Question 1

An increase in quantity supplied is represented by a rightward shift of the supply curve.

Accepted Answer

A) True 
 B)False

Question 2

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 S₂ (point E) Which of the following changes would cause the equilibrium to change to point A?

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 a decrease 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 a decrease 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 3

Figure 3-8
  
-Refer to Figure 3-8.The graph in this figure illustrates an initial competitive equilibrium in the market for sugar at the intersection of D₁ and S₂ (point B) If there is an decrease in the price of fertilizer used on sugar cane and there is a decrease in tastes for sugar-sweetened soft drinks, how will the equilibrium point change?

Accepted Answer

A) The equilibrium point will move from B to A. 
B) The equilibrium point will move from B to C. 
C) There will be no change in the equilibrium point. 
D) The equilibrium point will move from B to E. 
A) The equilibrium point will move from B to A. 
B) The equilibrium point will move from B to C. 
C) There will be no change in the equilibrium point. 
D) The equilibrium point will move from B to E.

Question 4

Figure 3-5
  
-Refer to Figure 3-5.At a price of $10,the quantity sold

Accepted Answer

A) is 2 units. 
B) is 4 units. 
C) is 6 units. 
D) is 8 units. 
A) is 2 units. 
B) is 4 units. 
C) is 6 units. 
D) is 8 units.

Question 5

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.If the price of cashews falls from $4 to $2,the market quantity demanded would

Accepted Answer

A) decrease by 28 lbs. 
B) increase by 36 lbs. 
C) increase by 28 lbs. 
D) decrease by 36 lbs. 
A) decrease by 28 lbs. 
B) increase by 36 lbs. 
C) increase by 28 lbs. 
D) decrease by 36 lbs.

Question 6

Holding everything else constant,a decrease in the price of GPS systems will result in

Accepted Answer

A) an decrease in the quantity of GPS systems demanded. 
B) an increase in the demand for GPS systems. 
C) a decrease in the supply of GPS systems. 
D) an increase in the quantity of GPS systems demanded. 
A) an decrease in the quantity of GPS systems demanded. 
B) an increase in the demand for GPS systems. 
C) a decrease in the supply of GPS systems. 
D) an increase in the quantity of GPS systems demanded.

Question 7

If the demand curve for a product shifts to the left and the supply curve for the product shifts to the left,the equilibrium quantity will decrease.

Accepted Answer

A) True 
 B)False

Question 8

Suppose that when the price of hamburgers increases,the Ruiz family increases their purchases of hot dogs.To the Ruiz family

Accepted Answer

A) hamburgers and hot dogs are complements. 
B) hamburgers and hot dogs are inferior goods. 
C) hamburgers and hot dogs are normal goods. 
D) hamburgers and hot dogs are substitutes. 
A) hamburgers and hot dogs are complements. 
B) hamburgers and hot dogs are inferior goods. 
C) hamburgers and hot dogs are normal goods. 
D) hamburgers and hot dogs are substitutes.

Question 9

If the quantity demanded for a product exceeds the quantity supplied,the market price will rise until

Accepted Answer

A) the quantity demanded equals the quantity supplied.The product will then no longer be scarce. 
B) quantity demanded equals quantity supplied.The equilibrium price will then be greater than the market price. 
C) only wealthy consumers will be able to afford the product. 
D) quantity demanded equals quantity supplied.The market price will then equal the equilibrium price. 
A) the quantity demanded equals the quantity supplied.The product will then no longer be scarce. 
B) quantity demanded equals quantity supplied.The equilibrium price will then be greater than the market price. 
C) only wealthy consumers will be able to afford the product. 
D) quantity demanded equals quantity supplied.The market price will then equal the equilibrium price.

Question 10

An increase in the price of inputs will cause the supply curve for a product to shift to the right.

