Question 1

A change in the income of buyers will normally change demand.

Accepted Answer

A) True 
 B)False

Question 2

Supply can shift due to changes in price.

Accepted Answer

A) True 
 B)False

Question 3

Why do price ceilings tend to cause persistent imbalances in the market?

Accepted Answer

A) Quantity demanded exceeds quantity supplied but price cannot rise to remove the shortage. 
B) Quantity demanded exceeds quantity supplied but price cannot fall to remove the surplus. 
C) Quantity supplied exceeds quantity demanded but price cannot rise to remove the shortage. 
D) Quantity supplied exceeds quantity demanded but price cannot fall to remove the surplus. 
A) Quantity demanded exceeds quantity supplied but price cannot rise to remove the shortage. 
B) Quantity demanded exceeds quantity supplied but price cannot fall to remove the surplus. 
C) Quantity supplied exceeds quantity demanded but price cannot rise to remove the shortage. 
D) Quantity supplied exceeds quantity demanded but price cannot fall to remove the surplus.

Question 4

Figure 4-4  
-In Figure 4-4, an increase in population will change demand from

Accepted Answer

A) D1 to D2. 
B) D2 to D1. 
C) D3 to D2. 
D) D3 to D1. 
A) D1 to D2. 
B) D2 to D1. 
C) D3 to D2. 
D) D3 to D1.

Question 5

A decrease in the price of VCRs will increase demand for video cassettes.

Accepted Answer

A) True 
 B)False

Question 6

Professional baseball teams in the United States use only wooden bats.If aluminum bats were permitted, the likely result would be a

Accepted Answer

A) shift in the supply curve for aluminum bats. 
B) shift in the supply curve for wooden bats. 
C) change in the quantity supplied of aluminum bats. 
D) persistent shortage of aluminum bats. 
A) shift in the supply curve for aluminum bats. 
B) shift in the supply curve for wooden bats. 
C) change in the quantity supplied of aluminum bats. 
D) persistent shortage of aluminum bats.

Question 7

When the price of a good increases, it

Accepted Answer

A) leads suppliers to place few goods on the market. 
B) the demand for the good shifts. 
C) leads consumers to want to buy more or less than before at a given price. 
D) a movement down along the demand curve will occur. 
A) leads suppliers to place few goods on the market. 
B) the demand for the good shifts. 
C) leads consumers to want to buy more or less than before at a given price. 
D) a movement down along the demand curve will occur.

Question 8

Sugarcane can be used to produce both granulated sugar and ethanol.Recent regulations in certain countries now permit a higher amount of ethanol to be added to gasoline.An economist would expect sugarcane prices to ____, and quantity sold to ____.

Accepted Answer

A) rise; rise. 
B) fall; fall. 
C) rise; fall. 
D) fall; remain the same. 
A) rise; rise. 
B) fall; fall. 
C) rise; fall. 
D) fall; remain the same.

Question 9

Sugarcane can be used to produce both granulated sugar and ethanol.Recent regulations in certain countries now permit a higher amount of ethanol to be added to gasoline.As a result of these changes, an economist would expect granulated sugar prices to ____, and quantity sold to ____.

Accepted Answer

A) rise; rise. 
B) fall; fall. 
C) rise; fall. 
D) fall; remain the same. 
A) rise; rise. 
B) fall; fall. 
C) rise; fall. 
D) fall; remain the same.

Question 10

Demand shifts due to changes in price.

Accepted Answer

A) True 
 B)False

Question 11

The supply curve shows

Accepted Answer

A) the same basic information as the demand curve. 
B) who will have an opportunity to produce or purchase an item. 
C) the quantity produced as a function of the price. 
D) plots of what quantities have been sold over the past few weeks or months. 
A) the same basic information as the demand curve. 
B) who will have an opportunity to produce or purchase an item. 
C) the quantity produced as a function of the price. 
D) plots of what quantities have been sold over the past few weeks or months.

Question 12

An increase in consumer income will shift both the supply and demand curves.

Accepted Answer

A) True 
 B)False

Question 13

The quantity of newspapers sold will decline if

Accepted Answer

A) newsprint becomes more expensive. 
B) the printers' union makes wage concessions. 
C) prices are reduced. 
D) magazine prices rise. 
A) newsprint becomes more expensive. 
B) the printers' union makes wage concessions. 
C) prices are reduced. 
D) magazine prices rise.

Question 14

If the price of chicken rises from $1.25 per pound to $1.75 per pound, if the demand curve is consistent with the law of demand, then the quantity of chicken demanded would be predicted to go from

Accepted Answer

A) 100 pounds to 125 pounds per day. 
B) 100 pounds to 75 pounds per day. 
C) 100 pounds to 100 pounds per day, because the price of chicken does not affect the quantity demanded. 
D) 100 pounds to 0 pounds per day, because consumers would stop purchasing chicken at a price above $1.25 per pound. 
A) 100 pounds to 125 pounds per day. 
B) 100 pounds to 75 pounds per day. 
C) 100 pounds to 100 pounds per day, because the price of chicken does not affect the quantity demanded. 
D) 100 pounds to 0 pounds per day, because consumers would stop purchasing chicken at a price above $1.25 per pound.

Question 15

Scalpers (people selling tickets at a price above the stated price, P*) were spotted at this year's Super Bowl game.This suggest that

Accepted Answer

A) P* is less than the equilibrium price. 
B) P* is greater than the equilibrium price. 
C) P* is the equilibrium price. 
D) it's not possible to determine anything about the equilibrium price with this information. 
A) P* is less than the equilibrium price. 
B) P* is greater than the equilibrium price. 
C) P* is the equilibrium price. 
D) it's not possible to determine anything about the equilibrium price with this information.

