Question 1

Which of the following raises the equilibrium price and increases the equilibrium quantity of used cars?

Accepted Answer

A)  a fall in income if used cars are an inferior good 
B)  an increase in the wage rate paid to used car salespeople 
C)  neither of the above because the question suggests a violation of the "law of demand" 
D)  neither of the above because the question suggests a violation of the "law of supply" 
A)  a fall in income if used cars are an inferior good 
B)  an increase in the wage rate paid to used car salespeople 
C)  neither of the above because the question suggests a violation of the "law of demand" 
D)  neither of the above because the question suggests a violation of the "law of supply"

Question 2

Between 2000 and 2015, the price of a PC fell and the quantity of PCs sold increased. Which of the explanations below is consistent with these facts?

Accepted Answer

A)  The demand for PCs increased by more then the supply of PCs increased. 
B)  The supply of PCs increased by more than the demand for PCs increased. 
C)  The demand for PCs decreased by more than the supply of PCs increased. 
D)  Both the supply of PCs and the demand for PCs decreased. 
A)  The demand for PCs increased by more then the supply of PCs increased. 
B)  The supply of PCs increased by more than the demand for PCs increased. 
C)  The demand for PCs decreased by more than the supply of PCs increased. 
D)  Both the supply of PCs and the demand for PCs decreased.

Question 3

If the demand curve for bottled water shifts rightward and the supply curve of bottled water shifts rightward, 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 4

The relative price of a good is greater than the money price of a good.

Accepted Answer

A) True 
 B)False

Question 5

When demand increases, the equilibrium price ________ and the equilibrium quantity ________.

Accepted Answer

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

Question 6

What will happen to the equilibrium price and quantity of coffee if it is discovered to help prevent colds and, at the same time, Brazil and Vietnam emerge in the global market as massive producers of coffee?

Accepted Answer

A)  The price will fall and the effect on the quantity is uncertain. 
B)  The quantity will increase and the effect on the price is uncertain. 
C)  The quantity will decrease and the price will rise. 
D)  The quantity will increase and the price will remain unchanged. 
A)  The price will fall and the effect on the quantity is uncertain. 
B)  The quantity will increase and the effect on the price is uncertain. 
C)  The quantity will decrease and the price will rise. 
D)  The quantity will increase and the price will remain unchanged.

Question 7

For consumers, chocolate chip cookies and doughnuts are substitutes. So, an increase in the price of chocolate chip cookies will lead to a rightward shift in the demand curve for doughnuts.

Accepted Answer

A) True 
 B)False

Question 8

Bicycles are made out of steel. If the price of steel increases, there is a shift in the supply curve of bicycles that leads to

Accepted Answer

A)  a shift in the demand curve for bicycles. 
B)  a temporary surplus of bicycles. 
C)  a permanent surplus of bicycles. 
D)  an increase in the price of a bicycle. 
A)  a shift in the demand curve for bicycles. 
B)  a temporary surplus of bicycles. 
C)  a permanent surplus of bicycles. 
D)  an increase in the price of a bicycle.

Question 9

A change in which of the following shifts the demand curve?

Accepted Answer

A)  the number of sellers in the market 
B)  the price of the resources used to produce the product 
C)  the technology with which the product is produced 
D)  the tastes and preferences of consumers 
A)  the number of sellers in the market 
B)  the price of the resources used to produce the product 
C)  the technology with which the product is produced 
D)  the tastes and preferences of consumers

Question 10

An increase in the price of jet fuel will ________ airline travel and the equilibrium quantity of airline travel will ________.

Accepted Answer

A)  decrease the supply of; decrease 
B)  increase the demand for; increase 
C)  decrease the supply of; increase 
D)  decrease the demand for; decrease 
A)  decrease the supply of; decrease 
B)  increase the demand for; increase 
C)  decrease the supply of; increase 
D)  decrease the demand for; decrease

Question 11

Each point on a supply curve represents

Accepted Answer

A)  the highest price buyers will pay for the good. 
B)  the lowest price for which a supplier can profitably sell another unit. 
C)  the lowest price buyers will accept per unit of the good. 
D)  the highest price sellers can get for each unit over time. 
A)  the highest price buyers will pay for the good. 
B)  the lowest price for which a supplier can profitably sell another unit. 
C)  the lowest price buyers will accept per unit of the good. 
D)  the highest price sellers can get for each unit over time.

Question 12

Which of the following best reflects an increase in quantity demanded and NOT an increase in demand?

Accepted Answer

A)  A college expects enrollment to increase, despite no change in the tuition. 
B)  Skiing becomes a fashionable winter sports activity. 
C)  The price of hair stylings falls. 
D)  Consumers expect lower prices next month for computers. 
A)  A college expects enrollment to increase, despite no change in the tuition. 
B)  Skiing becomes a fashionable winter sports activity. 
C)  The price of hair stylings falls. 
D)  Consumers expect lower prices next month for computers.

Question 13

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

Accepted Answer

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

Question 14

Which of the following explains why supply curves slope upward?

