Question 1

An increase in the expected future price of a good

Accepted Answer

A)  increases its supply. 
B)  decreases its demand. 
C)  increases its demand. 
D)  has no effect on either its demand or its supply. 
A)  increases its supply. 
B)  decreases its demand. 
C)  increases its demand. 
D)  has no effect on either its demand or its supply. C

Question 2

The observation that the demand curve for grape jam shifts rightward every time the price of peanut butter falls, means that grape jam and peanut butter are

Accepted Answer

A)  complements. 
B)  inferior goods. 
C)  substitutes. 
D)  normal goods. 
A)  complements. 
B)  inferior goods. 
C)  substitutes. 
D)  normal goods. A

Question 3

The "law of demand" states that

Accepted Answer

A)  the quantity demanded of a good is inversely related to the quantity supplied. 
B)  demand for a good is directly related to its price. 
C)  the quantity demanded of a good is inversely related to its price. 
D)  demand for a good is directly related to its supply. 
A)  the quantity demanded of a good is inversely related to the quantity supplied. 
B)  demand for a good is directly related to its price. 
C)  the quantity demanded of a good is inversely related to its price. 
D)  demand for a good is directly related to its supply. C

Question 4

The quantity supplied of a good is

Accepted Answer

A)  equal to the difference between the quantity available and the quantity desired by all consumers and producers. 
B)  the same thing as the quantity demanded at each price. 
C)  the amount the firm would sell if it faced no resource constraints. 
D)  the amount that the producers are planning to sell at a particular price during a given time period. 
A)  equal to the difference between the quantity available and the quantity desired by all consumers and producers. 
B)  the same thing as the quantity demanded at each price. 
C)  the amount the firm would sell if it faced no resource constraints. 
D)  the amount that the producers are planning to sell at a particular price during a given time period.

Question 5

A relative price is

Accepted Answer

A)  the ratio of one price to another price. 
B)  the number of dollars that must be given up in exchange for the good. 
C)  also called the money price. 
D)  not an opportunity cost. 
A)  the ratio of one price to another price. 
B)  the number of dollars that must be given up in exchange for the good. 
C)  also called the money price. 
D)  not an opportunity cost.

Question 6

If the price of a video rental is below its equilibrium price, there will be a _______ of video rentals and the price will _______.

Accepted Answer

A)  surplus; fall 
B)  shortage; fall 
C)  surplus; rise 
D)  shortage; rise 
A)  surplus; fall 
B)  shortage; fall 
C)  surplus; rise 
D)  shortage; rise

Question 7

-In the above figure, if D2 is the original demand curve and the price of a substitute in consumption rises, which price and quantity might result?

Accepted Answer

A)  Point a, with price P2 and quantity Q2. 
B)  Point b, with price P1 and quantity Q1. 
C)  Point c, with price P3 and quantity Q3. 
D)  Point d, with price P1 and quantity Q3. 
A)  Point a, with price P2 and quantity Q2. 
B)  Point b, with price P1 and quantity Q1. 
C)  Point c, with price P3 and quantity Q3. 
D)  Point d, with price P1 and quantity Q3.

Question 8

Which of the following is true?

Accepted Answer

A)  An increase in population shifts the demand curve for most goods leftward. 
B)  If consumers expect the price of a good will rise in the future, the demand curve shifts leftward. 
C)  For an inferior good, when income increases, the demand curve shifts leftward. 
D)  The demand curve for a good shifts leftward when the price of a substitute rises. 
A)  An increase in population shifts the demand curve for most goods leftward. 
B)  If consumers expect the price of a good will rise in the future, the demand curve shifts leftward. 
C)  For an inferior good, when income increases, the demand curve shifts leftward. 
D)  The demand curve for a good shifts leftward when the price of a substitute rises.

Question 9

-The above table gives the demand and supply schedules for Blu- ray discs. Suppose that the price of a Blu- ray disc player increases, resulting in the demand for Blu- ray discs decreasing by 8,000 units at all prices. What are the new equilibrium quantity and equilibrium price of Blu- ray discs?

