Question 1

For consumers, taco chips and salsa are complements. If the price of salsa rises, what is the effect on the equilibrium price and quantity of taco chips?

Accepted Answer

A) The equilibrium price of taco chips falls and the equilibrium quantity decreases. 
B) The equilibrium price of taco chips rises and the equilibrium quantity decreases. 
C) There is no change in the equilibrium price of taco chips and the equilibrium quantity increases. 
D) The equilibrium price of taco chips could rise, fall, or stay the same and the equilibrium quantity increases. 
E) The equilibrium price of taco chips rises and the equilibrium quantity increases. 
A) The equilibrium price of taco chips falls and the equilibrium quantity decreases. 
B) The equilibrium price of taco chips rises and the equilibrium quantity decreases. 
C) There is no change in the equilibrium price of taco chips and the equilibrium quantity increases. 
D) The equilibrium price of taco chips could rise, fall, or stay the same and the equilibrium quantity increases. 
E) The equilibrium price of taco chips rises and the equilibrium quantity increases.

Question 2

Smart phones are becoming less expensive as new technology reduces the cost of production. In a supply and demand model, explain the effects of the technological innovations and their effect on the quantity of smart phones.

Accepted Answer

Advances in technology increase the supp

Question 3

Both the demand for and supply of cars changes in France. You observe that the quantity of cars does not change but the price rises. Thus, which of the following occurred?

Accepted Answer

A) Demand and supply increased by an equal amount. 
B) Demand and supply decreased by an equal amount. 
C) Demand increased and supply decreased by an equal amount. 
D) Demand decreased and supply increased by an equal amount. 
E) Demand increased by a larger magnitude than supply decreased. 
A) Demand and supply increased by an equal amount. 
B) Demand and supply decreased by an equal amount. 
C) Demand increased and supply decreased by an equal amount. 
D) Demand decreased and supply increased by an equal amount. 
E) Demand increased by a larger magnitude than supply decreased.

Question 4

A demand curve

Accepted Answer

A) has an upward slope. 
B) has a downward slope. 
C) is a graph of the relationship between quantity demanded of a good and its price. 
D) Both answers B and C are correct. 
E) Both answers A and C are correct. 
A) has an upward slope. 
B) has a downward slope. 
C) is a graph of the relationship between quantity demanded of a good and its price. 
D) Both answers B and C are correct. 
E) Both answers A and C are correct.

Question 5

If both supply and demand decrease by the same amount, the equilibrium price

Accepted Answer

A) does not change. 
B) rises. 
C) falls. 
D) cannot be predicted. 
E) None of the answers is correct because the price depends on what happens to the equilibrium quantity. 
A) does not change. 
B) rises. 
C) falls. 
D) cannot be predicted. 
E) None of the answers is correct because the price depends on what happens to the equilibrium quantity.

Question 6

If the price is below the equilibrium price,

Accepted Answer

A) there is a surplus. 
B) there is a shortage. 
C) the supply curve will shift rightward. 
D) the supply curve will shift leftward. 
E) the demand curve will shift leftward. 
A) there is a surplus. 
B) there is a shortage. 
C) the supply curve will shift rightward. 
D) the supply curve will shift leftward. 
E) the demand curve will shift leftward.

Question 7

Which of the following definitely results in a product's equilibrium price rising?

Accepted Answer

A) an increase in both demand and supply 
B) a decrease in both demand and supply 
C) an increase in demand combined with a decrease in supply 
D) a decrease in demand combined with an increase in supply 
E) an increase in the supply combined with no change in the demand 
A) an increase in both demand and supply 
B) a decrease in both demand and supply 
C) an increase in demand combined with a decrease in supply 
D) a decrease in demand combined with an increase in supply 
E) an increase in the supply combined with no change in the demand

Question 8

Autoworkers negotiate a wage increase. How does this change affect the supply curve of cars?

