Question 1

The price at which sellers are not willing to supply a good is $700 per unit.If the supply curve passes through the point (3,718), what is the equation of the supply curve?

Accepted Answer

A) P = 700 + 6QS 
B) QS = 700 - 6P 
C) P = 718 + 3QS 
D) QS = 718 + 3P 
E) QS = 718 - 6P 
A) P = 700 + 6QS 
B) QS = 700 - 6P 
C) P = 718 + 3QS 
D) QS = 718 + 3P 
E) QS = 718 - 6P

Question 2

Consider a graph that shows an upward-sloping supply curve and a downward-sloping demand curve.The equilibrium price and equilibrium quantity are found at the

Accepted Answer

A) horizontal intercept of the demand curve. 
B) vertical intercept of the supply curve. 
C) lowest possible price. 
D) point at which demand equals supply. 
E) point at which the quantity demanded equals the quantity supplied. 
A) horizontal intercept of the demand curve. 
B) vertical intercept of the supply curve. 
C) lowest possible price. 
D) point at which demand equals supply. 
E) point at which the quantity demanded equals the quantity supplied.

Question 3

When the supply of good A decreases,

Accepted Answer

A) the equilibrium price and the equilibrium quantity will increase. 
B) the equilibrium price will increase, but the equilibrium quantity will decrease. 
C) the equilibrium price and the equilibrium quantity will decrease. 
D) the equilibrium price will decrease, but the equilibrium quantity will increase. 
E) a surplus will result. 
A) the equilibrium price and the equilibrium quantity will increase. 
B) the equilibrium price will increase, but the equilibrium quantity will decrease. 
C) the equilibrium price and the equilibrium quantity will decrease. 
D) the equilibrium price will decrease, but the equilibrium quantity will increase. 
E) a surplus will result.

Question 4

The price of a good will tend to fall if

Accepted Answer

A) there is a surplus at the current price. 
B) the current price is below the equilibrium price. 
C) the quantity supplied exceeds the quantity demanded at the current price. 
D) Both A and C are true. 
E) None of the above are true. 
A) there is a surplus at the current price. 
B) the current price is below the equilibrium price. 
C) the quantity supplied exceeds the quantity demanded at the current price. 
D) Both A and C are true. 
E) None of the above are true.

Question 5

Which one of the following would lead to an increase in the demand for hamburgers?

Accepted Answer

A) a new fad hamburger diet 
B) a decrease in population size 
C) a rise in the price of French fries, a complement of hamburgers 
D) a decrease in consumer income if hamburgers are a normal good 
E) a news report that hamburgers can cause skin diseases 
A) a new fad hamburger diet 
B) a decrease in population size 
C) a rise in the price of French fries, a complement of hamburgers 
D) a decrease in consumer income if hamburgers are a normal good 
E) a news report that hamburgers can cause skin diseases

Question 6

The y- axis intercept of the demand curve is 60 and the slope is - 8.The equation of the demand curve is

Accepted Answer

A) P = 8 - 60QD. 
B) P = 60 - 8QD. 
C) QD = 60 - 8P. 
D) P = 60 + 8QD. 
E) QD = 60 + 8P. 
A) P = 8 - 60QD. 
B) P = 60 - 8QD. 
C) QD = 60 - 8P. 
D) P = 60 + 8QD. 
E) QD = 60 + 8P.

Question 7

A shift of the supply curve for rutabagas occurs if there is

Accepted Answer

A) a change in preferences for rutabagas. 
B) a change in the price of a related good that is a substitute for rutabagas. 
C) a change in income. 
D) a change in the price of rutabagas. 
E) none of the above 
A) a change in preferences for rutabagas. 
B) a change in the price of a related good that is a substitute for rutabagas. 
C) a change in income. 
D) a change in the price of rutabagas. 
E) none of the above

Question 8

Which one of the following would not shift the supply curve of good X to the right?

Accepted Answer

A) a fall in the price of the factors of production used in producing X 
B) an improvement in technology used in the production of X 
C) a rise in the price of X 
D) an increase in the price of Y, a complement in production of X 
E) a fall in the price of Y, a substitute in production of X 
A) a fall in the price of the factors of production used in producing X 
B) an improvement in technology used in the production of X 
C) a rise in the price of X 
D) an increase in the price of Y, a complement in production of X 
E) a fall in the price of Y, a substitute in production of X

Question 9

Consider the market for cell phones.Suppose the price of a cell phone falls.Explain the effect of this event on the quantity of cell phones demanded and on the demand for cell phones.

