Question 1

A demand curve for The Steel Porcupines' concert tickets would show the:

Accepted Answer

A)  number of tickets the box office is willing to sell at various prices. 
B)  number of people who need tickets. 
C)  quality of people who want to buy these concert tickets. 
D)  number of tickets that will be purchased at various prices. 
A)  number of tickets the box office is willing to sell at various prices. 
B)  number of people who need tickets. 
C)  quality of people who want to buy these concert tickets. 
D)  number of tickets that will be purchased at various prices.

Question 2

A curve that depicts the relationship between price and quantity demanded is the:

Accepted Answer

A)  supply curve. 
B)  supply schedule. 
C)  demand curve. 
D)  equilibrium price. 
A)  supply curve. 
B)  supply schedule. 
C)  demand curve. 
D)  equilibrium price.

Question 3

If consumer tastes are changing more in favor of the consumption of a particular good the:

Accepted Answer

A)  market demand curve will shift to the left. 
B)  consumer will move up a given demand curve, decreasing the quantity demanded. 
C)  consumer would move down a given demand curve, decreasing the quantity demanded. 
D)  consumer would move down a given demand curve, increasing the quantity demanded. 
E)  market demand curve would shift to the right. 
A)  market demand curve will shift to the left. 
B)  consumer will move up a given demand curve, decreasing the quantity demanded. 
C)  consumer would move down a given demand curve, decreasing the quantity demanded. 
D)  consumer would move down a given demand curve, increasing the quantity demanded. 
E)  market demand curve would shift to the right.

Question 4

A reduction in production costs will result in a(n):

Accepted Answer

A)  rightward shift of the supply curve. 
B)  increase in supply. 
C)  greater willingness and ability of producers to supply a larger quantity at any given price. 
D)  greater willingness and ability of producers to supply the same quantity at a lower price. 
E)  all of the above. 
A)  rightward shift of the supply curve. 
B)  increase in supply. 
C)  greater willingness and ability of producers to supply a larger quantity at any given price. 
D)  greater willingness and ability of producers to supply the same quantity at a lower price. 
E)  all of the above.

Question 5

Which of the following has a direct relationship rather than an inverse relationship with the supply curve?

Accepted Answer

A)  The number of sellers. 
B)  Resource prices. 
C)  Consumer income. 
D)  Prices of other goods that firms could produce. 
A)  The number of sellers. 
B)  Resource prices. 
C)  Consumer income. 
D)  Prices of other goods that firms could produce.

Question 6

Assuming compact discs and cassettes are substitute goods,a decrease in the price of cassettes will cause the demand curve for compact discs to:

Accepted Answer

A)  shift to the left as consumers switch from buying discs to cassettes. 
B)  shift to the right as consumers switch from buying discs to cassettes. 
C)  shift to the left as producers increase cassette production and reduce disc production. 
D)  remain unchanged since discs and cassettes are sold in separate markets. 
A)  shift to the left as consumers switch from buying discs to cassettes. 
B)  shift to the right as consumers switch from buying discs to cassettes. 
C)  shift to the left as producers increase cassette production and reduce disc production. 
D)  remain unchanged since discs and cassettes are sold in separate markets.

Question 7

Exhibit 3-4 Supply curves
  
-In Exhibit 3-4,a shift in the supply curve from S₁ to S₂ represents a(n):

Accepted Answer

A)  decrease in supply. 
B)  decrease in the quantity supplied. 
C)  increase in supply. 
D)  increase in the quantity supplied. 
E)  increase in demand. 
A)  decrease in supply. 
B)  decrease in the quantity supplied. 
C)  increase in supply. 
D)  increase in the quantity supplied. 
E)  increase in demand.

Question 8

Other things being equal,the effects of a decrease in the price of orange juice,is represented by which of the following?

Accepted Answer

A)  A rightward shift in the demand curve for orange juice. 
B)  An increase in the quantity demanded for orange juice. 
C)  A leftward shift in the demand curve for orange juice. 
D)  A decrease in the quantity demanded orange juice. 
A)  A rightward shift in the demand curve for orange juice. 
B)  An increase in the quantity demanded for orange juice. 
C)  A leftward shift in the demand curve for orange juice. 
D)  A decrease in the quantity demanded orange juice.