Accepted Answer

A) It shifts the supply curve leftward. 
B) It shifts the supply curve rightward. 
C) It does not shift the supply curve or create a movement along it. 
D) The supply curve will shift but there is not enough information to tell if the change shifts the supply curve rightward, leftward, or not at all. 
E) It creates a movement downward along the supply curve. 
A) It shifts the supply curve leftward. 
B) It shifts the supply curve rightward. 
C) It does not shift the supply curve or create a movement along it. 
D) The supply curve will shift but there is not enough information to tell if the change shifts the supply curve rightward, leftward, or not at all. 
E) It creates a movement downward along the supply curve.

Question 9

If the price of a DVD falls, i. the demand curve for DVDs will shift rightward.
Ii. the demand curve for DVDs will not shift.
Iii. there will be a movement along the demand curve for DVDs.

Accepted Answer

A) i only 
B) ii only 
C) iii only 
D) ii and iii 
E) i and iii 
A) i only 
B) ii only 
C) iii only 
D) ii and iii 
E) i and iii

Question 10

In the above figure, ________ will shift in the demand curve from D to D₁.

Accepted Answer

A) an increase in income if pizza is an inferior good 
B) a decrease in the price of a sub sandwich, a substitute for pizza 
C) buyers' expectation that pizza will be less expensive next week 
D) a scientific article published that demonstrates eating pizza is good for one's health 
E) a fall in the cost of producing pizza 
A) an increase in income if pizza is an inferior good 
B) a decrease in the price of a sub sandwich, a substitute for pizza 
C) buyers' expectation that pizza will be less expensive next week 
D) a scientific article published that demonstrates eating pizza is good for one's health 
E) a fall in the cost of producing pizza

Question 11

If the costs of producing pizza increase, which will occur?

Accepted Answer

A) The supply of pizza will decrease. 
B) The quantity of pizzas supplied will increase as sellers try to cover their costs. 
C) Pizza will cease to be produced and sold. 
D) The demand curve for pizza will shift leftward when the price of a pizza increases. 
E) The demand curve for pizza will shift rightward when the price of a pizza increases. 
A) The supply of pizza will decrease. 
B) The quantity of pizzas supplied will increase as sellers try to cover their costs. 
C) Pizza will cease to be produced and sold. 
D) The demand curve for pizza will shift leftward when the price of a pizza increases. 
E) The demand curve for pizza will shift rightward when the price of a pizza increases.

Question 12

The "law of demand" refers to the fact that, other things remaining the same, when the price of a good rises,

Accepted Answer

A) the demand curve shifts rightward. 
B) the demand curve shifts leftward. 
C) there is a movement down along the demand curve to a larger quantity demanded. 
D) there is a movement up along the demand curve to a smaller quantity demanded. 
E) the demand curve shifts rightward and there is a movement up along the demand curve to a smaller quantity demanded. 
A) the demand curve shifts rightward. 
B) the demand curve shifts leftward. 
C) there is a movement down along the demand curve to a larger quantity demanded. 
D) there is a movement up along the demand curve to a smaller quantity demanded. 
E) the demand curve shifts rightward and there is a movement up along the demand curve to a smaller quantity demanded.

Question 13

As a falling price eliminates a surplus in the jersey market,

Accepted Answer

A) the demand curve for jerseys shifts leftward and the supply curve of jerseys shifts rightward. 
B) consumers increase the quantity of jerseys they demand. 
C) producers increase the quantity of jerseys they supply. 
D) producers decrease the quantity of jerseys they supply and buyers decrease the quantity of jerseys they demand. 
E) the demand curve for jerseys shifts rightward and the supply curve of jerseys shifts leftward. 
A) the demand curve for jerseys shifts leftward and the supply curve of jerseys shifts rightward. 
B) consumers increase the quantity of jerseys they demand. 
C) producers increase the quantity of jerseys they supply. 
D) producers decrease the quantity of jerseys they supply and buyers decrease the quantity of jerseys they demand. 
E) the demand curve for jerseys shifts rightward and the supply curve of jerseys shifts leftward.

