Question 1

Which of the following statements is CORRECT?

Accepted Answer

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

Question 2

Which of the following shifts the supply curve for good X leftward?

Accepted Answer

A)  a situation in which quantity demanded exceeds quantity supplied 
B)  an increase in the cost of the machinery used to produce X 
C)  a technological advance in the production of X 
D)  a decrease in the wages of workers employed to produce X 
A)  a situation in which quantity demanded exceeds quantity supplied 
B)  an increase in the cost of the machinery used to produce X 
C)  a technological advance in the production of X 
D)  a decrease in the wages of workers employed to produce X

Question 3

If the price of lumber rises, then, in the market for sawdust

Accepted Answer

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

Question 4

-In the above figure, what is the minimum supply price for the fourth gallon of ice cream?

Accepted Answer

A)  $2.00 
B)  $3.00 
C)  $4.00 
D)  $5.00 
A)  $2.00 
B)  $3.00 
C)  $4.00 
D)  $5.00

Question 5

Young drivers often buy used cars. An increase in the legal driving age to twenty-one shifts the demand curve for used cars leftward, whereas lowering the age to fifteen shifts the demand curve rightward.

Accepted Answer

A) True 
 B)False

Question 6

A supply curve is also a maximum-supply-price curve.

Accepted Answer

A) True 
 B)False

Question 7

-The above figure shows the market for hamburger. Which panel shows the effect of a new excise tax on all beef products?

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 8

The price of a gallon of milk falls. Which of the following is a possible cause?

Accepted Answer

A)  a decrease in the price of oatmeal, a complement to milk 
B)  a discovery that milk cause diabetes 
C)  Milk is a normal good and people's incomes rise. 
D)  a drought that reduces supplies of feed grains fed to cows that produce milk 
A)  a decrease in the price of oatmeal, a complement to milk 
B)  a discovery that milk cause diabetes 
C)  Milk is a normal good and people's incomes rise. 
D)  a drought that reduces supplies of feed grains fed to cows that produce milk

Question 9

A relative price is the product of two money prices.

Accepted Answer

A) True 
 B)False

Question 10

Changes in which of the following shifts the supply curve of hamburgers?

Accepted Answer

A)  a rise in the price of soda, a complement for hamburgers 
B)  new research that establishes a link between hamburgers and heart problems 
C)  an increase in the price of meat used to produce hamburgers 
D)  an economy-wide decrease in income because of a long recession 
A)  a rise in the price of soda, a complement for hamburgers 
B)  new research that establishes a link between hamburgers and heart problems 
C)  an increase in the price of meat used to produce hamburgers 
D)  an economy-wide decrease in income because of a long recession

Question 11

When people's incomes increase, the demand for a good increases. The good is called

Accepted Answer

A)  an inferior good. 
B)  a complement. 
C)  a substitute. 
D)  a normal good. 
A)  an inferior good. 
B)  a complement. 
C)  a substitute. 
D)  a normal good.

Question 12

-The above figures show the market for gasoline. Which figure shows the effect of the end of a nine month strike by workers at all U.S. oil refineries?

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 13

If income decreases or the price of a complement rises

Accepted Answer

A)  the demand curve for a normal good shifts leftward. 
B)  the demand curve for a normal good shifts rightward. 
C)  there is an upward movement along the demand curve for the good. 
D)  there is a downward movement along the demand curve for the good. 
A)  the demand curve for a normal good shifts leftward. 
B)  the demand curve for a normal good shifts rightward. 
C)  there is an upward movement along the demand curve for the good. 
D)  there is a downward movement along the demand curve for the good.

Question 14

-The above table gives the demand and supply schedules for cat food. If the price is $3.00 per pound of cat food, will there be a shortage, a surplus, or is this price the equilibrium price? If there is a shortage, how much is the shortage? If there is a surplus, how much is the surplus? If $3.00 is the equilibrium price, what is the equilibrium quantity?

Accepted Answer

At a price of $3.00 per pound

Question 15

The money price of a pizza is $12 per pizza and the money price of a taco is $2 per taco. The relative price of a pizza is

Accepted Answer

A)  $12 per pizza. 
B)  $24 per pizza. 
C)  6 tacos per pizza. 
D)  1/6 pizza per taco. 
A)  $12 per pizza. 
B)  $24 per pizza. 
C)  6 tacos per pizza. 
D)  1/6 pizza per taco.