Accepted Answer

A) The quantity of cell phones demanded is unchanged and the demand for cell phones increases. 
B) The quantity of cell phones demanded decreases and the demand for cell phones is unchanged. 
C) The quantity of cell phones demanded increases and the demand for cell phones is unchanged. 
D) The quantity of cell phones demanded increases and the demand for cell phones also increases. 
E) The quantity of cell phones demanded is unchanged and the demand for cell phones decreases. 
A) The quantity of cell phones demanded is unchanged and the demand for cell phones increases. 
B) The quantity of cell phones demanded decreases and the demand for cell phones is unchanged. 
C) The quantity of cell phones demanded increases and the demand for cell phones is unchanged. 
D) The quantity of cell phones demanded increases and the demand for cell phones also increases. 
E) The quantity of cell phones demanded is unchanged and the demand for cell phones decreases.

Question 10

The law of demand applies to food because when the price of food rises, there is

Accepted Answer

A) a substitution effect that offsets the income effect. 
B) an income effect but no substitution effect. 
C) both a substitution effect and an income effect. 
D) a substitution effect but no income effect. 
E) a substitution effect and a complement effect. 
A) a substitution effect that offsets the income effect. 
B) an income effect but no substitution effect. 
C) both a substitution effect and an income effect. 
D) a substitution effect but no income effect. 
E) a substitution effect and a complement effect.

Question 11

The supply curve of a good slopes upward to the right because of

Accepted Answer

A) technological improvements over time. 
B) the law of supply. 
C) the law of demand. 
D) the existence of substitutes in production. 
E) the fact that prices tend to rise over time. 
A) technological improvements over time. 
B) the law of supply. 
C) the law of demand. 
D) the existence of substitutes in production. 
E) the fact that prices tend to rise over time.

Question 12

Bottled water and health club memberships are

Accepted Answer

A) substitutes. 
B) complements. 
C) substitutes in production. 
D) complements in production. 
E) inferior goods. 
A) substitutes. 
B) complements. 
C) substitutes in production. 
D) complements in production. 
E) inferior goods.

Question 13

Use the table below to answer the following questions.
Table 3.5.3
Demand and supply schedules for designer sport t-shirts at CoolU
  
-Refer to Table 3.5.3.In a television interview, Joe Cool shows off his designer sport t-shirt, setting off a new craze that doubles business at the sportswear establishments.The quantity of t-shirts demanded doubles at each price.The new equilibrium price is $________ and the new equilibrium quantity is ________ t-shirts per month.

Accepted Answer

A) 12; 240 
B) 8; 400 
C) 16; 400 
D) 12; 120 
E) 16; 200 
A) 12; 240 
B) 8; 400 
C) 16; 400 
D) 12; 120 
E) 16; 200

Question 14

A decrease in quantity demanded is represented by a

Accepted Answer

A) rightward shift of the supply curve. 
B) rightward shift of the demand curve. 
C) leftward shift of the demand curve. 
D) movement upward and to the left along the demand curve. 
E) movement downward and to the right along the demand curve. 
A) rightward shift of the supply curve. 
B) rightward shift of the demand curve. 
C) leftward shift of the demand curve. 
D) movement upward and to the left along the demand curve. 
E) movement downward and to the right along the demand curve.

Question 15

Which market is an example of a market for goods?

Accepted Answer

A) labour market 
B) haircut market 
C) manufactured input market 
D) apple market 
E) energy market 
A) labour market 
B) haircut market 
C) manufactured input market 
D) apple market 
E) energy market

Question 16

Use the table below to answer the following questions.
Table 3.4.1
  
-In Table 3.4.1, the equilibrium quantity is

Accepted Answer

A) 200 units. 
B) 320 units. 
C) 420 units. 
D) 500 units. 
E) none of the above; there is no equilibrium. 
A) 200 units. 
B) 320 units. 
C) 420 units. 
D) 500 units. 
E) none of the above; there is no equilibrium.

Question 17

There have been severe problems in the Atlantic fishing industry, with large falls in the fish stocks.As a result,

Accepted Answer

A) the price of fish will fall. 
B) the quantity of fish sold will increase as fishermen will catch more to make up for the shortage. 
C) the equilibrium price and the equilibrium quantity will fall or rise depending on how large the fall in fish stocks. 
D) both the equilibrium price and the equilibrium quantity will rise, as consumers will desire even more fish, because they are scarce. 
E) the fall in the fish stocks will lead to a shortage, a rise in the equilibrium price and a decrease in the equilibrium quantity. 
A) the price of fish will fall. 
B) the quantity of fish sold will increase as fishermen will catch more to make up for the shortage. 
C) the equilibrium price and the equilibrium quantity will fall or rise depending on how large the fall in fish stocks. 
D) both the equilibrium price and the equilibrium quantity will rise, as consumers will desire even more fish, because they are scarce. 
E) the fall in the fish stocks will lead to a shortage, a rise in the equilibrium price and a decrease in the equilibrium quantity.

