Question 1

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

Accepted Answer

A) True 
 B)False

Question 2

The following are the equations for the supply and demand curves in the market for weezils:     where Q  d  is the quantity demanded, Q  s  is the quantity supplied, and P is the price per weezil in dollars.
Refer to Exhibit 4-1. According to the data given, when the market is in Equilibrium, how many weezils are sold?

Accepted Answer

A) 3 
B) 5 
C) 11 
D) 14 
A) 3 
B) 5 
C) 11 
D) 14

Question 3

A government policy that prevents the price of a good or service from falling below a specified level is called a price floor and usually results in

Accepted Answer

A) a shortage. 
B) a surplus. 
C) a black market. 
D) fewer producers of the good or service. 
E) a decrease in demand. 
A) a shortage. 
B) a surplus. 
C) a black market. 
D) fewer producers of the good or service. 
E) a decrease in demand.

Question 4

A shift of the demand curve for a good occurs whenever new technologies make inputs used in producing that good available at lower prices.

Accepted Answer

A) True 
 B)False

Question 5

Lines, ration coupons, and black markets are byproducts of a

Accepted Answer

A) price floor. 
B) price ceiling. 
C) free market. 
D) barter economy. 
A) price floor. 
B) price ceiling. 
C) free market. 
D) barter economy.

Question 6

The unemployment of some groups, such as low-skill workers, may increase as a result of the imposition of a minimum wage.

Accepted Answer

A) True 
 B)False

Question 7

An increase in price is likely to affect demand in what way?

Accepted Answer

A) Demand will increase. 
B) Demand will decrease. 
C) Demand will not change. 
D) This would only affect supply and not demand. 
A) Demand will increase. 
B) Demand will decrease. 
C) Demand will not change. 
D) This would only affect supply and not demand.

Question 8

-Refer to Table 4-1. At $10, what is the surplus?

Accepted Answer

A) 4,500 
B) 3,000 
C) 1,500 
D) 0 
A) 4,500 
B) 3,000 
C) 1,500 
D) 0

Question 9

The demand curve for a typical good has

Accepted Answer

A) a negative slope because consumers purchase less of the good as the price rises. 
B) a negative slope because the supply of the good rises as demand rises. 
C) a negative slope because the good has less "snob appeal" as its price falls. 
D) a positive slope because as the price goes up, the good has more profitability. 
E) a positive slope because price is a clear indicator of need. 
A) a negative slope because consumers purchase less of the good as the price rises. 
B) a negative slope because the supply of the good rises as demand rises. 
C) a negative slope because the good has less "snob appeal" as its price falls. 
D) a positive slope because as the price goes up, the good has more profitability. 
E) a positive slope because price is a clear indicator of need.

Question 10

Price ceilings are designed to protect sellers, while price floors are designed to protect buyers.

Accepted Answer

A) True 
 B)False

Question 11

Any factor that shifts the demand curve to the left but does not affect the supply curve will lower the equilibrium price and raise the equilibrium quantity.

Accepted Answer

A) True 
 B)False

Question 12

If the price of a good rises, supply will

Accepted Answer

A) increase. 
B) decrease. 
C) not change. 
D) the answer depends upon the demand in the market. 
A) increase. 
B) decrease. 
C) not change. 
D) the answer depends upon the demand in the market.

Question 13

Advertising has no effect on the demand schedule for a good.

Accepted Answer

A) True 
 B)False

Question 14

A demand schedule is a table showing how the ____ of some product during a specified period of time changes as ____ changes, holding all other determinants of quantity demanded constant.

Accepted Answer

A) demand; the price of its complement 
B) demand; the quantity supplied 
C) quantity demanded; the price of its substitute 
D) quantity demanded; the price of that product 
A) demand; the price of its complement 
B) demand; the quantity supplied 
C) quantity demanded; the price of its substitute 
D) quantity demanded; the price of that product

Question 15

Price ceilings generally do not lead to which of the following?