Question 16

-The above figure shows the market for french fries at fast food joints. If the price of potatoes rises and simultaneously people become concerned that french fries can cause heart attacks the

Accepted Answer

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

Question 17

-In the above figure, an increase in the quantity demanded is represented by a movement from point d to

Accepted Answer

A)  point b only. 
B)  point c only. 
C)  point a. 
D)  both points b and c. 
A)  point b only. 
B)  point c only. 
C)  point a. 
D)  both points b and c.

Question 18

-In the figure, the equilibrium price is initially $3 per bushel of wheat. If suppliers come to expect that the price of a bushel of wheat will rise in the future, but buyers do not, the current equilibrium price will

Accepted Answer

A)  rise. 
B)  not change. 
C)  fall. 
D)  Perhaps rise, fall, or stay the same, depending on whether there are more demanders or suppliers in the market. 
A)  rise. 
B)  not change. 
C)  fall. 
D)  Perhaps rise, fall, or stay the same, depending on whether there are more demanders or suppliers in the market.

Question 19

When does a surplus occur?

Accepted Answer

A surplus occurs when the pric

Question 20

If consumers but not producers expect that the price of soda will rise in November, the

Accepted Answer

A)  supply of soda in October will increase. 
B)  demand for soda in October will decrease. 
C)  demand for soda in October will increase. 
D)  supply of soda in October will decrease. 
A)  supply of soda in October will increase. 
B)  demand for soda in October will decrease. 
C)  demand for soda in October will increase. 
D)  supply of soda in October will decrease.

Which of the following statements is CORRECT?

Which of the following shifts the supply curve for good X leftward?

If the price of lumber rises, then, in the market for sawdust

-In the above figure, what is the minimum supply price for the fourth gallon of ice cream?

Young drivers often buy used cars. An increase in the legal driving age to twenty-one shifts the demand curve for used cars leftward, whereas lowering the age to fifteen shifts the demand curve rightward.

A supply curve is also a maximum-supply-price curve.

-The above figure shows the market for hamburger. Which panel shows the effect of a new excise tax on all beef products?

The price of a gallon of milk falls. Which of the following is a possible cause?

A relative price is the product of two money prices.

Changes in which of the following shifts the supply curve of hamburgers?

When people's incomes increase, the demand for a good increases. The good is called

-The above figures show the market for gasoline. Which figure shows the effect of the end of a nine month strike by workers at all U.S. oil refineries?

If income decreases or the price of a complement rises

The money price of a pizza is $12 per pizza and the money price of a taco is $2 per taco. The relative price of a pizza is

-The above figure shows the market for french fries at fast food joints. If the price of potatoes rises and simultaneously people become concerned that french fries can cause heart attacks the

-In the above figure, an increase in the quantity demanded is represented by a movement from point d to

-In the figure, the equilibrium price is initially $3 per bushel of wheat. If suppliers come to expect that the price of a bushel of wheat will rise in the future, but buyers do not, the current equilibrium price will

When does a surplus occur?

If consumers but not producers expect that the price of soda will rise in November, 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

Which of the following statements is CORRECT?

Which of the following shifts the supply curve for good X leftward?

If the price of lumber rises, then, in the market for sawdust

-In the above figure, what is the minimum supply price for the fourth gallon of ice cream?

Young drivers often buy used cars. An increase in the legal driving age to twenty-one shifts the demand curve for used cars leftward, whereas lowering the age to fifteen shifts the demand curve rightward.

A supply curve is also a maximum-supply-price curve.

-The above figure shows the market for hamburger. Which panel shows the effect of a new excise tax on all beef products?

The price of a gallon of milk falls. Which of the following is a possible cause?

A relative price is the product of two money prices.

Changes in which of the following shifts the supply curve of hamburgers?

When people's incomes increase, the demand for a good increases. The good is called

-The above figures show the market for gasoline. Which figure shows the effect of the end of a nine month strike by workers at all U.S. oil refineries?

If income decreases or the price of a complement rises

The money price of a pizza is $12 per pizza and the money price of a taco is $2 per taco. The relative price of a pizza is

-The above figure shows the market for french fries at fast food joints. If the price of potatoes rises and simultaneously people become concerned that french fries can cause heart attacks the

-In the above figure, an increase in the quantity demanded is represented by a movement from point d to

-In the figure, the equilibrium price is initially $3 per bushel of wheat. If suppliers come to expect that the price of a bushel of wheat will rise in the future, but buyers do not, the current equilibrium price will

When does a surplus occur?

If consumers but not producers expect that the price of soda will rise in November, 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