Question 14

If the automobile workers' union successfully negotiates a wage increase for its members, how does the wage hike affect the supply of automobiles?

Accepted Answer

A) The supply increases. 
B) The supply decreases. 
C) The quantity supplied increases. 
D) The quantity supplied decreases. 
E) Both answers B and D are correct. 
A) The supply increases. 
B) The supply decreases. 
C) The quantity supplied increases. 
D) The quantity supplied decreases. 
E) Both answers B and D are correct.

Question 15

Which of the following shifts the supply curve of rutabagas rightward? (A rutabaga is a potato-like vegetable.)

Accepted Answer

A) an increase in the price of a rutabaga 
B) an exceptionally cold summer that killed much of the rutabaga crop 
C) a fall in the price of fertilizer used to grow rutabagas 
D) Both answers A and C shift the supply curve of rutabagas rightward. 
E) Both answers A and B shift the supply curve of rutabagas rightward. 
A) an increase in the price of a rutabaga 
B) an exceptionally cold summer that killed much of the rutabaga crop 
C) a fall in the price of fertilizer used to grow rutabagas 
D) Both answers A and C shift the supply curve of rutabagas rightward. 
E) Both answers A and B shift the supply curve of rutabagas rightward.

Question 16

Market equilibrium i. can never occur because there are always people who want a good but cannot afford it.
Ii. occurs at the intersection of the supply and demand curves.
Iii. is the point where the price equals the quantity.

Accepted Answer

A) ii only 
B) iii only 
C) ii and iii 
D) i only 
E) i and ii 
A) ii only 
B) iii only 
C) ii and iii 
D) i only 
E) i and ii

Question 17

Market demand curves are obtained by

Accepted Answer

A) determining the price each consumer is willing to pay for the good and summing those prices across all consumers. 
B) observing the prices and quantities sold in a market over time and plotting those price-quantity combinations in a graph. 
C) summing the quantities every consumer is willing to buy at each different price. 
D) observing the behavior of an individual consumer in a market. 
E) averaging the quantities every consumer is willing to buy at each different price. 
A) determining the price each consumer is willing to pay for the good and summing those prices across all consumers. 
B) observing the prices and quantities sold in a market over time and plotting those price-quantity combinations in a graph. 
C) summing the quantities every consumer is willing to buy at each different price. 
D) observing the behavior of an individual consumer in a market. 
E) averaging the quantities every consumer is willing to buy at each different price.

Question 18

-In the figure above, if the price is $8 a unit, is there a shortage or surplus and what is the amount of any shortage or surplus?

Accepted Answer

At a price of $8 there is a su

Question 19

-The graph illustrates the supply of sweaters. As the technology used to produce sweaters improves, the

Accepted Answer

A) supply of sweaters decreases and the demand for sweaters does not change. 
B) supply of sweaters increases and the demand for sweaters does not change. 
C) quantity of sweaters supplied increases. 
D) quantity of sweaters supplied decreases. 
E) supply of sweaters increases and the demand for sweaters increases. 
A) supply of sweaters decreases and the demand for sweaters does not change. 
B) supply of sweaters increases and the demand for sweaters does not change. 
C) quantity of sweaters supplied increases. 
D) quantity of sweaters supplied decreases. 
E) supply of sweaters increases and the demand for sweaters increases.

Question 20

An increase in the quantity demanded is shown as a

Accepted Answer

A) movement along the demand curve. 
B) movement toward the demand curve. 
C) rightward shift of the demand curve. 
D) leftward shift of the demand curve. 
E) both a movement along the demand curve and a shift of the demand curve. 
A) movement along the demand curve. 
B) movement toward the demand curve. 
C) rightward shift of the demand curve. 
D) leftward shift of the demand curve. 
E) both a movement along the demand curve and a shift of the demand curve.

For consumers, taco chips and salsa are complements. If the price of salsa rises, what is the effect on the equilibrium price and quantity of taco chips?