Accepted Answer

A) Persistent shortages 
B) A reduction in the quality of the good 
C) An increase in the number of units purchased 
D) The development of black markets 
A) Persistent shortages 
B) A reduction in the quality of the good 
C) An increase in the number of units purchased 
D) The development of black markets

Question 16

​
The silverware industry has been in serious decline since the 1980s. Family dining habits are less formal so people purchase less silverware. More recently, the price of silver jumped from $5 to $20 per ounce. Which graph in Figure 4-12 best illustrates these developments?

Accepted Answer

A) 1 
B) 2 
C) 3 
D) 4 
A) 1 
B) 2 
C) 3 
D) 4

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

Which of the following would cause a movement up (or leftward)along the demand curve for European autos in the United States?

Accepted Answer

A) An increase in the price of American autos 
B) A decrease in the price of American autos 
C) An increase in income in the United States 
D) An increase in the price of European cars 
A) An increase in the price of American autos 
B) A decrease in the price of American autos 
C) An increase in income in the United States 
D) An increase in the price of European cars

Question 19

Suppose demand can be described with the equation Q = 900 − 5P and supply with the equation Q = 100 + 5P. 
A.Determine the equilibrium price and quantity. 
B.Determine the surplus or shortage if the price were $100. 
​

Accepted Answer

a.Equate the supply and demand as follow

Question 20

A shortage will tend to occur at which price in Figure 4-21?

Accepted Answer

A) P  1  
B) P  2  
C) P  3  
D) There will be no shortage at the prices shown. 
A) P  1  
B) P  2  
C) P  3  
D) There will be no shortage at the prices shown.

Exam 4: Supply and Demand: an Initial Look

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

A government policy that prevents the price of a good or service from falling below a specified level is called a price floor and usually results in

A shift of the demand curve for a good occurs whenever new technologies make inputs used in producing that good available at lower prices.

Lines, ration coupons, and black markets are byproducts of a

The unemployment of some groups, such as low-skill workers, may increase as a result of the imposition of a minimum wage.

An increase in price is likely to affect demand in what way?

-Refer to Table 4-1. At $10, what is the surplus?

The demand curve for a typical good has

Price ceilings are designed to protect sellers, while price floors are designed to protect buyers.

Any factor that shifts the demand curve to the left but does not affect the supply curve will lower the equilibrium price and raise the equilibrium quantity.

If the price of a good rises, supply will

Advertising has no effect on the demand schedule for a good.

A demand schedule is a table showing how the ____ of some product during a specified period of time changes as ____ changes, holding all other determinants of quantity demanded constant.

Price ceilings generally do not lead to which of the following?

​ The silverware industry has been in serious decline since the 1980s. Family dining habits are less formal so people purchase less silverware. More recently, the price of silver jumped from $5 to $20 per ounce. Which graph in Figure 4-12 best illustrates these developments?

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

Which of the following would cause a movement up (or leftward)along the demand curve for European autos in the United States?

Suppose demand can be described with the equation Q = 900 − 5P and supply with the equation Q = 100 + 5P. A.Determine the equilibrium price and quantity. B.Determine the surplus or shortage if the price were $100. ​

A shortage will tend to occur at which price in Figure 4-21?

What Is Economics

The Economy: 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

Externalities, Externaliteis, the Environment, and Natural Resources

Taxation and Resource Allocation

Pricing the Factors of Production

Labor and Entrepreneurship: the Human Inputs

Poverty, Inequality, and Discrimination

International Trade and Comparative Advantage

Contemporary Issues in the Us Economy

Filters

A demand schedule is a table showing how the of some product during a specified period of time changes as changes, holding all other determinants of quantity demanded constant.

The silverware industry has been in serious decline since the 1980s. Family dining habits are less formal so people purchase less silverware. More recently, the price of silver jumped from $5 to $20 per ounce. Which graph in Figure 4-12 best illustrates these developments?

Suppose demand can be described with the equation Q = 900 − 5P and supply with the equation Q = 100 + 5P. A.Determine the equilibrium price and quantity. B.Determine the surplus or shortage if the price were $100.