Accepted Answer

A)  16,000 and $16 
B)  8,000 and $8 
C)  20,000 and $20 
D)  28,000 and $28 
A)  16,000 and $16 
B)  8,000 and $8 
C)  20,000 and $20 
D)  28,000 and $28

Question 10

When income increases, the demand curve for X shifts rightward and the demand curve for Y shifts leftward. These shifts mean that

Accepted Answer

A)  X and Y are both normal goods. 
B)  X is a normal good and Y is an inferior good. 
C)  X is an inferior good and Y is a normal good. 
D)  X and Y are complements. 
A)  X and Y are both normal goods. 
B)  X is a normal good and Y is an inferior good. 
C)  X is an inferior good and Y is a normal good. 
D)  X and Y are complements.

Question 11

An unusually warm winter shifts the

Accepted Answer

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

Question 12

Which of the following shifts the demand curve for movie downloads rightward?

Accepted Answer

A)  A decrease in the price of cable television service 
B)  An increase in the quantity and quality of programming included in the basic cable television service package 
C)  A decrease in the price of downloading a movie 
D)  A 10 per cent increase in people's income if movie downloads are a normal good 
A)  A decrease in the price of cable television service 
B)  An increase in the quantity and quality of programming included in the basic cable television service package 
C)  A decrease in the price of downloading a movie 
D)  A 10 per cent increase in people's income if movie downloads are a normal good

Question 13

If the price of crude oil falls, the equilibrium price of petrol _______ and the equilibrium quantity _______.

Accepted Answer

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

Question 14

Which of the following will NOT shift the supply curve for pick- up trucks?

Accepted Answer

A)  A technological advance 
B)  A change in the number of firms supplying pick- up trucks 
C)  An increase in the price of a resource used to produce pick- up trucks 
D)  A change in the price of pick- up trucks 
A)  A technological advance 
B)  A change in the number of firms supplying pick- up trucks 
C)  An increase in the price of a resource used to produce pick- up trucks 
D)  A change in the price of pick- up trucks

Question 15

When demand increases, the equilibrium price _______and the equilibrium quantity _______.

Accepted Answer

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

Question 16

For normal goods, which of the following explain why demand curves slope downward?

Accepted Answer

A)  Prices and income 
B)  Substitutes and complements 
C)  Substitution effect and income effect 
D)  Resources and technology 
A)  Prices and income 
B)  Substitutes and complements 
C)  Substitution effect and income effect 
D)  Resources and technology

Question 17

-In the figure above, a decrease in the quantity of oil supplied but NOT a decrease in the supply of oil is shown by a movement from

Accepted Answer

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

Question 18

If both the demand and supply increase, the equilibrium quantity _______ and the equilibrium price _______.

Accepted Answer

A)  increases; falls 
B)  decreases; rises 
C)  decreases; might rise, fall or not change 
D)  increases; might rise, fall or not change 
A)  increases; falls 
B)  decreases; rises 
C)  decreases; might rise, fall or not change 
D)  increases; might rise, fall or not change

Question 19

A decrease in the expected future price of cars

Accepted Answer

A)  increases the current quantity demanded of cars, that is, there is a movement downward along the demand curve for cars. 
B)  decreases the current demand for cars, that is, there is a leftward shift of the demand curve for cars. 
C)  increases the current demand for cars, that is, there is a rightward shift of the demand curve for cars. 
D)  decreases the current quantity demanded of cars, that is, there is a movement upward along the demand curve for cars. 
A)  increases the current quantity demanded of cars, that is, there is a movement downward along the demand curve for cars. 
B)  decreases the current demand for cars, that is, there is a leftward shift of the demand curve for cars. 
C)  increases the current demand for cars, that is, there is a rightward shift of the demand curve for cars. 
D)  decreases the current quantity demanded of cars, that is, there is a movement upward along the demand curve for cars.

Question 20

Which of the following statements is correct?

Accepted Answer

A)  When demand increases, both the price and the quantity increase. 
B)  When supply decreases, both the price and the quantity decrease. 
C)  When demand decreases, the price rises and the quantity decreases. 
D)  When supply increases, the quantity decreases and the price rises. 
A)  When demand increases, both the price and the quantity increase. 
B)  When supply decreases, both the price and the quantity decrease. 
C)  When demand decreases, the price rises and the quantity decreases. 
D)  When supply increases, the quantity decreases and the price rises.

