Question 1

If more buyers came into the market for a good, we would expect to see the market demand curve

Accepted Answer

A) shift inward and to the left. 
B) remain unchanged since none of the determinants of individual demand changed. 
C) shift outward and to the right. 
D) reflect a positive relationship between price and quantity demanded. 
A) shift inward and to the left. 
B) remain unchanged since none of the determinants of individual demand changed. 
C) shift outward and to the right. 
D) reflect a positive relationship between price and quantity demanded.

Question 2

If the price of Pepsi increases, then there will be ________ of Pepsi.

Accepted Answer

A) a decrease in the supply 
B) an increase in the supply 
C) an increase in the quantity supplied 
D) a decrease in the quantity supplied 
A) a decrease in the supply 
B) an increase in the supply 
C) an increase in the quantity supplied 
D) a decrease in the quantity supplied

Question 3

-Refer to the above table. What is the market quantity demanded of DVDs at a price of $12?

Accepted Answer

A) 6 
B) 9 
C) 12 
D) 24 
A) 6 
B) 9 
C) 12 
D) 24

Question 4

The law of demand

Accepted Answer

A) is only an assumption that cannot be tested. 
B) only applies to necessities, not to luxuries. 
C) is supported by observations of human behavior in the marketplace. 
D) does not apply to scarce goods. 
A) is only an assumption that cannot be tested. 
B) only applies to necessities, not to luxuries. 
C) is supported by observations of human behavior in the marketplace. 
D) does not apply to scarce goods.

Question 5

If goods X and Y are substitute goods, then an increase in the price of Y, other things being equal,

Accepted Answer

A) results in a decrease in the amounts of both X and Y consumed. 
B) decreases the quantity demanded of Y, but has no effect on the amount of X consumed. 
C) results in a decrease in the quantity of Y consumed, but increases the demand for X. 
D) has no real effect on the quantity demanded of good Y, but increases the demand for X. 
A) results in a decrease in the amounts of both X and Y consumed. 
B) decreases the quantity demanded of Y, but has no effect on the amount of X consumed. 
C) results in a decrease in the quantity of Y consumed, but increases the demand for X. 
D) has no real effect on the quantity demanded of good Y, but increases the demand for X.

Question 6

The effects of a per-unit tax imposed on sales of an industry's product would likely include

Accepted Answer

A) a lower product price at any amount of the product supplied. 
B) a leftward shift of the market supply curve for the product. 
C) a leftward movement along the market supply curve for the product. 
D) none of the above. 
A) a lower product price at any amount of the product supplied. 
B) a leftward shift of the market supply curve for the product. 
C) a leftward movement along the market supply curve for the product. 
D) none of the above.

Question 7

The demand for orthodontists' services falls as the proportion of the population that obtains braces falls. It may take several years before the new long-run equilibrium for the orthodontic labor market is attained. In the meantime, the orthodontic labor market experiences a

Accepted Answer

A) shortage. 
B) quality decrease. 
C) surplus. 
D) excess demand. 
A) shortage. 
B) quality decrease. 
C) surplus. 
D) excess demand.

Question 8

Four points on a demand schedule are given: $12, 2 units; $10, 1 unit; $15, 1.5 units; and $2, 4 units. Which combination is inconsistent with the law of demand?

Accepted Answer

A) $12 and 2 units 
B) $10 and 1 unit 
C) $15 and 1.5 units 
D) $2 and 4 units 
A) $12 and 2 units 
B) $10 and 1 unit 
C) $15 and 1.5 units 
D) $2 and 4 units

Question 9

Markets are

Accepted Answer

A) a mechanism through which prices of goods and services are determined by the forces of supply and demand. 
B) specific geographic locations. 
C) hypothetical constructs used to analyze how people form their tastes and preferences. 
D) places where people can inspect goods and services carefully. 
A) a mechanism through which prices of goods and services are determined by the forces of supply and demand. 
B) specific geographic locations. 
C) hypothetical constructs used to analyze how people form their tastes and preferences. 
D) places where people can inspect goods and services carefully.

Question 10

Suppose a concert by Lady Gaga and a basketball game played by the L.A. Lakers are substitutes, then which of the following is true?

Accepted Answer

A) If the price of a ticket to a Lakers game increases, then the demand for Lady Gaga tickets will fall. 
B) If the price of a ticket to a Lakers game decreases, the quantity of Lakers tickets demanded will increase. 
C) If the price of a ticket to a Lakers game increases, then the demand for Lady Gaga tickets will remain unchanged. 
D) The price of a ticket to a Lakers game will always equal the price of a ticket to a Lady Gaga concert. 
A) If the price of a ticket to a Lakers game increases, then the demand for Lady Gaga tickets will fall. 
B) If the price of a ticket to a Lakers game decreases, the quantity of Lakers tickets demanded will increase. 
C) If the price of a ticket to a Lakers game increases, then the demand for Lady Gaga tickets will remain unchanged. 
D) The price of a ticket to a Lakers game will always equal the price of a ticket to a Lady Gaga concert.

Question 11

John believes that when the price of a good increases people will purchase more of the good. This statement is

Accepted Answer

A) consistent with the law of demand. 
B) inconsistent with the law of demand. 
C) referring to money prices. 
D) consistent with the law of supply. 
A) consistent with the law of demand. 
B) inconsistent with the law of demand. 
C) referring to money prices. 
D) consistent with the law of supply.