Question 16

At an equilibrium price for gasoline,

Accepted Answer

A) everyone who is willing and able to purchase gasoline at that price can do so. 
B) surpluses are inevitable. 
C) market forces will eventually change the quantities demanded and supplied. 
D) suppliers must be using the most efficient oil-drilling equipment available. 
A) everyone who is willing and able to purchase gasoline at that price can do so. 
B) surpluses are inevitable. 
C) market forces will eventually change the quantities demanded and supplied. 
D) suppliers must be using the most efficient oil-drilling equipment available.

Question 17

Which of the following is an example of the effect of a price floor?

Accepted Answer

A) Scalping of Super Bowl tickets 
B) Surplus cheese 
C) The New York city housing shortage 
D) Black markets 
E) Milk shortages 
A) Scalping of Super Bowl tickets 
B) Surplus cheese 
C) The New York city housing shortage 
D) Black markets 
E) Milk shortages

Question 18

The price of coal fell and the quantity sold also fell.Everything else being equal, it is consistent that

Accepted Answer

A) the price of oil fell. 
B) coal miners received large wage increases. 
C) more efficient mining equipment was installed. 
D) consumer incomes rose. 
E) the supply of coal fell. 
A) the price of oil fell. 
B) coal miners received large wage increases. 
C) more efficient mining equipment was installed. 
D) consumer incomes rose. 
E) the supply of coal fell.

Question 19

-As the general population has aged, there has been an increase in the number of nursing homes, community health facilities along with the development of home care facilities.All of these factors have produced an increase in the demand for nurses.Simultaneously, improved job opportunities for women other fields have reduced the supply of nurses.Despite these factors, hospitals, the major employers of nurses, have resisted wage increases.The resulting situation can be described as

Accepted Answer

A) a cost disease in the service sector. 
B) a shortage of nurses. 
C) the problem of auxiliary restrictions. 
D) a wage floor problem. 
A) a cost disease in the service sector. 
B) a shortage of nurses. 
C) the problem of auxiliary restrictions. 
D) a wage floor problem.

Question 20

Equilibrium price and quantity are determined by the intersection of the demand and supply curves.

Accepted Answer

A) True 
 B)False

Exam 4: Supply and Demand: an Initial Look

A change in the income of buyers will normally change demand.

Supply can shift due to changes in price.

Why do price ceilings tend to cause persistent imbalances in the market?

Figure 4-4 -In Figure 4-4, an increase in population will change demand from

A decrease in the price of VCRs will increase demand for video cassettes.

Professional baseball teams in the United States use only wooden bats.If aluminum bats were permitted, the likely result would be a

When the price of a good increases, it

Sugarcane can be used to produce both granulated sugar and ethanol.Recent regulations in certain countries now permit a higher amount of ethanol to be added to gasoline.An economist would expect sugarcane prices to ____, and quantity sold to ____.

Sugarcane can be used to produce both granulated sugar and ethanol.Recent regulations in certain countries now permit a higher amount of ethanol to be added to gasoline.As a result of these changes, an economist would expect granulated sugar prices to ____, and quantity sold to ____.

Demand shifts due to changes in price.

The supply curve shows

An increase in consumer income will shift both the supply and demand curves.

The quantity of newspapers sold will decline if

If the price of chicken rises from $1.25 per pound to $1.75 per pound, if the demand curve is consistent with the law of demand, then the quantity of chicken demanded would be predicted to go from

Scalpers (people selling tickets at a price above the stated price, P*) were spotted at this year's Super Bowl game.This suggest that

At an equilibrium price for gasoline,

Which of the following is an example of the effect of a price floor?

The price of coal fell and the quantity sold also fell.Everything else being equal, it is consistent that

Equilibrium price and quantity are determined by the intersection of the demand and supply curves.

What Is Economics

The Economony: Myth and Reality

The Fundamental Economic Problem: Scarcity and Choice

Consumer Choice: Individual and Market Demand

Demand and Elasticity

Production, Inputs, and Cost: Building Blocks for Supply Analysis

Output, Price, and Profit: the Importance of Marginal Analysis

The Financial Markets and the Economy: the Tail That Wags the Dog

The Firm and the Industry Under Perfect Competition

The Case for Free Markets: the Price System

Monopoly

Between Competition and Monopoly

Limiting Market Power: Antitrust and Regulation

The Shortcomings of Free Markets

The Economics of the Environment, and Natural Resources

Taxation and Resource Allocation

Pricing the Factors of Production

Labor and Entrepreneurship: the Human Inputs

Poverty, Inequality, and Discrimination

An Introduction to Macroeconomics

The Goals of Macroeconomic Policy

Economic Growth: Theory and Policy

Aggregate Demand and the Powerful Consumer

Demand-Side Equilibrium: Unemployment or Inflation

Bringing in the Supply Side: Unemployment and Inflation

Managing Aggregate Demand: Fiscal Policy

Money and the Banking System

Monetary Policy: Conventional and Unconventional

The Financial Crisis and the Great Recession

The Debate Over Monetary and Fiscal Policy

Budget Deficits in the Short and Long Run

The Trade-Off Between Inflation and Unemployment

International Trade and Comparative Advantage

The International Monetary System: Order or Disorder

Exchange Rates and the Macroeconomy

Contemporary Issues in the Useconomy

Filters

Sugarcane can be used to produce both granulated sugar and ethanol.Recent regulations in certain countries now permit a higher amount of ethanol to be added to gasoline.An economist would expect sugarcane prices to , and quantity sold to .

Sugarcane can be used to produce both granulated sugar and ethanol.Recent regulations in certain countries now permit a higher amount of ethanol to be added to gasoline.As a result of these changes, an economist would expect granulated sugar prices to , and quantity sold to .