Question 1

What is the effect of a decrease in business taxes?

Accepted Answer

A) It will cause an increase in the quantity supplied. 
B) It will cause an increase in demand. 
C) It will cause a decrease in demand. 
D) It will cause an increase in supply. 
E) It will cause a decrease in supply. 
A) It will cause an increase in the quantity supplied. 
B) It will cause an increase in demand. 
C) It will cause a decrease in demand. 
D) It will cause an increase in supply. 
E) It will cause a decrease in supply. D

Question 2

What effects will the following changes have on the price and quantity traded of computers?
a)General population increases
b)New and better technology for producing computers is introduced
c)Income of the population increases
d)Wage for computer workers increase

Accepted Answer

a)Price and quantity traded increase
b)Price decreases and quantity traded increases
c)Price and quantity traded increase
d)Price increases and quantity traded decreases

Question 3

What is the term for a change in the amounts that a producer is willing and able to make available as a result of a price change?

Accepted Answer

A) Change in the quantity supplied. 
B) Change in the individual supply. 
C) Change in the market supply. 
D) Change in the market demand. 
A) Change in the quantity supplied. 
B) Change in the individual supply. 
C) Change in the market supply. 
D) Change in the market demand. A

Question 4

All else held constant,an increase in supply will lead to a

Accepted Answer

A) decrease in price and increase in quantity demanded. 
B) increase in price and increase in quantity demanded. 
C) increase in price and decrease in quantity demanded. 
D) decrease in price and decrease in quantity demanded. 
A) decrease in price and increase in quantity demanded. 
B) increase in price and increase in quantity demanded. 
C) increase in price and decrease in quantity demanded. 
D) decrease in price and decrease in quantity demanded.

Question 5

-What is the effect on income if there is a decrease in the price of a product?

Accepted Answer

A) It will increase consumers' real income while leaving their actual income unchanged. 
B) It will increase consumers' actual income while leaving their real income unchanged. 
C) It will decrease demand. 
D) It will have no effect on income. 
A) It will increase consumers' real income while leaving their actual income unchanged. 
B) It will increase consumers' actual income while leaving their real income unchanged. 
C) It will decrease demand. 
D) It will have no effect on income.

Question 6

The following table shows the quantity demanded and quantity supplied of grapefruits (in millions of kilos):
  
-Refer to the table above to answer this question.If factor prices were to rise,causing the supply to change by 12 million kilos,what will be the new equilibrium price and quantity?

Accepted Answer

A) $2.25 and 36 million kilos 
B) $2.75 and 20 million kilos 
C) $2.75 and 44 million kilos 
D) $3.25 and 28 million kilos 
A) $2.25 and 36 million kilos 
B) $2.75 and 20 million kilos 
C) $2.75 and 44 million kilos 
D) $3.25 and 28 million kilos

Question 7

-Refer to the graph above to answer this question.What is the effect if the price is $1,200.

Accepted Answer

A) The quantity demanded is 120. 
B) Price will rise. 
C) The quantity supplied is 160. 
D) The quantity traded is 120. 
A) The quantity demanded is 120. 
B) Price will rise. 
C) The quantity supplied is 160. 
D) The quantity traded is 120.

Question 8

-Refer to the above information to answer this question.If supply increases by 40 units,what will be the new values of equilibrium price and quantity?

Accepted Answer

A) $40 and 140. 
B) $45 and 120. 
C) $50 and 140. 
D) $60 and 120. 
E) $60 and 140. 
A) $40 and 140. 
B) $45 and 120. 
C) $50 and 140. 
D) $60 and 120. 
E) $60 and 140.

Question 9

Assuming apple juice is a normal good,which of the following factors will increase the demand for apple juice?
a)An increase in the price of apples.
b)An increase in the price of apple juice.
c)An increase in the price of orange juice.
d)An increase in consumer income.
e)An increase in the number of apple juice suppliers.

Accepted Answer

Assuming apple juice

Question 10

-Refer to the graph above to answer this question.Which of the following statement is correct?

