Question 1

The short run is depicted by a vertical supply curve.

Accepted Answer

A) True 
 B)False

Question 2

A long-run supply curve is more price sensitive than a short-run supply curve.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following can bring about a change in the quantity demanded?

Accepted Answer

A)  decrease in quantity supplied 
B)  increase in quantity supplied 
C)  change in income 
D)  change in price 
E)  change in taste 
A)  decrease in quantity supplied 
B)  increase in quantity supplied 
C)  change in income 
D)  change in price 
E)  change in taste

Question 4

Price doesn't change in a market-day supply curve.

Accepted Answer

A) True 
 B)False

Question 5

-In Exhibit C-19, a movement from A to B is best explained by

Accepted Answer

A)  an increase in income and in the number of suppliers 
B)  an increase in the price of other goods 
C)  an increase in the population 
D)  a decrease in income and an improvement in the technology used to produce the good 
E)  equilibrium quantity increases and the equilibrium price change is indeterminate 
A)  an increase in income and in the number of suppliers 
B)  an increase in the price of other goods 
C)  an increase in the population 
D)  a decrease in income and an improvement in the technology used to produce the good 
E)  equilibrium quantity increases and the equilibrium price change is indeterminate

Question 6

If people buy less of a good at every price when their incomes fall, then that good is a normal good.

Accepted Answer

A) True 
 B)False

Question 7

The quantity supplied of a good for the market day increases with increases in price.

Accepted Answer

A) True 
 B)False

Question 8

Consider a market that is initially in equilibrium. If we observe that price increased and quantity decreased, then which of the following could have occurred?

Accepted Answer

A)  demand increased 
B)  supply increased 
C)  supply decreased 
D)  demand decreased 
E)  both demand and supply increased 
A)  demand increased 
B)  supply increased 
C)  supply decreased 
D)  demand decreased 
E)  both demand and supply increased

Question 9

The horizontal summing of individual demand curves creates

Accepted Answer

A)  a horizontal supply curve 
B)  a vertical supply curve 
C)  a market demand curve 
D)  the quantity supplied for each individual demand 
E)  the quantity demanded for each individual supply 
A)  a horizontal supply curve 
B)  a vertical supply curve 
C)  a market demand curve 
D)  the quantity supplied for each individual demand 
E)  the quantity demanded for each individual supply

Question 10

Which of the following is true about the supply of fish during the market-day?

Accepted Answer

A)  The quantity supplied of fish increases as price increases. 
B)  The quantity supplied of fish decreases as price increases. 
C)  The quantity supplied of fish does not change regardless of price. 
D)  The quantity supplied of fish will adjust with changes in demand. 
E)  The quantity supplied of fish decreases as price decreases. 
A)  The quantity supplied of fish increases as price increases. 
B)  The quantity supplied of fish decreases as price increases. 
C)  The quantity supplied of fish does not change regardless of price. 
D)  The quantity supplied of fish will adjust with changes in demand. 
E)  The quantity supplied of fish decreases as price decreases.

Question 11

-In Exhibit C-6, if there is a shortage of 200 radios, price must be

Accepted Answer

A)  $60 
B)  $55 
C)  $50 
D)  $45 
E)  $40 
A)  $60 
B)  $55 
C)  $50 
D)  $45 
E)  $40

Question 12

-In Exhibit C-9, the original market equilibrium is determined by D1 and S1. Suppose demand shifts to D2. What will cause price to move to a new equilibrium?