Smart phones are becoming less expensive as new technology reduces the cost of production. In a supply and demand model, explain the effects of the technological innovations and their effect on the quantity of smart phones.

Both the demand for and supply of cars changes in France. You observe that the quantity of cars does not change but the price rises. Thus, which of the following occurred?

A demand curve

If both supply and demand decrease by the same amount, the equilibrium price

If the price is below the equilibrium price,

Which of the following definitely results in a product's equilibrium price rising?

Autoworkers negotiate a wage increase. How does this change affect the supply curve of cars?

If the price of a DVD falls, i. the demand curve for DVDs will shift rightward. Ii. the demand curve for DVDs will not shift. Iii. there will be a movement along the demand curve for DVDs.

In the above figure, ________ will shift in the demand curve from D to D₁.

If the costs of producing pizza increase, which will occur?

The "law of demand" refers to the fact that, other things remaining the same, when the price of a good rises,

As a falling price eliminates a surplus in the jersey market,

If the automobile workers' union successfully negotiates a wage increase for its members, how does the wage hike affect the supply of automobiles?

Which of the following shifts the supply curve of rutabagas rightward? (A rutabaga is a potato-like vegetable.)

Market equilibrium i. can never occur because there are always people who want a good but cannot afford it. Ii. occurs at the intersection of the supply and demand curves. Iii. is the point where the price equals the quantity.

Market demand curves are obtained by

-In the figure above, if the price is $8 a unit, is there a shortage or surplus and what is the amount of any shortage or surplus?

-The graph illustrates the supply of sweaters. As the technology used to produce sweaters improves, the

An increase in the quantity demanded is shown as a

Getting Started

The Us and Global Economies

The Economic Problem

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Global Markets in Action

Externalities: Pollution, Education, and Health Care

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and Economic Growth

Money and the Monetary System

Aggregate Supply and Aggregate Demand

Fiscal Policy and Monetary Policy

Filters

Exam 4: Demand and Supply

For consumers, taco chips and salsa are complements. If the price of salsa rises, what is the effect on the equilibrium price and quantity of taco chips?

Smart phones are becoming less expensive as new technology reduces the cost of production. In a supply and demand model, explain the effects of the technological innovations and their effect on the quantity of smart phones.

Both the demand for and supply of cars changes in France. You observe that the quantity of cars does not change but the price rises. Thus, which of the following occurred?

A demand curve

If both supply and demand decrease by the same amount, the equilibrium price

If the price is below the equilibrium price,

Which of the following definitely results in a product's equilibrium price rising?

Autoworkers negotiate a wage increase. How does this change affect the supply curve of cars?

If the price of a DVD falls, i. the demand curve for DVDs will shift rightward. Ii. the demand curve for DVDs will not shift. Iii. there will be a movement along the demand curve for DVDs.

In the above figure, ________ will shift in the demand curve from D to D₁.

If the costs of producing pizza increase, which will occur?

The "law of demand" refers to the fact that, other things remaining the same, when the price of a good rises,

As a falling price eliminates a surplus in the jersey market,

If the automobile workers' union successfully negotiates a wage increase for its members, how does the wage hike affect the supply of automobiles?

Which of the following shifts the supply curve of rutabagas rightward? (A rutabaga is a potato-like vegetable.)

Market equilibrium i. can never occur because there are always people who want a good but cannot afford it. Ii. occurs at the intersection of the supply and demand curves. Iii. is the point where the price equals the quantity.

Market demand curves are obtained by

-In the figure above, if the price is $8 a unit, is there a shortage or surplus and what is the amount of any shortage or surplus?

-The graph illustrates the supply of sweaters. As the technology used to produce sweaters improves, the

An increase in the quantity demanded is shown as a

Getting Started

The Us and Global Economies

The Economic Problem

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Global Markets in Action

Externalities: Pollution, Education, and Health Care

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and Economic Growth

Money and the Monetary System

Aggregate Supply and Aggregate Demand

Fiscal Policy and Monetary Policy

Filters