Question 18

A rise in the price of a good

Accepted Answer

A) decreases demand for the good. 
B) creates a movement up along the supply curve. 
C) creates a movement down along the demand curve. 
D) increases the supply of the good. 
E) increases preferences for the good. 
A) decreases demand for the good. 
B) creates a movement up along the supply curve. 
C) creates a movement down along the demand curve. 
D) increases the supply of the good. 
E) increases preferences for the good.

Question 19

If Canadians suddenly develop a strong urge to escape the cold winter by taking vacations in Hawaii, the

Accepted Answer

A) price of a vacation in Hawaii rises and the quantity demanded of Hawaiian vacations decreases. 
B) price of a skiing vacation in the mountains rises. 
C) initial result of the change is a surplus of vacations in Hawaii, leading to a price rise. 
D) price of airline tickets falls as ticket agents make deals in response to this change. 
E) price of luggage will rise, because luggage and vacations are complements. 
A) price of a vacation in Hawaii rises and the quantity demanded of Hawaiian vacations decreases. 
B) price of a skiing vacation in the mountains rises. 
C) initial result of the change is a surplus of vacations in Hawaii, leading to a price rise. 
D) price of airline tickets falls as ticket agents make deals in response to this change. 
E) price of luggage will rise, because luggage and vacations are complements.

Question 20

Use the figure below to answer the following questions.
   
Figure 3.2.1
-Which one of the following would result in a movement from point A to point B in Figure 3.2.1?

Accepted Answer

A) a fall in the price of apples 
B) a rise in the price of oranges 
C) an increase in population size 
D) public concern about chemicals sprayed on apples 
E) a rise in the price of bananas 
A) a fall in the price of apples 
B) a rise in the price of oranges 
C) an increase in population size 
D) public concern about chemicals sprayed on apples 
E) a rise in the price of bananas

The price at which sellers are not willing to supply a good is $700 per unit.If the supply curve passes through the point (3,718), what is the equation of the supply curve?

Consider a graph that shows an upward-sloping supply curve and a downward-sloping demand curve.The equilibrium price and equilibrium quantity are found at the

When the supply of good A decreases,

The price of a good will tend to fall if

Which one of the following would lead to an increase in the demand for hamburgers?

The y- axis intercept of the demand curve is 60 and the slope is - 8.The equation of the demand curve is

A shift of the supply curve for rutabagas occurs if there is

Which one of the following would not shift the supply curve of good X to the right?

Consider the market for cell phones.Suppose the price of a cell phone falls.Explain the effect of this event on the quantity of cell phones demanded and on the demand for cell phones.

The law of demand applies to food because when the price of food rises, there is

The supply curve of a good slopes upward to the right because of

Bottled water and health club memberships are

A decrease in quantity demanded is represented by a

Which market is an example of a market for goods?

Use the table below to answer the following questions. Table 3.4.1 -In Table 3.4.1, the equilibrium quantity is

There have been severe problems in the Atlantic fishing industry, with large falls in the fish stocks.As a result,

A rise in the price of a good

If Canadians suddenly develop a strong urge to escape the cold winter by taking vacations in Hawaii, the

Use the figure below to answer the following questions. Figure 3.2.1 -Which one of the following would result in a movement from point A to point B in Figure 3.2.1?

What Is Economics

The Economic Problem

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, Preferences, and Choices

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Public Goods and Common Resources

Markets for Factors of Production

Filters

Exam 3: Demand and Supply

The price at which sellers are not willing to supply a good is $700 per unit.If the supply curve passes through the point (3,718), what is the equation of the supply curve?

Consider a graph that shows an upward-sloping supply curve and a downward-sloping demand curve.The equilibrium price and equilibrium quantity are found at the

When the supply of good A decreases,

The price of a good will tend to fall if

Which one of the following would lead to an increase in the demand for hamburgers?

The y- axis intercept of the demand curve is 60 and the slope is - 8.The equation of the demand curve is

A shift of the supply curve for rutabagas occurs if there is

Which one of the following would not shift the supply curve of good X to the right?

Consider the market for cell phones.Suppose the price of a cell phone falls.Explain the effect of this event on the quantity of cell phones demanded and on the demand for cell phones.

The law of demand applies to food because when the price of food rises, there is

The supply curve of a good slopes upward to the right because of

Bottled water and health club memberships are

A decrease in quantity demanded is represented by a

Which market is an example of a market for goods?

Use the table below to answer the following questions. Table 3.4.1 -In Table 3.4.1, the equilibrium quantity is

There have been severe problems in the Atlantic fishing industry, with large falls in the fish stocks.As a result,

A rise in the price of a good

If Canadians suddenly develop a strong urge to escape the cold winter by taking vacations in Hawaii, the

Use the figure below to answer the following questions. Figure 3.2.1 -Which one of the following would result in a movement from point A to point B in Figure 3.2.1?

What Is Economics

The Economic Problem

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, Preferences, and Choices

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Public Goods and Common Resources

Markets for Factors of Production

Filters