Question 1

A supply schedule

Accepted Answer

A) is a table that shows the relationship between the price of a product and the quantity of the product supplied. 
B) is a curve that shows the relationship between the price of a product and the quantity of the product supplied. 
C) is the relationship between the supply of a good and the cost of producing the good. 
D) is a table that shows the relationship between the price of a product and the quantity of the product that producers and consumers are willing to exchange. 
A) is a table that shows the relationship between the price of a product and the quantity of the product supplied. 
B) is a curve that shows the relationship between the price of a product and the quantity of the product supplied. 
C) is the relationship between the supply of a good and the cost of producing the good. 
D) is a table that shows the relationship between the price of a product and the quantity of the product that producers and consumers are willing to exchange.

Question 2

Assume that the demand curve for DVD players shifts to the left and the supply curve for DVD players shifts to the right,but the supply curve shifts more than the demand curve.As a result

Accepted Answer

A) both the equilibrium price and quantity of DVD players will decrease. 
B) the equilibrium price of DVD players will decrease; the equilibrium quantity may increase or decrease. 
C) the equilibrium price of DVD players may increase or decrease; the equilibrium quantity will increase. 
D) the equilibrium price of DVD players will decrease; the equilibrium quantity will increase. 
A) both the equilibrium price and quantity of DVD players will decrease. 
B) the equilibrium price of DVD players will decrease; the equilibrium quantity may increase or decrease. 
C) the equilibrium price of DVD players may increase or decrease; the equilibrium quantity will increase. 
D) the equilibrium price of DVD players will decrease; the equilibrium quantity will increase.

Question 3

The following appeared in a Florida newspaper a week after a hurricane hit the state."Floridians are relieved that the storm produced no fatalities but homeowners face weeks,if not months,of rebuilding.Matters are made worse by the soaring prices of plywood and other building materials that always follow in a hurricane's path.Complaints of profiteering and price gouging have not deterred firms from raising their prices by over 100 percent." Which of the following offers the best explanation for the price increases referred to in the article?

Accepted Answer

A) The hurricane reduced the number of suppliers of building materials. 
B) The hurricane created an artificial shortage of building materials. 
C) The hurricane caused an increase in the demand for building materials. 
D) There was a reduction in supply as firms shipped plywood and other materials to locations not affected by the storm. 
A) The hurricane reduced the number of suppliers of building materials. 
B) The hurricane created an artificial shortage of building materials. 
C) The hurricane caused an increase in the demand for building materials. 
D) There was a reduction in supply as firms shipped plywood and other materials to locations not affected by the storm.

Question 4

If the price of music downloads was to decrease,then

Accepted Answer

A) the demand for MP3 players would decrease. 
B) the demand for MP3 players would increase. 
C) the supply of MP3 players would increase. 
D) the quantity demanded of MP3 players would decrease. 
A) the demand for MP3 players would decrease. 
B) the demand for MP3 players would increase. 
C) the supply of MP3 players would increase. 
D) the quantity demanded of MP3 players would decrease.

Question 5

Figure 3-8
  
-Refer to Figure 3-8.The graph in this figure illustrates an initial competitive equilibrium in the market for motorcycles at the intersection of D₁ and S₂ (point B)If there is an increase in number of companies producing motorcycles and a decrease in income (assume motorcycles are a normal good), the equilibrium could move to which point?

Accepted Answer

A) A 
B) B 
C) C 
D) E 
A) A 
B) B 
C) C 
D) E

Question 6

The demand for soft drinks in the United States has been ________ while the global demand has been ________.

Accepted Answer

A) increasing; increasing 
B) increasing; decreasing 
C) decreasing; increasing 
D) decreasing; decreasing 
A) increasing; increasing 
B) increasing; decreasing 
C) decreasing; increasing 
D) decreasing; decreasing

Question 7

If the demand for a product increases and the supply of the same product increases,the equilibrium price will increase.

Accepted Answer

A) True 
 B)False

Question 8

Figure 3-8
  
-Refer to Figure 3-8.The graph in this figure illustrates an initial competitive equilibrium in the market for apples at the intersection of D₂ and S₁ (point C) Which of the following changes would cause the equilibrium to change to point B?

Accepted Answer

A) A positive change in the technology used to produce apples and decrease in the price of oranges, a substitute for apples. 
B) An increase in the wages of apple workers and an increase in the price of oranges, a substitute for apples. 
C) An increase in the number of apple producers and a decrease in the number of apple trees as a result of disease. 
D) A decrease in the wages of apple workers and an increase in the price of oranges, a substitute for apples. 
A) A positive change in the technology used to produce apples and decrease in the price of oranges, a substitute for apples. 
B) An increase in the wages of apple workers and an increase in the price of oranges, a substitute for apples. 
C) An increase in the number of apple producers and a decrease in the number of apple trees as a result of disease. 
D) A decrease in the wages of apple workers and an increase in the price of oranges, a substitute for apples.

Question 9

The popularity of digital cameras has enticed large discount stores like Wal-Mart and Costco to offer digital photo printing services.How does this affect the digital photo printing market?