An increase in the expected future price of a good

The observation that the demand curve for grape jam shifts rightward every time the price of peanut butter falls, means that grape jam and peanut butter are

The "law of demand" states that

The quantity supplied of a good is

A relative price is

If the price of a video rental is below its equilibrium price, there will be a _ of video rentals and the price will _.

-In the above figure, if D2 is the original demand curve and the price of a substitute in consumption rises, which price and quantity might result?

Which of the following is true?

-The above table gives the demand and supply schedules for Blu- ray discs. Suppose that the price of a Blu- ray disc player increases, resulting in the demand for Blu- ray discs decreasing by 8,000 units at all prices. What are the new equilibrium quantity and equilibrium price of Blu- ray discs?

When income increases, the demand curve for X shifts rightward and the demand curve for Y shifts leftward. These shifts mean that

An unusually warm winter shifts the

Which of the following shifts the demand curve for movie downloads rightward?

If the price of crude oil falls, the equilibrium price of petrol _ and the equilibrium quantity _.

Which of the following will NOT shift the supply curve for pick- up trucks?

When demand increases, the equilibrium price _and the equilibrium quantity _.

For normal goods, which of the following explain why demand curves slope downward?

-In the figure above, a decrease in the quantity of oil supplied but NOT a decrease in the supply of oil is shown by a movement from

If both the demand and supply increase, the equilibrium quantity _ and the equilibrium price _.

A decrease in the expected future price of cars

Which of the following statements is correct?

What Is Economics

The Economic Problem

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Public Choices and Public Goods

Economics of the Environment

Monopoly and Its Regulation

Economic Inequality

Consumer Choices and Constraints

Producer Choices and Constraints

Perfect Competition

Monopolistic Competition

Oligopoly Games and Strategy

Decisions in Factor Markets

Filters

Exam 3: Demand and Supply

An increase in the expected future price of a good

The observation that the demand curve for grape jam shifts rightward every time the price of peanut butter falls, means that grape jam and peanut butter are

The "law of demand" states that

The quantity supplied of a good is

A relative price is

If the price of a video rental is below its equilibrium price, there will be a _______ of video rentals and the price will _______.

-In the above figure, if D2 is the original demand curve and the price of a substitute in consumption rises, which price and quantity might result?

Which of the following is true?

-The above table gives the demand and supply schedules for Blu- ray discs. Suppose that the price of a Blu- ray disc player increases, resulting in the demand for Blu- ray discs decreasing by 8,000 units at all prices. What are the new equilibrium quantity and equilibrium price of Blu- ray discs?

When income increases, the demand curve for X shifts rightward and the demand curve for Y shifts leftward. These shifts mean that

An unusually warm winter shifts the

Which of the following shifts the demand curve for movie downloads rightward?

If the price of crude oil falls, the equilibrium price of petrol _______ and the equilibrium quantity _______.

Which of the following will NOT shift the supply curve for pick- up trucks?

When demand increases, the equilibrium price _______and the equilibrium quantity _______.

For normal goods, which of the following explain why demand curves slope downward?

-In the figure above, a decrease in the quantity of oil supplied but NOT a decrease in the supply of oil is shown by a movement from

If both the demand and supply increase, the equilibrium quantity _______ and the equilibrium price _______.

A decrease in the expected future price of cars

Which of the following statements is correct?

What Is Economics

The Economic Problem

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Public Choices and Public Goods

Economics of the Environment

Monopoly and Its Regulation

Economic Inequality

Consumer Choices and Constraints

Producer Choices and Constraints

Perfect Competition

Monopolistic Competition

Oligopoly Games and Strategy

Decisions in Factor Markets

Filters

If the price of a video rental is below its equilibrium price, there will be a _ of video rentals and the price will _.

If the price of crude oil falls, the equilibrium price of petrol _ and the equilibrium quantity _.

When demand increases, the equilibrium price _and the equilibrium quantity _.

If both the demand and supply increase, the equilibrium quantity _ and the equilibrium price _.