Question 12

-Refer to the above figure. Suppose that Cheerios and Apple Jacks are substitutes. Which diagram shows the effect on the demand for Cheerios when the price of Apple Jacks cereal has decreased?

Accepted Answer

A) A 
B) B 
C) neither graph 
D) both graphs 
A) A 
B) B 
C) neither graph 
D) both graphs

Question 13

-Refer to the above figure. At a price of $6, excess quantity supplied equals

Accepted Answer

A) 0. 
B) 12. 
C) 15. 
D) infinity. 
A) 0. 
B) 12. 
C) 15. 
D) infinity.

Question 14

Which of the following products are likely to be complementary goods?

Accepted Answer

A) Coke and Pepsi 
B) portable MP3 players and batteries 
C) HD-DVDs and Blu-Ray DVDs 
D) Domino's pizza and Papa John's pizza 
A) Coke and Pepsi 
B) portable MP3 players and batteries 
C) HD-DVDs and Blu-Ray DVDs 
D) Domino's pizza and Papa John's pizza

Question 15

-Refer to the above figure. Moving from point A to point B indicates

Accepted Answer

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

Question 16

How is the market supply curve found? In what ways is the process similar to the way the market demand curve is determined? In what ways are they different?

Accepted Answer

The market supply curve is obtained by h

Question 17

Each of the following would cause an increase in the supply of baseballs EXCEPT

Accepted Answer

A) an improvement in technology. 
B) a decrease in the cost of labor used to produce baseballs. 
C) an expectation that the price of baseballs will rise in the future. 
D) an increase in the number of baseball producers. 
A) an improvement in technology. 
B) a decrease in the cost of labor used to produce baseballs. 
C) an expectation that the price of baseballs will rise in the future. 
D) an increase in the number of baseball producers.

Question 18

If the price of margarine falls, the demand for butter will

Accepted Answer

A) remain unchanged. 
B) increase. 
C) decrease. 
D) rise at first and then fall. 
A) remain unchanged. 
B) increase. 
C) decrease. 
D) rise at first and then fall.

Question 19

-Refer to the above table. At a price of $450, there is an

Accepted Answer

A) equilibrium. 
B) excess quantity supplied of 4,000 tablets. 
C) excess quantity demanded of 6,000 tablets. 
D) excess quantity demanded of 9,000 tablets. 
A) equilibrium. 
B) excess quantity supplied of 4,000 tablets. 
C) excess quantity demanded of 6,000 tablets. 
D) excess quantity demanded of 9,000 tablets.

Question 20

If the price of hot dogs increases, the demand for hot dog buns will

Accepted Answer

A) increase. 
B) decrease. 
C) remain constant. 
D) shift to the right. 
A) increase. 
B) decrease. 
C) remain constant. 
D) shift to the right.

Exam 3: Demand and Supply

If more buyers came into the market for a good, we would expect to see the market demand curve

If the price of Pepsi increases, then there will be ________ of Pepsi.

-Refer to the above table. What is the market quantity demanded of DVDs at a price of $12?

The law of demand

If goods X and Y are substitute goods, then an increase in the price of Y, other things being equal,

The effects of a per-unit tax imposed on sales of an industry's product would likely include

The demand for orthodontists' services falls as the proportion of the population that obtains braces falls. It may take several years before the new long-run equilibrium for the orthodontic labor market is attained. In the meantime, the orthodontic labor market experiences a

Four points on a demand schedule are given: $12, 2 units; $10, 1 unit; $15, 1.5 units; and $2, 4 units. Which combination is inconsistent with the law of demand?

Markets are

Suppose a concert by Lady Gaga and a basketball game played by the L.A. Lakers are substitutes, then which of the following is true?

John believes that when the price of a good increases people will purchase more of the good. This statement is

-Refer to the above figure. Suppose that Cheerios and Apple Jacks are substitutes. Which diagram shows the effect on the demand for Cheerios when the price of Apple Jacks cereal has decreased?

-Refer to the above figure. At a price of $6, excess quantity supplied equals

Which of the following products are likely to be complementary goods?

-Refer to the above figure. Moving from point A to point B indicates

How is the market supply curve found? In what ways is the process similar to the way the market demand curve is determined? In what ways are they different?

Each of the following would cause an increase in the supply of baseballs EXCEPT

If the price of margarine falls, the demand for butter will

-Refer to the above table. At a price of $450, there is an

If the price of hot dogs increases, the demand for hot dog buns will

The Nature of Economics

Scarcity and the World of Trade-Offs

Extensions of Demand and Supply Analysis

Public Spending and Public Choice

Funding the Public Sector

Demand and Supply Elasticity

Consumer Choice

Rents, Profits, and the Financial Environment of Business

The Firm: Cost and Output Determination

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly and Strategic Behavior

Regulation and Antitrust Policy in a Globalized Economy

The Labor Market: Demand, Supply and Outsourcing

Unions and Labor Market Monopoly Power

Income, Poverty, and Health Care

Environmental Economics

Comparative Advantage and the Open Economy

Exchange Rates and the Balance of Payments

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