Accepted Answer

A) Both ab and ac represent a decrease in supply. 
B) Both ab and ac represent a decrease in the quantity supplied. 
C) While ac represents a decrease in supply,ab represents a decrease in demand. 
D) While ac represents a decrease in supply,ab represents a decrease in the quantity demanded. 
A) Both ab and ac represent a decrease in supply. 
B) Both ab and ac represent a decrease in the quantity supplied. 
C) While ac represents a decrease in supply,ab represents a decrease in demand. 
D) While ac represents a decrease in supply,ab represents a decrease in the quantity demanded.

Question 11

-Refer to the above graph to answer this question.How could you describe the movement from point A to point B?

Accepted Answer

A) An increase in demand which leads to a decrease in the equilibrium price and an increase in supply. 
B) An increase in supply which leads to an increase in the equilibrium price and an increase in demand. 
C) An increase in demand which leads to an increase in the equilibrium price and an increase in the quantity supplied. 
D) An increase in supply which leads to an increase in the equilibrium price and an increase in the quantity demanded. 
E) An increase in demand which leads to an increase in supply and an increase in the equilibrium price. 
A) An increase in demand which leads to a decrease in the equilibrium price and an increase in supply. 
B) An increase in supply which leads to an increase in the equilibrium price and an increase in demand. 
C) An increase in demand which leads to an increase in the equilibrium price and an increase in the quantity supplied. 
D) An increase in supply which leads to an increase in the equilibrium price and an increase in the quantity demanded. 
E) An increase in demand which leads to an increase in supply and an increase in the equilibrium price.

Question 12

Consider the demand and supply schedules above for a limited number of hotels in the downtown business district area of a particular city.
-Refer to the above information to answer this question.What are the equilibrium values of price and quantity?

Accepted Answer

A) $10 million and 6. 
B) $30 million and 6. 
C) $50 million and 6. 
D) $60 million and 6 
E) $80 million and 6. 
A) $10 million and 6. 
B) $30 million and 6. 
C) $50 million and 6. 
D) $60 million and 6 
E) $80 million and 6.

Question 13

In what way are Pepsi-Cola and Coca-Cola related?

Accepted Answer

A) They are substitute products. 
B) They are complementary products. 
C) They are inferior products. 
D) They are unrelated products. 
A) They are substitute products. 
B) They are complementary products. 
C) They are inferior products. 
D) They are unrelated products.

Question 14

Assume the market for apple pie is initially in equilibrium.
a)Draw a demand and supply diagram to illustrate the initial equilibrium.
b)Explain the impact on the apple pie market if there is an increase in the price of vanilla ice cream.
c)Graphically illustrate the impact on the diagram you prepared for part (a).

Accepted Answer

a) @#IMG-DLM& 
b)Assuming vanilla ice cream and ap

Question 15

What is the effect of producers' expecting that the future price of a product will decrease?

Accepted Answer

A) It will cause an increase in the quantity supplied. 
B) It will cause an increase in demand. 
C) It will cause a decrease in demand. 
D) It will cause an increase in supply. 
E) It will cause a decrease in supply. 
A) It will cause an increase in the quantity supplied. 
B) It will cause an increase in demand. 
C) It will cause a decrease in demand. 
D) It will cause an increase in supply. 
E) It will cause a decrease in supply.

Question 16

-Refer to the above graph to answer this question.What is the maximum price the quantity sold at a price of $8 could have been sold for?

Accepted Answer

A) $8. 
B) $10. 
C) $12. 
D) $14. 
E) Cannot be determined. 
A) $8. 
B) $10. 
C) $12. 
D) $14. 
E) Cannot be determined.

Question 17

An increase in the price of a product leads to an increase in the supply.

Accepted Answer

A) True 
 B)False

Question 18

Consider the demand and supply schedules above for a limited number of hotels in the downtown business district area of a particular city.
-Refer to the above information to answer this question.If two new buyers enter this market,what are the new equilibrium values of price and quantity?

Accepted Answer

A) $60 million and 6. 
B) $70 million and 6. 
C) $60 million and 8. 
D) $80 million and 8. 
E) $70 million and 7. 
A) $60 million and 6. 
B) $70 million and 6. 
C) $60 million and 8. 
D) $80 million and 8. 
E) $70 million and 7.

