Question 1

If the market demand curve shifts sharply to the left as the market supply curve moves to the right, we would expect:

Accepted Answer

A) the same price to prevail, with no change in quantity. 
B) the same quantity to prevail. 
C) price and quantity to fall. 
D) price to fall while quantity may or may not change. 
E) quantity to fall while price may or may not change. 
A) the same price to prevail, with no change in quantity. 
B) the same quantity to prevail. 
C) price and quantity to fall. 
D) price to fall while quantity may or may not change. 
E) quantity to fall while price may or may not change.

Question 2

The quantity of some good X demanded by individuals typically depends upon their incomes and preferences.

Accepted Answer

A) True 
 B)False

Question 3

Letting the price of oil rise will likely reduce quantity demanded and increase quantity supplied.

Accepted Answer

A) True 
 B)False

Question 4

The market clearing price in a competitive market:

Accepted Answer

A) is one that will be established immediately when buyers and sellers come together to the market. 
B) would persist if actually reached, but doesn't have much significance in real life, due to the lack of any forces tending to push the price to this level. 
C) has no significance at all in real life because analysis of competitive markets takes no account of incomes, tastes, or other factors that influence demand. 
D) will tend to be reached, although not necessarily immediately, because of the competitive forces set up whenever price is at any level other than equilibrium. 
E) has no application except where everyone is an "economic person" (homo economicus). 
A) is one that will be established immediately when buyers and sellers come together to the market. 
B) would persist if actually reached, but doesn't have much significance in real life, due to the lack of any forces tending to push the price to this level. 
C) has no significance at all in real life because analysis of competitive markets takes no account of incomes, tastes, or other factors that influence demand. 
D) will tend to be reached, although not necessarily immediately, because of the competitive forces set up whenever price is at any level other than equilibrium. 
E) has no application except where everyone is an "economic person" (homo economicus).

Question 5

Advertising a product is an attempt by the advertisers to cause people to move down their demand curves.

Accepted Answer

A) True 
 B)False

Question 6

Use the following to answer questions :
Table 3-1  
-The data in Table 3-1:

Accepted Answer

A) support the law of demand. 
B) indicate that the supply curve is vertical. 
C) contradict economic reasoning. 
D) both b and c. 
E) none of the above. 
A) support the law of demand. 
B) indicate that the supply curve is vertical. 
C) contradict economic reasoning. 
D) both b and c. 
E) none of the above.

Question 7

If farmers work harder and longer to maintain their incomes and living standards as their earnings per hour fall, that would involve:

Accepted Answer

A) an exception to the downward slope of the demand curve for labor. 
B) an exception to the upward slope of the supply curve for labor. 
C) a confirmation of the downward slope of the supply curve for labor. 
D) a confirmation of the upward slope of the supply curve for labor. 
E) none of the above. 
A) an exception to the downward slope of the demand curve for labor. 
B) an exception to the upward slope of the supply curve for labor. 
C) a confirmation of the downward slope of the supply curve for labor. 
D) a confirmation of the upward slope of the supply curve for labor. 
E) none of the above.

Question 8

One reason that the quantity demanded of a good tends to rise as its price falls is that:

Accepted Answer

A) the decrease in price shifts the supply curve downward. 
B) people feel a bit richer and increase their use of the good. 
C) demand has to rise to restore equilibrium after a price reduction. 
D) suppliers are willing to supply more at lower prices. 
E) the decrease in price shifts the demand curve upward. 
A) the decrease in price shifts the supply curve downward. 
B) people feel a bit richer and increase their use of the good. 
C) demand has to rise to restore equilibrium after a price reduction. 
D) suppliers are willing to supply more at lower prices. 
E) the decrease in price shifts the demand curve upward.

Question 9

A shortage of OPEC oil at current market prices will increase oil prices because of:

Accepted Answer

A) the law of elastic supply. 
B) the law of elastic demand. 
C) consumers will bid up the price of oil. 
D) all of the above. 
E) none of the above. 
A) the law of elastic supply. 
B) the law of elastic demand. 
C) consumers will bid up the price of oil. 
D) all of the above. 
E) none of the above.

Question 10

The quantity of good X demanded by an individual may depend upon:

Accepted Answer

A) the individual's income. 
B) the price of X. 
C) the price of some other goods. 
D) all of the above. 
E) answers a and b, only. 
A) the individual's income. 
B) the price of X. 
C) the price of some other goods. 
D) all of the above. 
E) answers a and b, only.

Question 11

If you were a government official and wanted to raise the price of oil, which of the following actions would you take?

Accepted Answer

A) Take oil from government storage and sell it on the open market. 
B) Encourage producers to drill more wells. 
C) Try to lower the price of alternative fuels. 
D) Try to lower average family income. 
E) Encourage producers to cut back on drilling for oil. 
A) Take oil from government storage and sell it on the open market. 
B) Encourage producers to drill more wells. 
C) Try to lower the price of alternative fuels. 
D) Try to lower average family income. 
E) Encourage producers to cut back on drilling for oil.

Question 12

To say that a price "clears the market" is to say that everyone who wants that commodity is getting all they want.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following could affect a demand schedule for petroleum products?

Accepted Answer

A) A change in the technology of oil production. 
B) The discovery of new oil fields in Texas. 
C) A strike by oil refinery workers. 
D) An increase in national income. 
E) None of the above. 
A) A change in the technology of oil production. 
B) The discovery of new oil fields in Texas. 
C) A strike by oil refinery workers. 
D) An increase in national income. 
E) None of the above.

Question 14

Use the following to answer questions :
Table 3-1  
-According to Table 3-1, the equilibrium price for potato chips is:

Accepted Answer

A) $1.00. 
B) $2.00. 
C) $2.50. 
D) $3.00. 
E) $4.00. 
A) $1.00. 
B) $2.00. 
C) $2.50. 
D) $3.00. 
E) $4.00.

