Question 1

What are substitutes in production?

Accepted Answer

Goods are substitutes in produ

Question 2

In 2014, the price of peanuts was rising, which lead peanut butter sellers and peanut butter buyers to expect the price of peanut butter would rise in the future. In the current market for peanut butter, the price falls and the quantity decreases. This set of results means that

Accepted Answer

A)  supply decreased by more than demand increased. 
B)  demand increased by more than supply decreased. 
C)  demand increased by more than supply increased. 
D)  supply decreased by more than demand decreased. 
A)  supply decreased by more than demand increased. 
B)  demand increased by more than supply decreased. 
C)  demand increased by more than supply increased. 
D)  supply decreased by more than demand decreased.

Question 3

-The above figures show the market for hamburger meat. Which figure(s) shows the effect of a nation-wide strike by butchers and meat-packers?

Accepted Answer

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

Question 4

In the market for bicycles, explain what happens to the supply and demand curves when there is an increase in the price of steel used to make bikes.

Accepted Answer

An increase in the price of steel is an

Question 5

What is the effect on the price and quantity of wooden desks of a rise in the price of wood?

Accepted Answer

A)  The equilibrium quantity of wooden desks increases and the equilibrium price falls. 
B)  The equilibrium quantity of wooden desks increases and the equilibrium price rises. 
C)  The equilibrium quantity of wooden desks decreases and the equilibrium price falls. 
D)  The equilibrium quantity of wooden desks decreases and the equilibrium price rises. 
A)  The equilibrium quantity of wooden desks increases and the equilibrium price falls. 
B)  The equilibrium quantity of wooden desks increases and the equilibrium price rises. 
C)  The equilibrium quantity of wooden desks decreases and the equilibrium price falls. 
D)  The equilibrium quantity of wooden desks decreases and the equilibrium price rises.

Question 6

Between 2000 and 2015, advances in PC production technology increased the supply of PCs sharply. The demand for PCs also increased, but not nearly as much as the supply did. As a result, the price of a PC ________ and the quantity of PCs sold ________.

Accepted Answer

A)  rose; decreased 
B)  rose; increased 
C)  fell; decreased 
D)  fell; increased 
A)  rose; decreased 
B)  rose; increased 
C)  fell; decreased 
D)  fell; increased

Question 7

If the demand curve for bottled water shifts leftward and the supply curve of bottled water shifts leftward, the equilibrium

Accepted Answer

A)  price of bottled water definitely increases. 
B)  price of bottled water definitely decreases. 
C)  quantity of bottled water definitely increases. 
D)  quantity of bottled water definitely decreases. 
A)  price of bottled water definitely increases. 
B)  price of bottled water definitely decreases. 
C)  quantity of bottled water definitely increases. 
D)  quantity of bottled water definitely decreases.

Question 8

In mid-2012 Delta increased the price of a New York to LA ticket by 10 percent. As a result of this price hike, there was a ________ shift in the demand curve for a ticket on Continental because the price of a ________ had risen.

Accepted Answer

A)  rightward; complement 
B)  leftward; substitute 
C)  leftward; complement 
D)  rightward; substitute 
A)  rightward; complement 
B)  leftward; substitute 
C)  leftward; complement 
D)  rightward; substitute

Question 9

The price of a tomato increases and people buy more lettuce. You infer that lettuce and tomatoes are

Accepted Answer

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

Question 10

A relative price is the

Accepted Answer

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

Question 11

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

Accepted Answer

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

Question 12

Suppose a medical study reveals new benefits to consuming beef and at the same time a bumper corn crop reduces the cost of feeding steers. The equilibrium price of beef will

Accepted Answer

A)  fall. 
B)  perhaps rise, fall, or stay the same, but more information is needed to determine which it does. 
C)  stay the same. 
D)  rise. 
A)  fall. 
B)  perhaps rise, fall, or stay the same, but more information is needed to determine which it does. 
C)  stay the same. 
D)  rise.

Question 13

The wage rate paid by Walkman producers falls and at the same time the price of raw materials used in the production of Walkmans rises. You predict that the supply curve of Walkmans will

Accepted Answer

A)  shift either leftward or rightward. 
B)  surely shift rightward. 
C)  surely shift leftward. 
D)  surely become steeper. 
A)  shift either leftward or rightward. 
B)  surely shift rightward. 
C)  surely shift leftward. 
D)  surely become steeper.