Accepted Answer

A) The demand curve for digital photo printing services shifts to the right. 
B) The demand curve for digital photo printing services shifts to the left. 
C) The supply curve for digital photo printing services shifts to the right. 
D) The supply curve for digital photo printing services shifts to the left. 
A) The demand curve for digital photo printing services shifts to the right. 
B) The demand curve for digital photo printing services shifts to the left. 
C) The supply curve for digital photo printing services shifts to the right. 
D) The supply curve for digital photo printing services shifts to the left.

Question 10

Figure 3-7
  
-Refer to Figure 3-7.Assume that the graphs in this figure represent the demand and supply curves for bicycle helmets.Which panel best describes what happens in this market if there is a substantial increase in the price of bicycles?

Accepted Answer

A) Panel (a) 
B) Panel (b) 
C) Panel (c) 
D) Panel (d) 
A) Panel (a) 
B) Panel (b) 
C) Panel (c) 
D) Panel (d)

Question 11

Table 3-4
 $$\begin{array} { | c | c | c | c | c | } 
\begin{array} { c } 
\text { Cashews } \
\text { Priceper lb. } \
\text { (dollars) }
\end{array} & \begin{array} { c } 
\text { Jordy's } \
\text { Quantity } \
\text { Demanded } \
\text { (lbs) }
\end{array} & \begin{array} { c } 
\text { Amy's } \
\text { Quantity } \
\text { Demanded } \
\text { (lbs) }
\end{array} & \begin{array} { c } 
\text { Rest af } \
\text { Market } \
\text { Quantity } \
\text { Demanded } \
\text { (lbs) }
\end{array} & \begin{array} { c } 
\text { Market } \
\text { Quantity } \
\text { Demanded } \
\text { (lbs) }
\end{array} \
\hline \$ 10 & 1 & 1 & 50 & \
\hline 8 & 2 & 3 & 70 & \
\hline 6 & 3 & 5 & 95 & \
\hline 4 & 5 & 9 & 128 & \
\hline 2 & 8 & 14 & 156 & \
\hline
\end{array}$$
-Refer to Table 3-4.The table above shows the demand schedules for cashews of two individuals (Jordy and Amy)and the rest of the market.At a price of $10,the quantity demanded in the market would be

Accepted Answer

A) 2 lbs. 
B) 48 lbs. 
C) 50 lbs 
D) 52 lbs. 
A) 2 lbs. 
B) 48 lbs. 
C) 50 lbs 
D) 52 lbs.

Question 12

Competitive market equilibrium is a market equilibrium with many buyers and sellers.

Accepted Answer

A) True 
 B)False

Question 13

Assume that the demand curve for MP3 players shifts to the right and the supply curve for MP3 players shift to the left,but the supply curve shifts more than the demand curve.As a result

Accepted Answer

A) both the equilibrium price and quantity of MP3 players will decrease. 
B) the equilibrium price of MP3 players will decrease; the equilibrium quantity will increase. 
C) the equilibrium price of MP3 players may increase or decrease; the equilibrium quantity will decrease. 
D) the equilibrium price of MP3 players will increase; the equilibrium quantity will decrease. 
A) both the equilibrium price and quantity of MP3 players will decrease. 
B) the equilibrium price of MP3 players will decrease; the equilibrium quantity will increase. 
C) the equilibrium price of MP3 players may increase or decrease; the equilibrium quantity will decrease. 
D) the equilibrium price of MP3 players will increase; the equilibrium quantity will decrease.

Question 14

Orange juice drinkers want to consume more orange juice at a lower price.Which of the following events would have this effect?

Accepted Answer

A) a decrease in the price of orange juice processing 
B) an increase in the cost of fertilizer used for orange groves 
C) a decrease in income, assuming orange juice is a normal good 
D) a decrease in the population 
A) a decrease in the price of orange juice processing 
B) an increase in the cost of fertilizer used for orange groves 
C) a decrease in income, assuming orange juice is a normal good 
D) a decrease in the population

Question 15

In 2004,hurricanes destroyed a large portion of Florida's grapefruit crop.How did this affect the market price and market quantity of grapefruit?

Accepted Answer

The supply curve for grapefrui

Question 16

For each of the following pairs of products state which are complements,which are substitutes,and which are unrelated.
a.Digital camera and memory stick
b.7Up and Mountain Dew
c.Swimsuits and flip-flops
d.Tylenol and cat food
e.Photocopier and paper

Accepted Answer

a. Complements
b. Su

Question 17

Figure 3-1
  
-Refer to Figure 3-1.An increase in the expected future price of the product would be represented by a movement from

Accepted Answer

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

Question 18

At market equilibrium

Accepted Answer

A) demand equals supply. 
B) quantity demanded equals quantity supplied. 
C) surpluses are greater than shortages. 
D) shortages are greater than surpluses. 
A) demand equals supply. 
B) quantity demanded equals quantity supplied. 
C) surpluses are greater than shortages. 
D) shortages are greater than surpluses.

Question 19

A shortage occurs when the market price is lower than the equilibrium price.