Question 15

If the price of bacon rose because of a poor hog season, then the price and quantity of eggs would be likely to increase (other things being equal).

Accepted Answer

A) True 
 B)False

Question 16

In New York City, an influx of immigrants could be expected to increase the supply of low-wage workers and increase wages.

Accepted Answer

A) True 
 B)False

Question 17

Over time the fact that some people buy less hamburger at 69 cents per pound than at 89 cents per pound refutes the law of downward-sloping demand.

Accepted Answer

A) True 
 B)False

Question 18

A shift in supply to the right means that people will produce more at each price indicated.

Accepted Answer

A) True 
 B)False

Question 19

Over time the fact that some people buy more hamburger at 89 cents per pound than at 69 cents per pound refutes the law of downward-sloping demand.

Accepted Answer

A) True 
 B)False

Question 20

The quantity of some good X demanded by individuals hardly ever depends upon the prices of other goods.

Accepted Answer

A) True 
 B)False

If the market demand curve shifts sharply to the left as the market supply curve moves to the right, we would expect:

The quantity of some good X demanded by individuals typically depends upon their incomes and preferences.

Letting the price of oil rise will likely reduce quantity demanded and increase quantity supplied.

The market clearing price in a competitive market:

Advertising a product is an attempt by the advertisers to cause people to move down their demand curves.

Use the following to answer questions : Table 3-1 -The data in Table 3-1:

If farmers work harder and longer to maintain their incomes and living standards as their earnings per hour fall, that would involve:

One reason that the quantity demanded of a good tends to rise as its price falls is that:

A shortage of OPEC oil at current market prices will increase oil prices because of:

The quantity of good X demanded by an individual may depend upon:

If you were a government official and wanted to raise the price of oil, which of the following actions would you take?

To say that a price "clears the market" is to say that everyone who wants that commodity is getting all they want.

Which of the following could affect a demand schedule for petroleum products?

Use the following to answer questions : Table 3-1 -According to Table 3-1, the equilibrium price for potato chips is:

If the price of bacon rose because of a poor hog season, then the price and quantity of eggs would be likely to increase (other things being equal).

In New York City, an influx of immigrants could be expected to increase the supply of low-wage workers and increase wages.

Over time the fact that some people buy less hamburger at 69 cents per pound than at 89 cents per pound refutes the law of downward-sloping demand.

A shift in supply to the right means that people will produce more at each price indicated.

Over time the fact that some people buy more hamburger at 89 cents per pound than at 69 cents per pound refutes the law of downward-sloping demand.

The quantity of some good X demanded by individuals hardly ever depends upon the prices of other goods.

The Central Concepts of Economics

The Modern Mixed Economy

Supply and Demand: Elasticity and Applications

Demand and Consumer Behavior

Production and Business Organization

Analysis of Costs

Analysis of Perfectly Competitive Markets

Imperfect Competition and Monopoly

Competition Among the Few

Economics of Uncertainty

The Labor Market

Land, Natural Resources, and the Environment

Capital, Interest, and Profits Part Four: Applications of Economic Principles

Government Taxation and Expenditure

Efficiency Vsequality: The Big Trade-Off

International Trade

Overview of Macroeconomics

Geometrical Analysis of Consumer Equilibrium

Production Cost Theory and Decisions of the Firm

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Exam 3: Basic Elements of Supply and Demand Part

If the market demand curve shifts sharply to the left as the market supply curve moves to the right, we would expect:

The quantity of some good X demanded by individuals typically depends upon their incomes and preferences.

Letting the price of oil rise will likely reduce quantity demanded and increase quantity supplied.

The market clearing price in a competitive market:

Advertising a product is an attempt by the advertisers to cause people to move down their demand curves.

Use the following to answer questions : Table 3-1 -The data in Table 3-1:

If farmers work harder and longer to maintain their incomes and living standards as their earnings per hour fall, that would involve:

One reason that the quantity demanded of a good tends to rise as its price falls is that:

A shortage of OPEC oil at current market prices will increase oil prices because of:

The quantity of good X demanded by an individual may depend upon:

If you were a government official and wanted to raise the price of oil, which of the following actions would you take?

To say that a price "clears the market" is to say that everyone who wants that commodity is getting all they want.

Which of the following could affect a demand schedule for petroleum products?

Use the following to answer questions : Table 3-1 -According to Table 3-1, the equilibrium price for potato chips is:

If the price of bacon rose because of a poor hog season, then the price and quantity of eggs would be likely to increase (other things being equal).

In New York City, an influx of immigrants could be expected to increase the supply of low-wage workers and increase wages.

Over time the fact that some people buy less hamburger at 69 cents per pound than at 89 cents per pound refutes the law of downward-sloping demand.

A shift in supply to the right means that people will produce more at each price indicated.

Over time the fact that some people buy more hamburger at 89 cents per pound than at 69 cents per pound refutes the law of downward-sloping demand.

The quantity of some good X demanded by individuals hardly ever depends upon the prices of other goods.

The Central Concepts of Economics

The Modern Mixed Economy

Supply and Demand: Elasticity and Applications

Demand and Consumer Behavior

Production and Business Organization

Analysis of Costs

Analysis of Perfectly Competitive Markets

Imperfect Competition and Monopoly

Competition Among the Few

Economics of Uncertainty

The Labor Market

Land, Natural Resources, and the Environment

Capital, Interest, and Profits Part Four: Applications of Economic Principles

Government Taxation and Expenditure

Efficiency Vsequality: The Big Trade-Off

International Trade

Overview of Macroeconomics

Geometrical Analysis of Consumer Equilibrium

Production Cost Theory and Decisions of the Firm

Filters