Question 1

In 2004,hurricanes destroyed a large portion of Florida's orange and grapefruit crops.In the market for citrus fruit,

Accepted Answer

A)  the supply curve shifted to the right resulting in an increase in the equilibrium price. 
B)  the supply curve shifted to the left resulting in an increase in the equilibrium price. 
C)  the demand curve shifted to the right resulting in an increase in the equilibrium price. 
D)  the demand curve shifted to the left resulting in a decrease in the equilibrium price. 
A)  the supply curve shifted to the right resulting in an increase in the equilibrium price. 
B)  the supply curve shifted to the left resulting in an increase in the equilibrium price. 
C)  the demand curve shifted to the right resulting in an increase in the equilibrium price. 
D)  the demand curve shifted to the left resulting in a decrease in the equilibrium price.

Question 2

The market for tablet computers has grown rapidly over the past few years,due in part to the overwhelming success of the Apple iPad.Following the successful launch of the iPad in 2010,companies such as Toshiba,Samsung,Dell,and Amazon have all introduced products to compete with the iPad.The tablet computers introduced to compete with the iPad would be considered

Accepted Answer

A)  complements to the iPad. 
B)  substitutes for the iPad. 
C)  inferior goods compared to the iPad. 
D)  normal goods compared to the iPad. 
A)  complements to the iPad. 
B)  substitutes for the iPad. 
C)  inferior goods compared to the iPad. 
D)  normal goods compared to the iPad.

Question 3

Which of the following would cause both the equilibrium price and equilibrium quantity of cotton (assume that cotton is a normal good)to increase?

Accepted Answer

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

Question 4

The income effect of a price change refers to the impact of a change in

Accepted Answer

A)  income on the price of a good. 
B)  demand when income changes. 
C)  the quantity demanded when income changes. 
D)  the price of a good on a consumer's purchasing power. 
A)  income on the price of a good. 
B)  demand when income changes. 
C)  the quantity demanded when income changes. 
D)  the price of a good on a consumer's purchasing power.

Question 5

Auctions in recent years have resulted in higher prices paid for letters written by John Wilkes Booth than those written by Abraham Lincoln.Which of the following events would cause the price differences in these letters to get smaller?

Accepted Answer

A)  The demand for Booth letters decreases. 
B)  The supply of Lincoln letters increases. 
C)  The demand for Lincoln letters increases and the supply of Booth letters increases. 
D)  The demand for Lincoln letters decreases and the demand for Booth letters increases.. 
A)  The demand for Booth letters decreases. 
B)  The supply of Lincoln letters increases. 
C)  The demand for Lincoln letters increases and the supply of Booth letters increases. 
D)  The demand for Lincoln letters decreases and the demand for Booth letters increases..

Question 6

Which of the following would cause a decrease in the supply of milk?

Accepted Answer

A)  an increase in the price of cookies (assuming that milk and cookies are complements) 
B)  a decrease in the price of milk 
C)  an increase the price of a product that producers sell instead of milk 
D)  an increase in the number of firms that produce milk 
A)  an increase in the price of cookies (assuming that milk and cookies are complements) 
B)  a decrease in the price of milk 
C)  an increase the price of a product that producers sell instead of milk 
D)  an increase in the number of firms that produce milk

Question 7

"The price of compact fluorescent light bulbs fell because of improvements in production technology.As a result,the demand for incandescent light bulbs decreased.This caused the price of incandescent light bulbs to fall; as the price of incandescent light bulbs fell the demand for incandescent light bulbs decreased even further." Evaluate this statement.

Accepted Answer

A)  The statement is false. A decrease in the price of compact fluorescent light bulbs would decrease the demand for incandescent light bulbs, but a decrease in the price of incandescent light bulbs would not cause the demand for incandescent light bulbs to decrease. 
B)  The statement is false because the demand for incandescent light bulbs would increase as the price of compact fluorescent light bulbs fell. 
C)  The statement is false because compact fluorescent light bulbs producers would not reduce their prices as a result of improvements in technology; doing so would reduce their profits. 
D)  The statement is false because it confuses the law of demand with the law of supply. 
A)  The statement is false. A decrease in the price of compact fluorescent light bulbs would decrease the demand for incandescent light bulbs, but a decrease in the price of incandescent light bulbs would not cause the demand for incandescent light bulbs to decrease. 
B)  The statement is false because the demand for incandescent light bulbs would increase as the price of compact fluorescent light bulbs fell. 
C)  The statement is false because compact fluorescent light bulbs producers would not reduce their prices as a result of improvements in technology; doing so would reduce their profits. 
D)  The statement is false because it confuses the law of demand with the law of supply.

Question 8

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

Accepted Answer

A)  the quantity demanded exceeds the quantity supplied. The market will then be in equilibrium. 
B)  quantity demanded equals quantity supplied. The equilibrium price will then be lower than the market price. 
C)  all 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 exceeds the quantity supplied. The market will then be in equilibrium. 
B)  quantity demanded equals quantity supplied. The equilibrium price will then be lower than the market price. 
C)  all consumers will be able to afford the product. 
D)  quantity demanded equals quantity supplied. The market price will then equal the equilibrium price.

Question 9

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.

In 2004,hurricanes destroyed a large portion of Florida's orange and grapefruit crops.In the market for citrus fruit,

Which of the following would cause both the equilibrium price and equilibrium quantity of cotton (assume that cotton is a normal good)to increase?

The income effect of a price change refers to the impact of a change in

Auctions in recent years have resulted in higher prices paid for letters written by John Wilkes Booth than those written by Abraham Lincoln.Which of the following events would cause the price differences in these letters to get smaller?

Which of the following would cause a decrease in the supply of milk?

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

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

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Economic Efficiency,government Price Setting,and Taxes

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Comparative Advantage and the Gains From International Trade

Gdp: Measuring Total Production and Income

Unemployment and Inflation

Economic Growth, the Financial System, and Business Cycles

Long-Run Economic Growth: Sources and Policies

Aggregate Expenditure and Output in the Short Run

Aggregate Demand and Aggregate Supply Analysis

Money,banks,and the Federal Reserve System

Monetary Policy

Fiscal Policy

Inflation, unemployment, and Federal Reserve Policy

Macroeconomics in an Open Economy

The International Financial System

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

In 2004,hurricanes destroyed a large portion of Florida's orange and grapefruit crops.In the market for citrus fruit,

Which of the following would cause both the equilibrium price and equilibrium quantity of cotton (assume that cotton is a normal good)to increase?

The income effect of a price change refers to the impact of a change in

Auctions in recent years have resulted in higher prices paid for letters written by John Wilkes Booth than those written by Abraham Lincoln.Which of the following events would cause the price differences in these letters to get smaller?

Which of the following would cause a decrease in the supply of milk?

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

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

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Economic Efficiency,government Price Setting,and Taxes

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Comparative Advantage and the Gains From International Trade

Gdp: Measuring Total Production and Income

Unemployment and Inflation

Economic Growth, the Financial System, and Business Cycles

Long-Run Economic Growth: Sources and Policies

Aggregate Expenditure and Output in the Short Run

Aggregate Demand and Aggregate Supply Analysis

Money,banks,and the Federal Reserve System

Monetary Policy

Fiscal Policy

Inflation, unemployment, and Federal Reserve Policy

Macroeconomics in an Open Economy

The International Financial System

Filters