Question 1

A decrease in demand will have what effect on equilibrium price and quantity?

Accepted Answer

A)  Price will increase; quantity will decrease. 
B)  Price will decrease; quantity will increase. 
C)  Both price and quantity will increase. 
D)  Both price and quantity will decrease. 
A)  Price will increase; quantity will decrease. 
B)  Price will decrease; quantity will increase. 
C)  Both price and quantity will increase. 
D)  Both price and quantity will decrease.

Question 2

Professional baseball teams in the United States use only wooden bats.If aluminum bats were permitted,the likely result would be a

Accepted Answer

A)  shift in the supply curve for aluminum bats. 
B)  shift in the supply curve for wooden bats. 
C)  change in the quantity supplied of aluminum bats. 
D)  persistent shortage of aluminum bats. 
A)  shift in the supply curve for aluminum bats. 
B)  shift in the supply curve for wooden bats. 
C)  change in the quantity supplied of aluminum bats. 
D)  persistent shortage of aluminum bats.

Question 3

The imposition of price ceilings on a market often results in

Accepted Answer

A)  an increase in investment in the industry. 
B)  a persistent surplus in the market. 
C)  the diversion of income toward black-market suppliers. 
D)  lower prices being offered on the black market. 
A)  an increase in investment in the industry. 
B)  a persistent surplus in the market. 
C)  the diversion of income toward black-market suppliers. 
D)  lower prices being offered on the black market.

Question 4

When there is an increase in demand,

Accepted Answer

A)  the demand curve shifts toward the origin of the graph. 
B)  the demand curve twists clockwise. 
C)  the demand curve shifts away from the origin of the graph. 
D)  the demand curve twists counterclockwise. 
E)  a lower price has increased the amount of the good that consumers will buy. 
A)  the demand curve shifts toward the origin of the graph. 
B)  the demand curve twists clockwise. 
C)  the demand curve shifts away from the origin of the graph. 
D)  the demand curve twists counterclockwise. 
E)  a lower price has increased the amount of the good that consumers will buy.

Question 5

The price for labor is the wage rate.What happens to the quantity of labor supplied if wages increase?

Accepted Answer

A)  It increases. 
B)  It decreases. 
C)  It does not change. 
D)  Uncertain-economic theory has no answer to this question. 
A)  It increases. 
B)  It decreases. 
C)  It does not change. 
D)  Uncertain-economic theory has no answer to this question.

Question 6

The quantity of goods exchanged in a market will be below the equilibrium quantity

Accepted Answer

A)  when the price is either held above or below the equilibrium price. 
B)  only when the price is held above the equilibrium price. 
C)  only when the price is held below the equilibrium price. 
D)  only when the price is rising. 
A)  when the price is either held above or below the equilibrium price. 
B)  only when the price is held above the equilibrium price. 
C)  only when the price is held below the equilibrium price. 
D)  only when the price is rising.

Question 7

How will an increase in price tend to affect demand?

Accepted Answer

A)  Demand will increase. 
B)  Demand will decrease. 
C)  Demand will not change. 
D)  Uncertain. 
A)  Demand will increase. 
B)  Demand will decrease. 
C)  Demand will not change. 
D)  Uncertain.

Question 8

Figure 4-11  
-The Russian government has restricted sugar availability to reduce the supply of illegal liquor (sugar is used to increase alcohol content).Russians also like to sweeten their tea with jam,another sugar product.Which graph in Figure 4-11 depicts the impact of sugar rationing on the Russian tea market?

Accepted Answer

A)  1 
B)  2 
C)  3 
D)  4 
A)  1 
B)  2 
C)  3 
D)  4

Question 9

An important assumption that is made when constructing a demand schedule is that

Accepted Answer

A)  only price and quantity matter in determining demand. 
B)  people always want a certain amount of a product. 
C)  demand is too important to be left to the economists. 
D)  all other determinants of demand are held constant. 
E)  demand has a positive slope. 
A)  only price and quantity matter in determining demand. 
B)  people always want a certain amount of a product. 
C)  demand is too important to be left to the economists. 
D)  all other determinants of demand are held constant. 
E)  demand has a positive slope.

