Question 1

-The above figure shows the market for pizza. Which figure shows the effect of a decrease in the price of a hamburger, which for consumers is a substitute for pizza?

Accepted Answer

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

Question 2

A bakery can produce either cakes or cookies. If the price of cookies rises, then

Accepted Answer

A)  the supply curve of cake shifts leftward. 
B)  the supply curve of cake shifts rightward. 
C)  there is a movement downward along the supply curve of cakes. 
D)  there is a movement upward along the supply curve of cakes. 
A)  the supply curve of cake shifts leftward. 
B)  the supply curve of cake shifts rightward. 
C)  there is a movement downward along the supply curve of cakes. 
D)  there is a movement upward along the supply curve of cakes.

Question 3

The Market for Wapanzo Beans
Quantity Demanded Price Quantity Supplied
(millions of pounds (dollars per (millions of pounds
per year) pound) per year)
  
-Refer to the table above. Suppose that in normal years demand is represented by Case 2 and supply is represented by Case B. In a normal year the equilibrium quantity of wapanzo beans will be

Accepted Answer

A)  2 million pounds. 
B)  4 million pounds. 
C)  6 million pounds. 
D)  8 million pounds. 
A)  2 million pounds. 
B)  4 million pounds. 
C)  6 million pounds. 
D)  8 million pounds.

Question 4

Explain the difference between a change in demand and a change in quantity demanded. What leads to each of these changes?

Accepted Answer

A change in demand occurs when consumers

Question 5

Normal goods are those for which demand decreases as

Accepted Answer

A)  the price of a complement falls. 
B)  the price of a substitute falls. 
C)  income decreases. 
D)  the good's own price rises. 
A)  the price of a complement falls. 
B)  the price of a substitute falls. 
C)  income decreases. 
D)  the good's own price rises.

Question 6

-The above table shows the demand schedule and supply schedule for chocolate chip cookies. If the price is $4.00 per pound, there is a

Accepted Answer

A)  shortage of 2 pounds of chocolate chip cookies. 
B)  shortage of 3 pounds of chocolate chip cookies. 
C)  shortage of 5 pounds of chocolate chip cookies. 
D)  surplus of 3 pounds of chocolate chip cookies. 
A)  shortage of 2 pounds of chocolate chip cookies. 
B)  shortage of 3 pounds of chocolate chip cookies. 
C)  shortage of 5 pounds of chocolate chip cookies. 
D)  surplus of 3 pounds of chocolate chip cookies.

Question 7

If the price of chocolate chip cookies falls, then

Accepted Answer

A)  the supply curve of chocolate chip cookies shifts rightward. 
B)  the supply curve of chocolate chip cookies shifts leftward. 
C)  there is a movement downward along the supply curve of chocolate chip cookies. 
D)  there is a movement upward along the supply curve of chocolate chip cookies. 
A)  the supply curve of chocolate chip cookies shifts rightward. 
B)  the supply curve of chocolate chip cookies shifts leftward. 
C)  there is a movement downward along the supply curve of chocolate chip cookies. 
D)  there is a movement upward along the supply curve of chocolate chip cookies.

Question 8

-The above figures show the market for hamburger meat. Which figure(s) shows the effect of an increase in the price of a hamburger bun, a complement for hamburger meat?

Accepted Answer

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

Question 9

-The above figure shows the market for gasoline. When a hurricane destroys a major refinery that refines oil into gasoline, the

Accepted Answer

A)  demand curve for gasoline shifts from D1 to D2 and the supply curve of gasoline does not shift. 
B)  demand curve for gasoline shifts from D1 to D2 and the supply curve of gasoline shifts from S2 to S1. 
C)  demand curve for gasoline does not shift, and the supply curve of gasoline shifts from S2 to S1. 
D)  demand curve for gasoline does not shift, and the supply curve of gasoline shifts from S1 to S2. 
A)  demand curve for gasoline shifts from D1 to D2 and the supply curve of gasoline does not shift. 
B)  demand curve for gasoline shifts from D1 to D2 and the supply curve of gasoline shifts from S2 to S1. 
C)  demand curve for gasoline does not shift, and the supply curve of gasoline shifts from S2 to S1. 
D)  demand curve for gasoline does not shift, and the supply curve of gasoline shifts from S1 to S2.

Question 10

-The above figures show the market for hamburger meat. Which figure(s) shows the effect of an increase in the price of a substitute like hot dogs?

Accepted Answer

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

Question 11

-The above figures show the market for oranges. Which figure(s) shows the effect of a new government program that provides each public school child with an orange to start the day?

Accepted Answer

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

Question 12

The "law of supply" states that, other things remaining the same, firms produce

Accepted Answer

A)  more of a good the less it costs to produce it. 
B)  less of a good the more it costs to produce it. 
C)  more of a good the higher its price. 
D)  less of a good as the required resources become scarcer. 
A)  more of a good the less it costs to produce it. 
B)  less of a good the more it costs to produce it. 
C)  more of a good the higher its price. 
D)  less of a good as the required resources become scarcer.

Question 13

When there is a shortage in the market, the quantity sold is

Accepted Answer

A)  greater than the quantity supplied. 
B)  equal to the quantity supplied. 
C)  less than the quantity supplied. 
D)  less than the quantity bought. 
A)  greater than the quantity supplied. 
B)  equal to the quantity supplied. 
C)  less than the quantity supplied. 
D)  less than the quantity bought.

Question 14

-The above figures show the market for hamburger meat. Which figure shows the effect when more farmers decide to raise cows that are processed into hamburger meat?

