Question 1

A change in which of the following will not alter the demand curve for rental housing?

Accepted Answer

A) The price of houses. 
B) Rental prices. 
C) Incomes of consumers. 
D) Energy prices. 
E) Growth in the community. 
A) The price of houses. 
B) Rental prices. 
C) Incomes of consumers. 
D) Energy prices. 
E) Growth in the community.

Question 2

Use the following to answer questions :
Table 3-1  
-According to Table 3-1, for every $1.00 increase in price, the quantity demanded decreases by:

Accepted Answer

A) 5. 
B) 500. 
C) 10. 
D) 25. 
E) 250. 
A) 5. 
B) 500. 
C) 10. 
D) 25. 
E) 250.

Question 3

If E were the old equilibrium in the wheat market depicted in the figure below and E' were the new one, which of the following might have caused the change?

Accepted Answer

A) Good weather caused a supply shift. 
B) Good weather caused a demand shift. 
C) Bad weather caused a supply shift. 
D) Bad weather caused a demand shift. 
E) Consumer incomes changed, causing a supply shift. 
A) Good weather caused a supply shift. 
B) Good weather caused a demand shift. 
C) Bad weather caused a supply shift. 
D) Bad weather caused a demand shift. 
E) Consumer incomes changed, causing a supply shift.

Question 4

An increase in demand means a movement to a higher quantity along a given demand curve.

Accepted Answer

A) True 
 B)False

Question 5

A shift in demand to the right means that people want to buy less at each price.

Accepted Answer

A) True 
 B)False

Question 6

Use the following to answer questions :
Figure 3-5  
-Point C in Figure 3-5 could represent:

Accepted Answer

A) a point on the demand schedule for a normal good with higher incomes. 
B) an equilibrium point. 
C) a point on the supply schedule. 
D) both a and c. 
E) none of the above. 
A) a point on the demand schedule for a normal good with higher incomes. 
B) an equilibrium point. 
C) a point on the supply schedule. 
D) both a and c. 
E) none of the above.

Question 7

A surplus in supply means that demanders are not willing to pay the current market price.

Accepted Answer

A) True 
 B)False

Question 8

Use the following to answer questions :
Figure 3-2  
-Let P* and Q* in Figure 3-2 represent market clearing price and quantity, respectively, of good Q.Given the supply and demand curves drawn in Figure 3-2, a reduction in the price of a substitute good for Q will cause:

Accepted Answer

A) P* and Q* to climb. 
B) P* to climb while Q* declines. 
C) P* to climb while Q* holds fixed. 
D) P* to fall while Q* climbs. 
E) P* and Q* to fall. 
A) P* and Q* to climb. 
B) P* to climb while Q* declines. 
C) P* to climb while Q* holds fixed. 
D) P* to fall while Q* climbs. 
E) P* and Q* to fall.

Question 9

An increase in price will lead to a lower quantity demanded because:

Accepted Answer

A) suppliers will supply only the smaller amount. 
B) quality deteriorates. 
C) people will purchase less of the good. 
D) all of the above. 
E) none of the above. 
A) suppliers will supply only the smaller amount. 
B) quality deteriorates. 
C) people will purchase less of the good. 
D) all of the above. 
E) none of the above.

Question 10

The position of the supply schedule for American-made cars will not be directly affected by which of the following?

Accepted Answer

A) Union wage rates. 
B) Car prices. 
C) The price of tires. 
D) A change in assembly technology. 
E) All of the above will affect supply. 
A) Union wage rates. 
B) Car prices. 
C) The price of tires. 
D) A change in assembly technology. 
E) All of the above will affect supply.

Question 11

The demand curve for a normal good will shift to the left if:

Accepted Answer

A) income increases. 
B) population increases 
C) the price of a substitute good decreases. 
D) all the above. 
E) none of the above. 
A) income increases. 
B) population increases 
C) the price of a substitute good decreases. 
D) all the above. 
E) none of the above.

Question 12

Market equilibrium comes at the price which quantity demanded equals quantity supplied.

Accepted Answer

A) True 
 B)False

Question 13

A change in tastes can cause people to move down their demand curve, unlike an increase in income, which will cause the demand curve to shift.

Accepted Answer

A) True 
 B)False

Question 14

Use the following to answer questions :
Figure 3-6  
-Given the supply and demand curves drawn in Figure 3-6, a technological advance that makes the production of Q more efficient can be expected to push the market clearing price down and the market clearing quantity up.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following does not explain why supply curves typically slope upward and to the right:

Accepted Answer

A) people are willing to pay a higher price for more goods. 
B) extra production brings in the less efficient, higher-cost producers. 
C) expanded industry output might cause a labor shortage and subsequently a rise in the wage rate and the cost of production. 
D) expanded production may require the use of inferior resources. 
E) All the above are valid reasons. 
A) people are willing to pay a higher price for more goods. 
B) extra production brings in the less efficient, higher-cost producers. 
C) expanded industry output might cause a labor shortage and subsequently a rise in the wage rate and the cost of production. 
D) expanded production may require the use of inferior resources. 
E) All the above are valid reasons.

Question 16

Use the following to answer questions :
Figure 3-1  
-Given the supply and demand curves drawn for a normal good in Figure 3-1, an increase in income can be expected to cause:

Accepted Answer

A) equilibrium price and quantity to increase. 
B) equilibrium price to increase and equilibrium quantity to fall. 
C) equilibrium price to increase while equilibrium quantity holds steady. 
D) equilibrium price and quantity to fall. 
E) equilibrium price to fall and equilibrium quantity to climb. 
A) equilibrium price and quantity to increase. 
B) equilibrium price to increase and equilibrium quantity to fall. 
C) equilibrium price to increase while equilibrium quantity holds steady. 
D) equilibrium price and quantity to fall. 
E) equilibrium price to fall and equilibrium quantity to climb.