Accepted Answer

A) True 
 B)False

Question 11

If in the market for peaches,the supply curve has shifted to the left

Accepted Answer

A) the supply of peaches has increased. 
B) the supply of peaches has decreased. 
C) the quantity of peaches supplied has increased. 
D) the quantity of peaches supplied has decreased. 
A) the supply of peaches has increased. 
B) the supply of peaches has decreased. 
C) the quantity of peaches supplied has increased. 
D) the quantity of peaches supplied has decreased.

Question 12

Studies have shown links between calcium consumption and a reduction in osteoporosis.How does this affect the market for calcium?

Accepted Answer

A) The calcium supply curve shifts to the right because of a change in tastes in favor of calcium. 
B) The calcium demand curve shifts to the right because of a change in tastes in favor of calcium. 
C) The calcium demand curve shifts to the left because this new information will increase the price of calcium. 
D) The calcium supply curve shifts to the left because this new information will increase the price of calcium. 
A) The calcium supply curve shifts to the right because of a change in tastes in favor of calcium. 
B) The calcium demand curve shifts to the right because of a change in tastes in favor of calcium. 
C) The calcium demand curve shifts to the left because this new information will increase the price of calcium. 
D) The calcium supply curve shifts to the left because this new information will increase the price of calcium.

Question 13

Figure 3-1
  
-Refer to Figure 3-1.A decrease 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 14

What would happen in the market for knee replacement surgery if insurance companies started to cover a smaller portion of the cost of the surgery?

Accepted Answer

A) Demand will decrease, but this will not shift the supply curve. 
B) Supply will decrease, but this will not shift the demand curve. 
C) Demand and supply will both decrease. 
D) Demand will decrease and supply will increase. 
A) Demand will decrease, but this will not shift the supply curve. 
B) Supply will decrease, but this will not shift the demand curve. 
C) Demand and supply will both decrease. 
D) Demand will decrease and supply will increase.

Question 15

The law of demand implies,holding everything else constant,that as the price of yogurt

Accepted Answer

A) increases, the demand for yogurt will increase. 
B) increases, the quantity of yogurt demanded will decrease. 
C) decreases, the quantity of yogurt demanded will decrease. 
D) decreases, the demand for yogurt will increase. 
A) increases, the demand for yogurt will increase. 
B) increases, the quantity of yogurt demanded will decrease. 
C) decreases, the quantity of yogurt demanded will decrease. 
D) decreases, the demand for yogurt will increase.

Question 16

Which of the following would cause both the equilibrium price and equilibrium quantity of barley (assume that barley is an inferior good)to increase?

Accepted Answer

A) an increase in consumer income 
B) a drought that sharply reduces barley output 
C) a decrease in consumer income 
D) unusually good weather that results in a bumper crop of barley 
A) an increase in consumer income 
B) a drought that sharply reduces barley output 
C) a decrease in consumer income 
D) unusually good weather that results in a bumper crop of barley

Question 17

A decrease in the number of firms in a market will cause supply to increase.

Accepted Answer

A) True 
 B)False

Question 18

The supply curve for watches

Accepted Answer

A) shows the supply of watches consumers are willing and able to buy at any given price. 
B) is downward sloping. 
C) shows the relationship between the quantity of watches firms are willing and able to supply and the quantity of watches consumers are willing and able to purchase. 
D) shows the relationship between the price of watches and the quantity of watches supplied. 
A) shows the supply of watches consumers are willing and able to buy at any given price. 
B) is downward sloping. 
C) shows the relationship between the quantity of watches firms are willing and able to supply and the quantity of watches consumers are willing and able to purchase. 
D) shows the relationship between the price of watches and the quantity of watches supplied.

Question 19

In 2004,hurricanes damaged a large portion of Florida's orange crop.As a result of this,many orange growers were not able to supply fruit to the market.At the pre-hurricane equilibrium price (i.e.,at the initial equilibrium price),we would expect to see

Accepted Answer

A) a surplus of oranges. 
B) the quantity demanded equal to the quantity supplied. 
C) a shortage of oranges. 
D) an increase in the demand for oranges. 
A) a surplus of oranges. 
B) the quantity demanded equal to the quantity supplied. 
C) a shortage of oranges. 
D) an increase in the demand for oranges.