Question 14

Which of the following influences does NOT shift the supply curve?

Accepted Answer

A)  a rise in the wages paid workers who produce the good 
B)  the development of new technology 
C)  people deciding that they want to buy more of the product 
D)  a decrease in the number of suppliers 
A)  a rise in the wages paid workers who produce the good 
B)  the development of new technology 
C)  people deciding that they want to buy more of the product 
D)  a decrease in the number of suppliers

Question 15

An increase in demand combined with no change in supply

Accepted Answer

A)  raises the equilibrium price. 
B)  lowers the equilibrium price. 
C)  results in only a movement rightward along the demand curve. 
D)  decreases demand because the supply curve does not shift. 
A)  raises the equilibrium price. 
B)  lowers the equilibrium price. 
C)  results in only a movement rightward along the demand curve. 
D)  decreases demand because the supply curve does not shift.

Question 16

There are 72,922 seats in Lambeau Field where the Green Bay Packers play football. The Packers have sold out their season tickets since 1960. There are about 80,000 people on the waiting list to buy season tickets in 2015. This means that at the price in 2015, the

Accepted Answer

A)  quantity demanded of Packer season tickets is 72,922. 
B)  quantity demanded of Packer season tickets is about 80,000. 
C)  quantity demanded of Packer season tickets is about 153,000. 
D)  demand for Packer season tickets is 72,922. 
A)  quantity demanded of Packer season tickets is 72,922. 
B)  quantity demanded of Packer season tickets is about 80,000. 
C)  quantity demanded of Packer season tickets is about 153,000. 
D)  demand for Packer season tickets is 72,922.

Question 17

Which of the following shifts the demand curve for oranges?

Accepted Answer

A)  disastrous weather that destroys about half of this year's orange crop 
B)  a decrease in the price of a pound of bananas, a substitute in consumption for oranges 
C)  an increase in the price of the fuel used to transport oranges to supermarkets 
D)  great weather that produces a bumper orange crop this year 
A)  disastrous weather that destroys about half of this year's orange crop 
B)  a decrease in the price of a pound of bananas, a substitute in consumption for oranges 
C)  an increase in the price of the fuel used to transport oranges to supermarkets 
D)  great weather that produces a bumper orange crop this year

Question 18

-The above figures show the market for gasoline. Which figure shows the effect of motorists increasing the number of times they take the bus to work rather than driving their own cars?

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 19

There are 72,922 seats in Lambeau Field where the Green Bay Packers play football. The Packers have sold out their season tickets since 1960. There were about 70,000 people on the waiting list to buy season tickets in 2010. Packers tickets are a normal good. As a result of the economic recession in 2010 during which people's incomes decreased, the

Accepted Answer

A)  demand for Packers tickets decreased. 
B)  demand curve for Packers tickets shifted rightward. 
C)  quantity demanded of Packers tickets decreased. 
D)  substitution effect changed the quantity demanded. 
A)  demand for Packers tickets decreased. 
B)  demand curve for Packers tickets shifted rightward. 
C)  quantity demanded of Packers tickets decreased. 
D)  substitution effect changed the quantity demanded.

Question 20

If the price per bushel of apples increased from $7.00 to $8.00 because of a poor harvest, the

Accepted Answer

A)  demand for apples decreases. 
B)  quantity of apples demanded decreases. 
C)  quantity of apples supplied decreases. 
D)  Both answers A and B are correct. 
A)  demand for apples decreases. 
B)  quantity of apples demanded decreases. 
C)  quantity of apples supplied decreases. 
D)  Both answers A and B are correct.

What are substitutes in production?

In 2014, the price of peanuts was rising, which lead peanut butter sellers and peanut butter buyers to expect the price of peanut butter would rise in the future. In the current market for peanut butter, the price falls and the quantity decreases. This set of results means that

-The above figures show the market for hamburger meat. Which figure(s) shows the effect of a nation-wide strike by butchers and meat-packers?

In the market for bicycles, explain what happens to the supply and demand curves when there is an increase in the price of steel used to make bikes.

What is the effect on the price and quantity of wooden desks of a rise in the price of wood?