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 15

If the demand and supply curves are described by the following equations P = a - bQ and P = c + dQ, respectively, the equilibrium price is P* = (ad + bc) / (b + d).

Accepted Answer

A) True 
 B)False

Question 16

The equilibrium price will fall and the equilibrium quantity might increase, decrease, or stay the same when the

Accepted Answer

A)  demand and the supply of a good both increase. 
B)  demand for a good increases and the supply of it decreases. 
C)  demand for a good decreases and the supply of it increases. 
D)  demand and the supply of a good both decrease. 
A)  demand and the supply of a good both increase. 
B)  demand for a good increases and the supply of it decreases. 
C)  demand for a good decreases and the supply of it increases. 
D)  demand and the supply of a good both decrease.

Question 17

Which of the following increases the supply of a product?

Accepted Answer

A)  a fall in the price of the product 
B)  a smaller number of sellers producing the product 
C)  an increase in foreign imports of the product 
D)  higher taxes imposed upon producers of the product 
A)  a fall in the price of the product 
B)  a smaller number of sellers producing the product 
C)  an increase in foreign imports of the product 
D)  higher taxes imposed upon producers of the product

Question 18

If there exists a shortage in the market for snowmobiles, then the price of a snowmobile will

Accepted Answer

A)  rise. 
B)  fall. 
C)  neither rise nor fall. 
D)  at first fall then rise. 
A)  rise. 
B)  fall. 
C)  neither rise nor fall. 
D)  at first fall then rise.

Question 19

When the price is less than the equilibrium price

Accepted Answer

A)  there will be a shortage. 
B)  some consumers will be willing to pay a price higher than the prevailing price. 
C)  the price will be forced higher. 
D)  All of the above answers are correct. 
A)  there will be a shortage. 
B)  some consumers will be willing to pay a price higher than the prevailing price. 
C)  the price will be forced higher. 
D)  All of the above answers are correct.

Question 20

Producers of DVDs are able to lower the wage rate that they pay to their workers. You predict that the

Accepted Answer

A)  price will rise. 
B)  quantity supplied will decrease. 
C)  supply curve will shift leftward. 
D)  supply curve will shift rightward. 
A)  price will rise. 
B)  quantity supplied will decrease. 
C)  supply curve will shift leftward. 
D)  supply curve will shift rightward.

-The above figure shows the market for pizza. Which figure shows the effect of a decrease in the price of a hamburger, which for consumers is a substitute for pizza?

A bakery can produce either cakes or cookies. If the price of cookies rises, then

Explain the difference between a change in demand and a change in quantity demanded. What leads to each of these changes?

Normal goods are those for which demand decreases as

-The above table shows the demand schedule and supply schedule for chocolate chip cookies. If the price is $4.00 per pound, there is a

If the price of chocolate chip cookies falls, then

-The above figures show the market for hamburger meat. Which figure(s) shows the effect of an increase in the price of a hamburger bun, a complement for hamburger meat?

-The above figure shows the market for gasoline. When a hurricane destroys a major refinery that refines oil into gasoline, the

-The above figures show the market for hamburger meat. Which figure(s) shows the effect of an increase in the price of a substitute like hot dogs?

-The above figures show the market for oranges. Which figure(s) shows the effect of a new government program that provides each public school child with an orange to start the day?

The "law of supply" states that, other things remaining the same, firms produce

When there is a shortage in the market, the quantity sold is

-The above figures show the market for hamburger meat. Which figure shows the effect when more farmers decide to raise cows that are processed into hamburger meat?

If the demand and supply curves are described by the following equations P = a - bQ and P = c + dQ, respectively, the equilibrium price is P* = (ad + bc) / (b + d).

The equilibrium price will fall and the equilibrium quantity might increase, decrease, or stay the same when the

Which of the following increases the supply of a product?

If there exists a shortage in the market for snowmobiles, then the price of a snowmobile will

When the price is less than the equilibrium price

Producers of DVDs are able to lower the wage rate that they pay to their workers. You predict that 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

-The above figure shows the market for pizza. Which figure shows the effect of a decrease in the price of a hamburger, which for consumers is a substitute for pizza?

A bakery can produce either cakes or cookies. If the price of cookies rises, then

Explain the difference between a change in demand and a change in quantity demanded. What leads to each of these changes?

Normal goods are those for which demand decreases as

-The above table shows the demand schedule and supply schedule for chocolate chip cookies. If the price is $4.00 per pound, there is a

If the price of chocolate chip cookies falls, then

-The above figures show the market for hamburger meat. Which figure(s) shows the effect of an increase in the price of a hamburger bun, a complement for hamburger meat?

-The above figure shows the market for gasoline. When a hurricane destroys a major refinery that refines oil into gasoline, the

-The above figures show the market for hamburger meat. Which figure(s) shows the effect of an increase in the price of a substitute like hot dogs?

-The above figures show the market for oranges. Which figure(s) shows the effect of a new government program that provides each public school child with an orange to start the day?

The "law of supply" states that, other things remaining the same, firms produce

When there is a shortage in the market, the quantity sold is

-The above figures show the market for hamburger meat. Which figure shows the effect when more farmers decide to raise cows that are processed into hamburger meat?

If the demand and supply curves are described by the following equations P = a - bQ and P = c + dQ, respectively, the equilibrium price is P* = (ad + bc) / (b + d).

The equilibrium price will fall and the equilibrium quantity might increase, decrease, or stay the same when the

Which of the following increases the supply of a product?

If there exists a shortage in the market for snowmobiles, then the price of a snowmobile will

When the price is less than the equilibrium price

Producers of DVDs are able to lower the wage rate that they pay to their workers. You predict that 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