Question 10

A demand schedule shows the time over which different quantities will be demanded.

Accepted Answer

A) True 
 B)False

Question 11

A shift in the demand curve for sailboats resulting from an increase in incomes will lead to

Accepted Answer

A)  higher prices of sailboats. 
B)  lower prices of sailboats. 
C)  a corresponding shift in the supply curve for sailboats. 
D)  lower output of sailboats. 
E)  no change in the price of sailboats. 
A)  higher prices of sailboats. 
B)  lower prices of sailboats. 
C)  a corresponding shift in the supply curve for sailboats. 
D)  lower output of sailboats. 
E)  no change in the price of sailboats.

Question 12

For more than a thousand years,the Catholic Church required its members to abstain from meat on Fridays.Catholics customarily ate fish on Friday.After 1966 abstinence from meat on Fridays was no longer required.Consequently,the

Accepted Answer

A)  demand curve for fish shifted to the right. 
B)  demand curve for fish shifted to the left. 
C)  demand for meat decreased. 
D)  price of fish increased. 
A)  demand curve for fish shifted to the right. 
B)  demand curve for fish shifted to the left. 
C)  demand for meat decreased. 
D)  price of fish increased.

Question 13

The ____ the demand curve for a good,the ____ the change in equilibrium quantity after a shift of the supply curve.

Accepted Answer

A)  flatter; greater 
B)  flatter; smaller 
C)  farther from the origin at every output level; greater 
D)  farther from the origin at every output level; smaller 
A)  flatter; greater 
B)  flatter; smaller 
C)  farther from the origin at every output level; greater 
D)  farther from the origin at every output level; smaller

Question 14

Shortages normally accompany an effective price floor.

Accepted Answer

A) True 
 B)False

Question 15

Technological advances that allow a good to be produced at a lower cost will shift the demand curve rightward.

Accepted Answer

A) True 
 B)False

Question 16

Figure 4-6  
-Two studies published in the New England Journal of Medicine link the risk of breast cancer to alcohol consumption.Young women who have nine drinks per week were reportedly 150 percent more likely to develop breast cancer.Considering the market for alcohol,an economist would predict a movement

Accepted Answer

A)  up the demand curve as quantity demanded falls. 
B)  up the supply curve as the demand curve shifts. 
C)  down the supply curve as the demand curve shifts. 
D)  down the demand curve as quantity falls. 
A)  up the demand curve as quantity demanded falls. 
B)  up the supply curve as the demand curve shifts. 
C)  down the supply curve as the demand curve shifts. 
D)  down the demand curve as quantity falls.

Question 17

If oranges and grapefruit are close substitutes,an increase in the price of oranges will shift the demand curve of

Accepted Answer

A)  both products to the right. 
B)  both products to the left. 
C)  grapefruit to the right. 
D)  oranges to the left. 
A)  both products to the right. 
B)  both products to the left. 
C)  grapefruit to the right. 
D)  oranges to the left.

Question 18

Which of the following is a symptom of a price floor?

Accepted Answer

A)  scalping of Super Bowl tickets 
B)  surplus cheese 
C)  the New York city housing shortage 
D)  black markets 
E)  milk shortages 
A)  scalping of Super Bowl tickets 
B)  surplus cheese 
C)  the New York city housing shortage 
D)  black markets 
E)  milk shortages

Question 19

A shift of the demand curve for a good occurs whenever new technologies make inputs used in producing that good available at lower prices.

Accepted Answer

A) True 
 B)False

Question 20

If the supply curve for housing has the normal positive slope,rent controls will likely

Accepted Answer

A)  increase the amount of housing. 
B)  improve the quality of housing. 
C)  aggravate the housing shortage. 
D)  help low-income families find suitable housing. 
E)  increase the demand for housing. 
A)  increase the amount of housing. 
B)  improve the quality of housing. 
C)  aggravate the housing shortage. 
D)  help low-income families find suitable housing. 
E)  increase the demand for housing.

A decrease in demand will have what effect on equilibrium price and quantity?

Professional baseball teams in the United States use only wooden bats.If aluminum bats were permitted,the likely result would be a

The imposition of price ceilings on a market often results in

When there is an increase in demand,

The price for labor is the wage rate.What happens to the quantity of labor supplied if wages increase?