Accepted Answer

A)  An excess demand is created at the original price so that competition among demanders will force quantity to fall. 
B)  An excess supply is created at the original price so that competition among suppliers will force price up. 
C)  An excess demand is created at the original price so that competition among demanders will force price down. 
D)  An excess demand is created at the original price so that competition among demanders will force price up. 
E)  An excess supply is created at the original price so that competition among suppliers will force price down 
A)  An excess demand is created at the original price so that competition among demanders will force quantity to fall. 
B)  An excess supply is created at the original price so that competition among suppliers will force price up. 
C)  An excess demand is created at the original price so that competition among demanders will force price down. 
D)  An excess demand is created at the original price so that competition among demanders will force price up. 
E)  An excess supply is created at the original price so that competition among suppliers will force price down

Question 13

A decline in the supply of coffee will result in a(n)

Accepted Answer

A)  increase in its demand 
B)  rise in price and a fall in quantity 
C)  rise in price and a rise in quantity 
D)  fall in price and a fall in quantity 
E)  fall in price and a rise in quantity 
A)  increase in its demand 
B)  rise in price and a fall in quantity 
C)  rise in price and a rise in quantity 
D)  fall in price and a fall in quantity 
E)  fall in price and a rise in quantity

Question 14

-In Exhibit C-5 (on the following page), if price is $75, a(n) ____ would result, causinga(n) ___ in price.

Accepted Answer

A)  excess demand; increase 
B)  excess demand; decrease 
C)  excess supply; increase 
D)  excess supply; decrease 
E)  market clearing; change 
A)  excess demand; increase 
B)  excess demand; decrease 
C)  excess supply; increase 
D)  excess supply; decrease 
E)  market clearing; change

Question 15

If an earthquake destroys most of a country's steel mills, then the country's supply curve of steel will shift to the left.

Accepted Answer

A) True 
 B)False

Question 16

Consider the case of complementary goods. An increase in the demand for peanut butter can be caused by a(n)

Accepted Answer

A)  decrease in consumer income 
B)  increase in the price of jams, jellies, and preserves 
C)  decrease in the price of bread 
D)  drought in Georgia that destroyed 30 percent of the peanut crop 
E)  decrease in the price of bologna 
A)  decrease in consumer income 
B)  increase in the price of jams, jellies, and preserves 
C)  decrease in the price of bread 
D)  drought in Georgia that destroyed 30 percent of the peanut crop 
E)  decrease in the price of bologna

Question 17

A change in flour prices shifts the supply curve for bread.

Accepted Answer

A) True 
 B)False

Question 18

If both supply and demand decrease and the shift in supply dominates, which of the following happens?

Accepted Answer

A)  The equilibrium quantity increases. 
B)  The equilibrium price and the equilibrium quantity decrease. 
C)  The equilibrium price decreases and equilibrium quantity increases. 
D)  The equilibrium quantity increases and the equilibrium price change is indeterminate. 
E)  The equilibrium price increases and the equilibrium quantity decreases. 
A)  The equilibrium quantity increases. 
B)  The equilibrium price and the equilibrium quantity decrease. 
C)  The equilibrium price decreases and equilibrium quantity increases. 
D)  The equilibrium quantity increases and the equilibrium price change is indeterminate. 
E)  The equilibrium price increases and the equilibrium quantity decreases.

Question 19

The maple-syrup production industry was severely affected by a devastating ice storm in January 1998.Quebec, which produces 75 percent of the world's maple syrup, and northern Vermont and western Maine suffered catastrophic damage to their maple trees. These trees will take years to recover. Explainhow this storm will affect each of the following markets:
a. maple syrup market
 b. market for Hungry Jack brand breakfast syrup (a corn syrup based product substitute)
 c. market for Sue Bee brand honey
 d. market for Eggo brand waffles

Accepted Answer

a. The supply curve of maple syrup decre

Question 20

For complementary goods, an increase in the price of one results in a decrease in demand for the others.

Accepted Answer

A) True 
 B)False

The short run is depicted by a vertical supply curve.

A long-run supply curve is more price sensitive than a short-run supply curve.

Which of the following can bring about a change in the quantity demanded?

Price doesn't change in a market-day supply curve.

-In Exhibit C-19, a movement from A to B is best explained by

If people buy less of a good at every price when their incomes fall, then that good is a normal good.

The quantity supplied of a good for the market day increases with increases in price.

Consider a market that is initially in equilibrium. If we observe that price increased and quantity decreased, then which of the following could have occurred?