Accepted Answer

A)  prices and income 
B)  increasing marginal cost 
C)  resources and technology 
D)  substitutes in production and complements in production 
A)  prices and income 
B)  increasing marginal cost 
C)  resources and technology 
D)  substitutes in production and complements in production

Question 15

-Suppose the market for Blu-rays has the demand and supply schedules shown in the table above. What is the equilibrium price and the equilibrium quantity in this market?
Suppose the current price is $12.00. What is the quantity of Blu-rays sold? Explain. Is there a shortage or a surplus? How big is it? Explain.

Accepted Answer

The equilibrium price is $11.50. The equ

Question 16

Which of the following always raises the equilibrium price?

Accepted Answer

A)  an increase in both demand and supply 
B)  a decrease in both demand and supply 
C)  an increase in demand combined with a decrease in supply 
D)  a decrease in demand combined with an increase in supply 
A)  an increase in both demand and supply 
B)  a decrease in both demand and supply 
C)  an increase in demand combined with a decrease in supply 
D)  a decrease in demand combined with an increase in supply

Question 17

A fall in the price of a good causes producers to reduce the quantity of the good they are willing to produce. This fact illustrates

Accepted Answer

A)  the law of supply. 
B)  the law of demand. 
C)  a change in supply. 
D)  the nature of an inferior good. 
A)  the law of supply. 
B)  the law of demand. 
C)  a change in supply. 
D)  the nature of an inferior good.

Question 18

As the price of a pound of peanuts falls, the

Accepted Answer

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

Question 19

Which of the following results in a movement along the supply curve of spinach but does NOT shift the supply curve of spinach?

Accepted Answer

A)  disastrous weather that destroys half of this year's spinach crop 
B)  a rise in the price of spinach 
C)  an increase in wages for workers in spinach fields 
D)  great weather that produces a bumper spinach crop this year 
A)  disastrous weather that destroys half of this year's spinach crop 
B)  a rise in the price of spinach 
C)  an increase in wages for workers in spinach fields 
D)  great weather that produces a bumper spinach crop this year

Question 20

The demand for a good increases when the price of a substitute ________ and also increases when the price of a complement ________.

Accepted Answer

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

Which of the following raises the equilibrium price and increases the equilibrium quantity of used cars?

Between 2000 and 2015, the price of a PC fell and the quantity of PCs sold increased. Which of the explanations below is consistent with these facts?

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

The relative price of a good is greater than the money price of a good.

When demand increases, the equilibrium price and the equilibrium quantity .

What will happen to the equilibrium price and quantity of coffee if it is discovered to help prevent colds and, at the same time, Brazil and Vietnam emerge in the global market as massive producers of coffee?

For consumers, chocolate chip cookies and doughnuts are substitutes. So, an increase in the price of chocolate chip cookies will lead to a rightward shift in the demand curve for doughnuts.

Bicycles are made out of steel. If the price of steel increases, there is a shift in the supply curve of bicycles that leads to

A change in which of the following shifts the demand curve?

An increase in the price of jet fuel will airline travel and the equilibrium quantity of airline travel will .

Each point on a supply curve represents

Which of the following best reflects an increase in quantity demanded and NOT an increase in demand?

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

Which of the following explains why supply curves slope upward?

Which of the following always raises the equilibrium price?

A fall in the price of a good causes producers to reduce the quantity of the good they are willing to produce. This fact illustrates

As the price of a pound of peanuts falls, the

Which of the following results in a movement along the supply curve of spinach but does NOT shift the supply curve of spinach?

The demand for a good increases when the price of a substitute and also increases when the price of a complement .

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

Which of the following raises the equilibrium price and increases the equilibrium quantity of used cars?

Between 2000 and 2015, the price of a PC fell and the quantity of PCs sold increased. Which of the explanations below is consistent with these facts?

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

The relative price of a good is greater than the money price of a good.

When demand increases, the equilibrium price ________ and the equilibrium quantity ________.

What will happen to the equilibrium price and quantity of coffee if it is discovered to help prevent colds and, at the same time, Brazil and Vietnam emerge in the global market as massive producers of coffee?

For consumers, chocolate chip cookies and doughnuts are substitutes. So, an increase in the price of chocolate chip cookies will lead to a rightward shift in the demand curve for doughnuts.

Bicycles are made out of steel. If the price of steel increases, there is a shift in the supply curve of bicycles that leads to

A change in which of the following shifts the demand curve?

An increase in the price of jet fuel will ________ airline travel and the equilibrium quantity of airline travel will ________.

Each point on a supply curve represents

Which of the following best reflects an increase in quantity demanded and NOT an increase in demand?

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

Which of the following explains why supply curves slope upward?

Which of the following always raises the equilibrium price?

A fall in the price of a good causes producers to reduce the quantity of the good they are willing to produce. This fact illustrates

As the price of a pound of peanuts falls, the

Which of the following results in a movement along the supply curve of spinach but does NOT shift the supply curve of spinach?

The demand for a good increases when the price of a substitute ________ and also increases when the price of a complement ________.

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

When demand increases, the equilibrium price and the equilibrium quantity .

An increase in the price of jet fuel will airline travel and the equilibrium quantity of airline travel will .

The demand for a good increases when the price of a substitute and also increases when the price of a complement .