The quantity of goods exchanged in a market will be below the equilibrium quantity

How will an increase in price tend to affect demand?

An important assumption that is made when constructing a demand schedule is that

A demand schedule shows the time over which different quantities will be demanded.

A shift in the demand curve for sailboats resulting from an increase in incomes will lead to

For more than a thousand years,the Catholic Church required its members to abstain from meat on Fridays.Catholics customarily ate fish on Friday.After 1966 abstinence from meat on Fridays was no longer required.Consequently,the

The the demand curve for a good,the the change in equilibrium quantity after a shift of the supply curve.

Shortages normally accompany an effective price floor.

Technological advances that allow a good to be produced at a lower cost will shift the demand curve rightward.

If oranges and grapefruit are close substitutes,an increase in the price of oranges will shift the demand curve of

Which of the following is a symptom of a price floor?

A shift of the demand curve for a good occurs whenever new technologies make inputs used in producing that good available at lower prices.

If the supply curve for housing has the normal positive slope,rent controls will likely

What Is Economics

The Economy Myth and Reality

The Fundamental Economic Problem Scarcity and Choice

An Introduction To Macroeconomics

The Goals Of Macroeconomic Policy

Economic Growth Theory And Policy

Aggregate Demand and The Powerful Consumer

Demand Side Equilibrium Unemployment Or Inflation

Bringing In The Supply Side Unemployment and Inflation

Managing Aggregate Demand Fiscal Policy

Money and The Banking System

Monetary Policy Conventional and Unconventional

The Financial Crisis and The Great Recession

The Debate Over Monetary and Fiscal Policy

Budget Deficits In The Short and Long Run

The Trade Off Between Inflation and Unemployment

International Trade and Comparative Advantage

The International Monetary System Order Or Disorder

Exchange Rates and The Macroeconomy

Filters

Exam 4: Supply and Demand An Initial Look

A decrease in demand will have what effect on equilibrium price and quantity?

Professional baseball teams in the United States use only wooden bats.If aluminum bats were permitted,the likely result would be a

The imposition of price ceilings on a market often results in

When there is an increase in demand,

The price for labor is the wage rate.What happens to the quantity of labor supplied if wages increase?

The quantity of goods exchanged in a market will be below the equilibrium quantity

How will an increase in price tend to affect demand?

An important assumption that is made when constructing a demand schedule is that

A demand schedule shows the time over which different quantities will be demanded.

A shift in the demand curve for sailboats resulting from an increase in incomes will lead to

For more than a thousand years,the Catholic Church required its members to abstain from meat on Fridays.Catholics customarily ate fish on Friday.After 1966 abstinence from meat on Fridays was no longer required.Consequently,the

The ____ the demand curve for a good,the ____ the change in equilibrium quantity after a shift of the supply curve.

Shortages normally accompany an effective price floor.

Technological advances that allow a good to be produced at a lower cost will shift the demand curve rightward.

If oranges and grapefruit are close substitutes,an increase in the price of oranges will shift the demand curve of

Which of the following is a symptom of a price floor?

A shift of the demand curve for a good occurs whenever new technologies make inputs used in producing that good available at lower prices.

If the supply curve for housing has the normal positive slope,rent controls will likely

What Is Economics

The Economy Myth and Reality

The Fundamental Economic Problem Scarcity and Choice

An Introduction To Macroeconomics

The Goals Of Macroeconomic Policy

Economic Growth Theory And Policy

Aggregate Demand and The Powerful Consumer

Demand Side Equilibrium Unemployment Or Inflation

Bringing In The Supply Side Unemployment and Inflation

Managing Aggregate Demand Fiscal Policy

Money and The Banking System

Monetary Policy Conventional and Unconventional

The Financial Crisis and The Great Recession

The Debate Over Monetary and Fiscal Policy

Budget Deficits In The Short and Long Run

The Trade Off Between Inflation and Unemployment

International Trade and Comparative Advantage

The International Monetary System Order Or Disorder

Exchange Rates and The Macroeconomy

Filters

The the demand curve for a good,the the change in equilibrium quantity after a shift of the supply curve.