplied and a surplus results. 
D)  is less than the quantity supplied and a surplus results. 
A)  is less than the quantity supplied and a shortage results. 
B)  exceeds the quantity supplied and a shortage results. 
C)  exceeds the quantity supplied and a surplus results. 
D)  is less than the quantity supplied and a surplus results.

Question 19

-The above figures show the market for hamburger meat. Which figures) shows the effect of an increase in the price of a hamburger bun, a complement for hamburger meat?

Accepted Answer

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

Question 20

If the price of a movie download falls, the rental rate of DVDs and the equilibrium quantity of DVDs rented .

Accepted Answer

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

The ʺlaw of supplyʺ states that, other things remaining the same, firms produce

Each point on the demand curve reflects

-The figure above shows supply curves for soft drinks. Suppose the economy is at point a. An increase in the number of suppliers would be shown as a movement from point a to a point such as

Apples are a normal good, so if the price of an apple increases from 50 ¢ to 60¢, the quantity of apples demanded decrease because of

List the factors that change supply and shift the supply curve. Tell what happens to supply and the supply curve when there is an increase in the factor.

Suppose the price of a football is $20.00 and the price of a basketball is $10.00. The of a football is__ .

If there exists a shortage in the market for snowmobiles, then the price of a snowmobile will

The opportunity cost of a good is the same as its

-The above figures show the market for hamburger meat. Which figure shows the effect of a newly invented machine which grinds beef at twice the speed previously possible?

Producers of DVDs are able to lower the wage rate that they pay to their workers. You predict that the

You notice that the price and quantity of wheat both decrease. This observation can be the result of the

The supply curve indicates the minimum quantity that a producer would be willing to supply at alternative prices.

A relative price is the

If consumers but not producers expect that the price of soda will rise in November, the

A normal good is one

Cable television companies must pay increased charges by the networks for the programs the cable companies carry. As a result, the price of cable television rises. Thus

By definition, an inferior good is a

Suppose a market begins in equilibrium. If supply increases, then at the original equilibrium price the quantity demanded is

-The above figures show the market for hamburger meat. Which figures) shows the effect of an increase in the price of a hamburger bun, a complement for hamburger meat?

If the price of a movie download falls, the rental rate of DVDs and the equilibrium quantity of DVDs rented .

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: the Keynesian Model

U.S Inflation, Unemployment, and Business Cycle

Fiscal Policy

Monetary Policy

International Trade Policy

Review

Filters

Exam 3: Demand and Supply

The ʺlaw of supplyʺ states that, other things remaining the same, firms produce

Each point on the demand curve reflects

-The figure above shows supply curves for soft drinks. Suppose the economy is at point a. An increase in the number of suppliers would be shown as a movement from point a to a point such as

Apples are a normal good, so if the price of an apple increases from 50 ¢ to 60¢, the quantity of apples demanded decrease because of

List the factors that change supply and shift the supply curve. Tell what happens to supply and the supply curve when there is an increase in the factor.

Suppose the price of a football is $20.00 and the price of a basketball is $10.00. The __________of a football is____________ .

If there exists a shortage in the market for snowmobiles, then the price of a snowmobile will

The opportunity cost of a good is the same as its

-The above figures show the market for hamburger meat. Which figure shows the effect of a newly invented machine which grinds beef at twice the speed previously possible?

Producers of DVDs are able to lower the wage rate that they pay to their workers. You predict that the

You notice that the price and quantity of wheat both decrease. This observation can be the result of the

The supply curve indicates the minimum quantity that a producer would be willing to supply at alternative prices.

A relative price is the

If consumers but not producers expect that the price of soda will rise in November, the

A normal good is one

Cable television companies must pay increased charges by the networks for the programs the cable companies carry. As a result, the price of cable television rises. Thus

By definition, an inferior good is a

Suppose a market begins in equilibrium. If supply increases, then at the original equilibrium price the quantity demanded is

-The above figures show the market for hamburger meat. Which figures) shows the effect of an increase in the price of a hamburger bun, a complement for hamburger meat?

If the price of a movie download falls, the rental rate of DVDs and the equilibrium quantity of DVDs rented .

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: the Keynesian Model

U.S Inflation, Unemployment, and Business Cycle

Fiscal Policy

Monetary Policy

International Trade Policy

Review

Filters

Suppose the price of a football is $20.00 and the price of a basketball is $10.00. The of a football is__ .