Question 17

If the demand schedule may be written P = 100 - 4Q, and the supply schedule P = 40 + 2Q, then the market clearing price and quantity are:

Accepted Answer

A) P = 60, Q = 10. 
B) P = 10, Q = 6. 
C) P = 40, Q = 6. 
D) P = 20, Q = 20. 
E) none of the above. 
A) P = 60, Q = 10. 
B) P = 10, Q = 6. 
C) P = 40, Q = 6. 
D) P = 20, Q = 20. 
E) none of the above.

Question 18

The quantity of labor demanded by an employer typically depends upon the wage that labor is paid.

Accepted Answer

A) True 
 B)False

Question 19

A fixed supply of apartments can be rationed out by letting market forces establish the market clearing competitive rent rate.

Accepted Answer

A) True 
 B)False

Question 20

When we say that a price in a competitive market is "too low to clear the market," we usually mean that:

Accepted Answer

A) the quantity supplied exceeds the quantity demanded at that price, so there is too much competition among producers to try to get rid of that supply. 
B) consumers are not willing to buy enough at that price. 
C) producers are leaving the industry. 
D) the quantity demanded exceeds the quantity supplied at that price. 
E) no producer can cover costs of production at that price. 
A) the quantity supplied exceeds the quantity demanded at that price, so there is too much competition among producers to try to get rid of that supply. 
B) consumers are not willing to buy enough at that price. 
C) producers are leaving the industry. 
D) the quantity demanded exceeds the quantity supplied at that price. 
E) no producer can cover costs of production at that price.

A change in which of the following will not alter the demand curve for rental housing?

Use the following to answer questions : Table 3-1 -According to Table 3-1, for every $1.00 increase in price, the quantity demanded decreases by:

If E were the old equilibrium in the wheat market depicted in the figure below and E' were the new one, which of the following might have caused the change?

An increase in demand means a movement to a higher quantity along a given demand curve.

A shift in demand to the right means that people want to buy less at each price.

Use the following to answer questions : Figure 3-5 -Point C in Figure 3-5 could represent:

A surplus in supply means that demanders are not willing to pay the current market price.

Use the following to answer questions : Figure 3-2 -Let P* and Q* in Figure 3-2 represent market clearing price and quantity, respectively, of good Q.Given the supply and demand curves drawn in Figure 3-2, a reduction in the price of a substitute good for Q will cause:

An increase in price will lead to a lower quantity demanded because:

The position of the supply schedule for American-made cars will not be directly affected by which of the following?

The demand curve for a normal good will shift to the left if:

Market equilibrium comes at the price which quantity demanded equals quantity supplied.

A change in tastes can cause people to move down their demand curve, unlike an increase in income, which will cause the demand curve to shift.

Use the following to answer questions : Figure 3-6 -Given the supply and demand curves drawn in Figure 3-6, a technological advance that makes the production of Q more efficient can be expected to push the market clearing price down and the market clearing quantity up.

Which of the following does not explain why supply curves typically slope upward and to the right:

Use the following to answer questions : Figure 3-1 -Given the supply and demand curves drawn for a normal good in Figure 3-1, an increase in income can be expected to cause:

If the demand schedule may be written P = 100 - 4Q, and the supply schedule P = 40 + 2Q, then the market clearing price and quantity are:

The quantity of labor demanded by an employer typically depends upon the wage that labor is paid.

A fixed supply of apartments can be rationed out by letting market forces establish the market clearing competitive rent rate.

When we say that a price in a competitive market is "too low to clear the market," we usually mean that:

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

A change in which of the following will not alter the demand curve for rental housing?

Use the following to answer questions : Table 3-1 -According to Table 3-1, for every $1.00 increase in price, the quantity demanded decreases by:

If E were the old equilibrium in the wheat market depicted in the figure below and E' were the new one, which of the following might have caused the change?

An increase in demand means a movement to a higher quantity along a given demand curve.

A shift in demand to the right means that people want to buy less at each price.

Use the following to answer questions : Figure 3-5 -Point C in Figure 3-5 could represent:

A surplus in supply means that demanders are not willing to pay the current market price.

Use the following to answer questions : Figure 3-2 -Let P* and Q* in Figure 3-2 represent market clearing price and quantity, respectively, of good Q.Given the supply and demand curves drawn in Figure 3-2, a reduction in the price of a substitute good for Q will cause:

An increase in price will lead to a lower quantity demanded because:

The position of the supply schedule for American-made cars will not be directly affected by which of the following?

The demand curve for a normal good will shift to the left if:

Market equilibrium comes at the price which quantity demanded equals quantity supplied.

A change in tastes can cause people to move down their demand curve, unlike an increase in income, which will cause the demand curve to shift.

Use the following to answer questions : Figure 3-6 -Given the supply and demand curves drawn in Figure 3-6, a technological advance that makes the production of Q more efficient can be expected to push the market clearing price down and the market clearing quantity up.

Which of the following does not explain why supply curves typically slope upward and to the right:

Use the following to answer questions : Figure 3-1 -Given the supply and demand curves drawn for a normal good in Figure 3-1, an increase in income can be expected to cause:

If the demand schedule may be written P = 100 - 4Q, and the supply schedule P = 40 + 2Q, then the market clearing price and quantity are:

The quantity of labor demanded by an employer typically depends upon the wage that labor is paid.

A fixed supply of apartments can be rationed out by letting market forces establish the market clearing competitive rent rate.

When we say that a price in a competitive market is "too low to clear the market," we usually mean that:

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