Question 9

If consumer incomes go up and Harley Davidson motorcycles are a normal good,the effect on the demand for motorcycles,ceteris paribus,will be a(n):

Accepted Answer

A)  upward movement along the demand curve for motorcycles. 
B)  downward movement along the demand curve for motorcycles. 
C)  rightward shift in the demand curve for motorcycles. 
D)  leftward shift in the demand curve for motorcycles. 
A)  upward movement along the demand curve for motorcycles. 
B)  downward movement along the demand curve for motorcycles. 
C)  rightward shift in the demand curve for motorcycles. 
D)  leftward shift in the demand curve for motorcycles.

Question 10

Demand for a good will always rise when:

Accepted Answer

A)  the price of a complementary good falls. 
B)  the price of a substitute good falls. 
C)  tastes change. 
D)  incomes decrease. 
E)  the price of the good falls. 
A)  the price of a complementary good falls. 
B)  the price of a substitute good falls. 
C)  tastes change. 
D)  incomes decrease. 
E)  the price of the good falls.

Question 11

Exhibit 3-3 Demand curves
  
-Assume that consumers expect the price of gasoline to rise sharply in the future.Which of the graphs in Exhibit 3-3 depicts this effect?

Accepted Answer

A)  Graph A. 
B)  Graph B. 
C)  Graph C. 
D)  Graph D. 
A)  Graph A. 
B)  Graph B. 
C)  Graph C. 
D)  Graph D.

Question 12

Which of the following would increase the supply of laptop computers?

Accepted Answer

A)  Higher wage rates for the workers that produce laptop computers. 
B)  A technological improvement that lowers the cost of producing laptop computers. 
C)  An increase in the price of computer chips used to produce laptop computers. 
D)  All of the above. 
A)  Higher wage rates for the workers that produce laptop computers. 
B)  A technological improvement that lowers the cost of producing laptop computers. 
C)  An increase in the price of computer chips used to produce laptop computers. 
D)  All of the above.

Question 13

A normal good is defined by economists to be a good:

Accepted Answer

A)  with a negatively-sloped demand curve. 
B)  that is purchased by at least 75 percent of the population. 
C)  that is bought by consumers with normal tastes. 
D)  whose demand increases when incomes increase. 
E)  whose demand decreases when incomes increase. 
A)  with a negatively-sloped demand curve. 
B)  that is purchased by at least 75 percent of the population. 
C)  that is bought by consumers with normal tastes. 
D)  whose demand increases when incomes increase. 
E)  whose demand decreases when incomes increase.

Question 14

Assuming that soybeans and tobacco can both be grown on the same land,a decrease in the price of tobacco,other things being equal,causes a(n):

Accepted Answer

A)  rightward shift of the supply curve for tobacco. 
B)  upward movement along the supply curve for soybeans. 
C)  rightward shift in the supply curve for soybeans. 
D)  leftward shift in the supply curve for soybeans. 
A)  rightward shift of the supply curve for tobacco. 
B)  upward movement along the supply curve for soybeans. 
C)  rightward shift in the supply curve for soybeans. 
D)  leftward shift in the supply curve for soybeans.

Question 15

If an individual's income increases,then the demand for a normal good will:

Accepted Answer

A)  decrease. 
B)  increase. 
C)  remain constant. 
D)  rotate. 
E)  fall to zero. 
A)  decrease. 
B)  increase. 
C)  remain constant. 
D)  rotate. 
E)  fall to zero.

Question 16

The law of demand refers to the:

Accepted Answer

A)  tendency of prices to increase as more units of a product are demanded. 
B)  increase in price that results from an increase in demand for a good with a limited supply. 
C)  inverse relationship between the price of a good and the quantity of the good demanded. 
D)  increase in the quantity of a good available as the price of the good increases. 
A)  tendency of prices to increase as more units of a product are demanded. 
B)  increase in price that results from an increase in demand for a good with a limited supply. 
C)  inverse relationship between the price of a good and the quantity of the good demanded. 
D)  increase in the quantity of a good available as the price of the good increases.