Accepted Answer

A) True 
 B)False

Question 20

Draw a demand curve and label it D1.On the graph,illustrate an increase in demand and a decrease in demand,and label the curves D2 and D3,respectively.Starting on demand curve D₁,explain the shift that would result from each of the following events:
a.a decrease in income and the good is a normal good
b.a decrease in income and the good is an inferior good
c.an increase in the price of a substitute good
d.an increase in the price of a complementary good
e.a decrease in the taste for the good
f.an increase in population
g.a decrease in the expected future price of the good

Accepted Answer

@#IMG-DLM& 
a,d,e,and g would decrease d

A supply schedule

Assume that the demand curve for DVD players shifts to the left and the supply curve for DVD players shifts to the right,but the supply curve shifts more than the demand curve.As a result

If the price of music downloads was to decrease,then

The demand for soft drinks in the United States has been while the global demand has been .

If the demand for a product increases and the supply of the same product increases,the equilibrium price will increase.

Figure 3-8 -Refer to Figure 3-8.The graph in this figure illustrates an initial competitive equilibrium in the market for apples at the intersection of D₂ and S₁ (point C) Which of the following changes would cause the equilibrium to change to point B?

The popularity of digital cameras has enticed large discount stores like Wal-Mart and Costco to offer digital photo printing services.How does this affect the digital photo printing market?

Figure 3-7 -Refer to Figure 3-7.Assume that the graphs in this figure represent the demand and supply curves for bicycle helmets.Which panel best describes what happens in this market if there is a substantial increase in the price of bicycles?

Competitive market equilibrium is a market equilibrium with many buyers and sellers.

Assume that the demand curve for MP3 players shifts to the right and the supply curve for MP3 players shift to the left,but the supply curve shifts more than the demand curve.As a result

Orange juice drinkers want to consume more orange juice at a lower price.Which of the following events would have this effect?

In 2004,hurricanes destroyed a large portion of Florida's grapefruit crop.How did this affect the market price and market quantity of grapefruit?

For each of the following pairs of products state which are complements,which are substitutes,and which are unrelated. a.Digital camera and memory stick b.7Up and Mountain Dew c.Swimsuits and flip-flops d.Tylenol and cat food e.Photocopier and paper

Figure 3-1 -Refer to Figure 3-1.An increase in the expected future price of the product would be represented by a movement from

At market equilibrium

A shortage occurs when the market price is lower than the equilibrium price.

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Market Efficiency and Market Failure

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Consumer Choice and Elasticity

Technology, production, and Costs

Firms in Perfectly Competitive Markets

Monopoly and Antitrust Policy

Monopolistic Competition and Oligopoly

Gdp: Measuring Total Production and Income

Unemployment and Inflation

Economic Growth, the Financial System, and Business Cycles

Aggregate Demand and Aggregate Supply Analysis

Money, banks, and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage, international Trade, and Exchange Rates

Filters

Exam 3: Where Prices Come From: the Interaction of Demand and Supply

A supply schedule

Assume that the demand curve for DVD players shifts to the left and the supply curve for DVD players shifts to the right,but the supply curve shifts more than the demand curve.As a result

If the price of music downloads was to decrease,then

The demand for soft drinks in the United States has been ________ while the global demand has been ________.

If the demand for a product increases and the supply of the same product increases,the equilibrium price will increase.

Figure 3-8 -Refer to Figure 3-8.The graph in this figure illustrates an initial competitive equilibrium in the market for apples at the intersection of D₂ and S₁ (point C) Which of the following changes would cause the equilibrium to change to point B?

The popularity of digital cameras has enticed large discount stores like Wal-Mart and Costco to offer digital photo printing services.How does this affect the digital photo printing market?

Figure 3-7 -Refer to Figure 3-7.Assume that the graphs in this figure represent the demand and supply curves for bicycle helmets.Which panel best describes what happens in this market if there is a substantial increase in the price of bicycles?

Competitive market equilibrium is a market equilibrium with many buyers and sellers.

Assume that the demand curve for MP3 players shifts to the right and the supply curve for MP3 players shift to the left,but the supply curve shifts more than the demand curve.As a result

Orange juice drinkers want to consume more orange juice at a lower price.Which of the following events would have this effect?

In 2004,hurricanes destroyed a large portion of Florida's grapefruit crop.How did this affect the market price and market quantity of grapefruit?

For each of the following pairs of products state which are complements,which are substitutes,and which are unrelated. a.Digital camera and memory stick b.7Up and Mountain Dew c.Swimsuits and flip-flops d.Tylenol and cat food e.Photocopier and paper

Figure 3-1 -Refer to Figure 3-1.An increase in the expected future price of the product would be represented by a movement from

At market equilibrium

A shortage occurs when the market price is lower than the equilibrium price.

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Market Efficiency and Market Failure

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Consumer Choice and Elasticity

Technology, production, and Costs

Firms in Perfectly Competitive Markets

Monopoly and Antitrust Policy

Monopolistic Competition and Oligopoly

Gdp: Measuring Total Production and Income

Unemployment and Inflation

Economic Growth, the Financial System, and Business Cycles

Aggregate Demand and Aggregate Supply Analysis

Money, banks, and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage, international Trade, and Exchange Rates

Filters

The demand for soft drinks in the United States has been while the global demand has been .