The horizontal summing of individual demand curves creates

Which of the following is true about the supply of fish during the market-day?

-In Exhibit C-6, if there is a shortage of 200 radios, price must be

-In Exhibit C-9, the original market equilibrium is determined by D₁ and S₁. Suppose demand shifts to D₂. What will cause price to move to a new equilibrium?

A decline in the supply of coffee will result in a(n)

-In Exhibit C-5 (on the following page), if price is $75, a(n) __ would result, causinga(n) _ in price.

If an earthquake destroys most of a country's steel mills, then the country's supply curve of steel will shift to the left.

Consider the case of complementary goods. An increase in the demand for peanut butter can be caused by a(n)

A change in flour prices shifts the supply curve for bread.

If both supply and demand decrease and the shift in supply dominates, which of the following happens?

For complementary goods, an increase in the price of one results in a decrease in demand for the others.

Introduction

Production Possibilities and Opportunity Costs

Elasticity

Happiness, Utility, and Consumer Choice

Price Ceilings and Price Floors

Entrepreneurship and Business Ownership

Costs of Production

Maximizing Profit

Identifying Markets and Market Structures

Price and Output in Monopoly, Monopolistic Competition, and Perfect Competition

Price and Output Determination Under Oligopoly

Antitrust and Regulation

Externalities, Market Failure, and Public Choice

Wage Rates in Competitive Labor Markets

Wages and Employment: Monopsony and Labor Unions

Interest, Rent, and Profit

Income Distribution and Poverty

International Trade

Exchange Rates, Balance of Payments, and International Debt

The Economic Problems of Less-Developed Economies

Filters

Exam 3: Demand and Supply

The short run is depicted by a vertical supply curve.

A long-run supply curve is more price sensitive than a short-run supply curve.

Which of the following can bring about a change in the quantity demanded?

Price doesn't change in a market-day supply curve.

-In Exhibit C-19, a movement from A to B is best explained by

If people buy less of a good at every price when their incomes fall, then that good is a normal good.

The quantity supplied of a good for the market day increases with increases in price.

Consider a market that is initially in equilibrium. If we observe that price increased and quantity decreased, then which of the following could have occurred?

The horizontal summing of individual demand curves creates

Which of the following is true about the supply of fish during the market-day?

-In Exhibit C-6, if there is a shortage of 200 radios, price must be

-In Exhibit C-9, the original market equilibrium is determined by D1 and S1. Suppose demand shifts to D2. What will cause price to move to a new equilibrium?

A decline in the supply of coffee will result in a(n)

-In Exhibit C-5 (on the following page), if price is $75, a(n) ____ would result, causinga(n) ___ in price.

If an earthquake destroys most of a country's steel mills, then the country's supply curve of steel will shift to the left.

Consider the case of complementary goods. An increase in the demand for peanut butter can be caused by a(n)

A change in flour prices shifts the supply curve for bread.

If both supply and demand decrease and the shift in supply dominates, which of the following happens?

For complementary goods, an increase in the price of one results in a decrease in demand for the others.

Introduction

Production Possibilities and Opportunity Costs

Elasticity

Happiness, Utility, and Consumer Choice

Price Ceilings and Price Floors

Entrepreneurship and Business Ownership

Costs of Production

Maximizing Profit

Identifying Markets and Market Structures

Price and Output in Monopoly, Monopolistic Competition, and Perfect Competition

Price and Output Determination Under Oligopoly

Antitrust and Regulation

Externalities, Market Failure, and Public Choice

Wage Rates in Competitive Labor Markets

Wages and Employment: Monopsony and Labor Unions

Interest, Rent, and Profit

Income Distribution and Poverty

International Trade

Exchange Rates, Balance of Payments, and International Debt

The Economic Problems of Less-Developed Economies

Filters

-In Exhibit C-9, the original market equilibrium is determined by D₁ and S₁. Suppose demand shifts to D₂. What will cause price to move to a new equilibrium?

-In Exhibit C-5 (on the following page), if price is $75, a(n) __ would result, causinga(n) _ in price.