Question 17

Assuming that Pepsi-Cola and Coca-Cola are substitutes,a rise in the price of Pepsi-Cola,other things being equal,results in a(n):

Accepted Answer

A)  upward movement along the demand curve for Coca-Cola. 
B)  downward movement along the demand curve for Coca-Cola. 
C)  leftward shift in the demand curve for Coca-Cola. 
D)  rightward shift in the demand curve for Coca-Cola. 
A)  upward movement along the demand curve for Coca-Cola. 
B)  downward movement along the demand curve for Coca-Cola. 
C)  leftward shift in the demand curve for Coca-Cola. 
D)  rightward shift in the demand curve for Coca-Cola.

Question 18

If a decrease in price of good X causes the demand curve for good Y to increase,then these two goods are:

Accepted Answer

A)  normal goods. 
B)  complementary goods. 
C)  substitute goods. 
D)  equilibrium goods. 
E)  market-day goods. 
A)  normal goods. 
B)  complementary goods. 
C)  substitute goods. 
D)  equilibrium goods. 
E)  market-day goods.

Question 19

If the price of potato chips increases,other things constant,demand for potato-chip dip will:

Accepted Answer

A)  not change; only quantity demanded will change. 
B)  increase, because the goods are substitutes. 
C)  decrease, because the goods are substitutes. 
D)  decrease, because the goods are complements. 
E)  increase, because the goods are complements. 
A)  not change; only quantity demanded will change. 
B)  increase, because the goods are substitutes. 
C)  decrease, because the goods are substitutes. 
D)  decrease, because the goods are complements. 
E)  increase, because the goods are complements.

Question 20

Which of the following would decrease the supply of airline travel?

Accepted Answer

A)  Reduced number of airline travelers. 
B)  New airline companies beginning operations. 
C)  Higher fuel costs. 
D)  Lower prices for airline tickets. 
A)  Reduced number of airline travelers. 
B)  New airline companies beginning operations. 
C)  Higher fuel costs. 
D)  Lower prices for airline tickets.

Exam 3: Part 1: Market Demand and Supply

A demand curve for The Steel Porcupines' concert tickets would show the:

A curve that depicts the relationship between price and quantity demanded is the:

If consumer tastes are changing more in favor of the consumption of a particular good the:

A reduction in production costs will result in a(n):

Which of the following has a direct relationship rather than an inverse relationship with the supply curve?

Assuming compact discs and cassettes are substitute goods,a decrease in the price of cassettes will cause the demand curve for compact discs to:

Exhibit 3-4 Supply curves -In Exhibit 3-4,a shift in the supply curve from S₁ to S₂ represents a(n):

Other things being equal,the effects of a decrease in the price of orange juice,is represented by which of the following?

If consumer incomes go up and Harley Davidson motorcycles are a normal good,the effect on the demand for motorcycles,ceteris paribus,will be a(n):

Demand for a good will always rise when:

Exhibit 3-3 Demand curves -Assume that consumers expect the price of gasoline to rise sharply in the future.Which of the graphs in Exhibit 3-3 depicts this effect?

Which of the following would increase the supply of laptop computers?

A normal good is defined by economists to be a good:

Assuming that soybeans and tobacco can both be grown on the same land,a decrease in the price of tobacco,other things being equal,causes a(n):

If an individual's income increases,then the demand for a normal good will:

The law of demand refers to the:

Assuming that Pepsi-Cola and Coca-Cola are substitutes,a rise in the price of Pepsi-Cola,other things being equal,results in a(n):

If a decrease in price of good X causes the demand curve for good Y to increase,then these two goods are:

If the price of potato chips increases,other things constant,demand for potato-chip dip will:

Which of the following would decrease the supply of airline travel?

Introducing the Economic Way of Thinking

A: Appendix: Applying Graphs to Economics

Production Possibilities,Opportunity Cost,and Economic Growth

Part 2: Market Demand and Supply

Markets in Action

Price Elasticity of Demand

Production Costs

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Labor Markets and Income Distribution

Gross Domestic Product

Business Cycles and Unemployment

Inflation

Aggregate Demand and Supply

A: Appendix: The Self-Correcting Aggregate Demand and Supply Model

Fiscal Policy

The Public Sector

Federal Deficits,Surpluses,and the National Debt

Money and the Federal Reserve System

Money Creation

Monetary Policy

A: Appendix: Policy Disputes Using the Self-Correcting Aggregate Demand and Supply Model

International Trade and Finance

Economies in Transition

Growth and the Less-Developed Countries

Filters