Between 2000 and 2015, advances in PC production technology increased the supply of PCs sharply. The demand for PCs also increased, but not nearly as much as the supply did. As a result, the price of a PC and the quantity of PCs sold .

If the demand curve for bottled water shifts leftward and the supply curve of bottled water shifts leftward, the equilibrium

In mid-2012 Delta increased the price of a New York to LA ticket by 10 percent. As a result of this price hike, there was a shift in the demand curve for a ticket on Continental because the price of a had risen.

The price of a tomato increases and people buy more lettuce. You infer that lettuce and tomatoes are

A relative price is the

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

Suppose a medical study reveals new benefits to consuming beef and at the same time a bumper corn crop reduces the cost of feeding steers. The equilibrium price of beef will

The wage rate paid by Walkman producers falls and at the same time the price of raw materials used in the production of Walkmans rises. You predict that the supply curve of Walkmans will

Which of the following influences does NOT shift the supply curve?

An increase in demand combined with no change in supply

There are 72,922 seats in Lambeau Field where the Green Bay Packers play football. The Packers have sold out their season tickets since 1960. There are about 80,000 people on the waiting list to buy season tickets in 2015. This means that at the price in 2015, the

Which of the following shifts the demand curve for oranges?

-The above figures show the market for gasoline. Which figure shows the effect of motorists increasing the number of times they take the bus to work rather than driving their own cars?

If the price per bushel of apples increased from $7.00 to $8.00 because of a poor harvest, the

What Is Economics

The Economic Problem

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Public Choices, Public Goods, and Healthcare

Externalities

Markets for Factors of Production

Economic Inequality

Uncertainty and Information

Filters

Exam 3: Demand and Supply

What are substitutes in production?

In 2014, the price of peanuts was rising, which lead peanut butter sellers and peanut butter buyers to expect the price of peanut butter would rise in the future. In the current market for peanut butter, the price falls and the quantity decreases. This set of results means that

-The above figures show the market for hamburger meat. Which figure(s) shows the effect of a nation-wide strike by butchers and meat-packers?

In the market for bicycles, explain what happens to the supply and demand curves when there is an increase in the price of steel used to make bikes.

What is the effect on the price and quantity of wooden desks of a rise in the price of wood?

Between 2000 and 2015, advances in PC production technology increased the supply of PCs sharply. The demand for PCs also increased, but not nearly as much as the supply did. As a result, the price of a PC ________ and the quantity of PCs sold ________.

If the demand curve for bottled water shifts leftward and the supply curve of bottled water shifts leftward, the equilibrium

In mid-2012 Delta increased the price of a New York to LA ticket by 10 percent. As a result of this price hike, there was a ________ shift in the demand curve for a ticket on Continental because the price of a ________ had risen.

The price of a tomato increases and people buy more lettuce. You infer that lettuce and tomatoes are

A relative price is the

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

Suppose a medical study reveals new benefits to consuming beef and at the same time a bumper corn crop reduces the cost of feeding steers. The equilibrium price of beef will

The wage rate paid by Walkman producers falls and at the same time the price of raw materials used in the production of Walkmans rises. You predict that the supply curve of Walkmans will

Which of the following influences does NOT shift the supply curve?

An increase in demand combined with no change in supply

There are 72,922 seats in Lambeau Field where the Green Bay Packers play football. The Packers have sold out their season tickets since 1960. There are about 80,000 people on the waiting list to buy season tickets in 2015. This means that at the price in 2015, the

Which of the following shifts the demand curve for oranges?

-The above figures show the market for gasoline. Which figure shows the effect of motorists increasing the number of times they take the bus to work rather than driving their own cars?

If the price per bushel of apples increased from $7.00 to $8.00 because of a poor harvest, the

What Is Economics

The Economic Problem

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Public Choices, Public Goods, and Healthcare

Externalities

Markets for Factors of Production

Economic Inequality

Uncertainty and Information

Filters

Between 2000 and 2015, advances in PC production technology increased the supply of PCs sharply. The demand for PCs also increased, but not nearly as much as the supply did. As a result, the price of a PC and the quantity of PCs sold .

In mid-2012 Delta increased the price of a New York to LA ticket by 10 percent. As a result of this price hike, there was a shift in the demand curve for a ticket on Continental because the price of a had risen.