Question 20

Technological advances have resulted in lower prices for digital cameras.What is the impact of this on the market for traditional (non-digital)cameras?

Accepted Answer

A) The demand curve for traditional cameras shifts to the right. 
B) The supply curve for traditional cameras shifts to the right. 
C) The demand curve for traditional cameras shifts to the left. 
D) The supply curve for traditional cameras shifts to the left. 
A) The demand curve for traditional cameras shifts to the right. 
B) The supply curve for traditional cameras shifts to the right. 
C) The demand curve for traditional cameras shifts to the left. 
D) The supply curve for traditional cameras shifts to the left.

An increase in quantity supplied is represented by a rightward shift of the supply curve.

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 S₂ (point E) Which of the following changes would cause the equilibrium to change to point A?

Figure 3-5 -Refer to Figure 3-5.At a price of $10,the quantity sold

Holding everything else constant,a decrease in the price of GPS systems will result in

If the demand curve for a product shifts to the left and the supply curve for the product shifts to the left,the equilibrium quantity will decrease.

Suppose that when the price of hamburgers increases,the Ruiz family increases their purchases of hot dogs.To the Ruiz family

If the quantity demanded for a product exceeds the quantity supplied,the market price will rise until

An increase in the price of inputs will cause the supply curve for a product to shift to the right.

If in the market for peaches,the supply curve has shifted to the left

Studies have shown links between calcium consumption and a reduction in osteoporosis.How does this affect the market for calcium?

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

What would happen in the market for knee replacement surgery if insurance companies started to cover a smaller portion of the cost of the surgery?

The law of demand implies,holding everything else constant,that as the price of yogurt

Which of the following would cause both the equilibrium price and equilibrium quantity of barley (assume that barley is an inferior good)to increase?

A decrease in the number of firms in a market will cause supply to increase.

The supply curve for watches

In 2004,hurricanes damaged a large portion of Florida's orange crop.As a result of this,many orange growers were not able to supply fruit to the market.At the pre-hurricane equilibrium price (i.e.,at the initial equilibrium price),we would expect to see

Technological advances have resulted in lower prices for digital cameras.What is the impact of this on the market for traditional (non-digital)cameras?

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

An increase in quantity supplied is represented by a rightward shift of the supply curve.

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 S₂ (point E) Which of the following changes would cause the equilibrium to change to point A?

Figure 3-5 -Refer to Figure 3-5.At a price of $10,the quantity sold

Holding everything else constant,a decrease in the price of GPS systems will result in

If the demand curve for a product shifts to the left and the supply curve for the product shifts to the left,the equilibrium quantity will decrease.

Suppose that when the price of hamburgers increases,the Ruiz family increases their purchases of hot dogs.To the Ruiz family

If the quantity demanded for a product exceeds the quantity supplied,the market price will rise until

An increase in the price of inputs will cause the supply curve for a product to shift to the right.

If in the market for peaches,the supply curve has shifted to the left

Studies have shown links between calcium consumption and a reduction in osteoporosis.How does this affect the market for calcium?

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

What would happen in the market for knee replacement surgery if insurance companies started to cover a smaller portion of the cost of the surgery?

The law of demand implies,holding everything else constant,that as the price of yogurt

Which of the following would cause both the equilibrium price and equilibrium quantity of barley (assume that barley is an inferior good)to increase?

A decrease in the number of firms in a market will cause supply to increase.

The supply curve for watches

In 2004,hurricanes damaged a large portion of Florida's orange crop.As a result of this,many orange growers were not able to supply fruit to the market.At the pre-hurricane equilibrium price (i.e.,at the initial equilibrium price),we would expect to see

Technological advances have resulted in lower prices for digital cameras.What is the impact of this on the market for traditional (non-digital)cameras?

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