Question 19

-Refer to the graph above to answer this question.What would be the new equilibrium price and quantity if supply increased by 120?

Accepted Answer

A) $1,000 and 240. 
B) $600 and 240. 
C) $600 and 160. 
D) $800 and 140. 
A) $1,000 and 240. 
B) $600 and 240. 
C) $600 and 160. 
D) $800 and 140.

Question 20

-Refer to the information above to answer this question.What is the effect if price is currently $5?

Accepted Answer

A) There is a surplus of 20. 
B) There is a shortage of 20. 
C) The quantity supplied is 80 
D) The quantity traded is 80. 
A) There is a surplus of 20. 
B) There is a shortage of 20. 
C) The quantity supplied is 80 
D) The quantity traded is 80.

What is the effect of a decrease in business taxes?

What effects will the following changes have on the price and quantity traded of computers? a)General population increases b)New and better technology for producing computers is introduced c)Income of the population increases d)Wage for computer workers increase

What is the term for a change in the amounts that a producer is willing and able to make available as a result of a price change?

All else held constant,an increase in supply will lead to a

-What is the effect on income if there is a decrease in the price of a product?

The following table shows the quantity demanded and quantity supplied of grapefruits (in millions of kilos): -Refer to the table above to answer this question.If factor prices were to rise,causing the supply to change by 12 million kilos,what will be the new equilibrium price and quantity?

-Refer to the graph above to answer this question.What is the effect if the price is $1,200.

-Refer to the above information to answer this question.If supply increases by 40 units,what will be the new values of equilibrium price and quantity?

-Refer to the graph above to answer this question.Which of the following statement is correct?

-Refer to the above graph to answer this question.How could you describe the movement from point A to point B?

Consider the demand and supply schedules above for a limited number of hotels in the downtown business district area of a particular city. -Refer to the above information to answer this question.What are the equilibrium values of price and quantity?

In what way are Pepsi-Cola and Coca-Cola related?

What is the effect of producers' expecting that the future price of a product will decrease?

-Refer to the above graph to answer this question.What is the maximum price the quantity sold at a price of $8 could have been sold for?

An increase in the price of a product leads to an increase in the supply.

Consider the demand and supply schedules above for a limited number of hotels in the downtown business district area of a particular city. -Refer to the above information to answer this question.If two new buyers enter this market,what are the new equilibrium values of price and quantity?

-Refer to the graph above to answer this question.What would be the new equilibrium price and quantity if supply increased by 120?

-Refer to the information above to answer this question.What is the effect if price is currently $5?

The Economic Problem

Demand and Supply: An Elaboration

Elasticity

Consumer Choice

A Firms Production Decisions and Costs in the Short Run

Costs in the Long Run

Perfect Competition

An Evaluation of Competitive Markets

Monopoly

Imperfect Competition

The Factors of Production

International Trade

Filters

Exam 2: Demand and Supply: An Introduction

What is the effect of a decrease in business taxes?

What effects will the following changes have on the price and quantity traded of computers? a)General population increases b)New and better technology for producing computers is introduced c)Income of the population increases d)Wage for computer workers increase

What is the term for a change in the amounts that a producer is willing and able to make available as a result of a price change?

All else held constant,an increase in supply will lead to a

-What is the effect on income if there is a decrease in the price of a product?

The following table shows the quantity demanded and quantity supplied of grapefruits (in millions of kilos): -Refer to the table above to answer this question.If factor prices were to rise,causing the supply to change by 12 million kilos,what will be the new equilibrium price and quantity?

-Refer to the graph above to answer this question.What is the effect if the price is $1,200.

-Refer to the above information to answer this question.If supply increases by 40 units,what will be the new values of equilibrium price and quantity?

-Refer to the graph above to answer this question.Which of the following statement is correct?

-Refer to the above graph to answer this question.How could you describe the movement from point A to point B?

Consider the demand and supply schedules above for a limited number of hotels in the downtown business district area of a particular city. -Refer to the above information to answer this question.What are the equilibrium values of price and quantity?

In what way are Pepsi-Cola and Coca-Cola related?

What is the effect of producers' expecting that the future price of a product will decrease?

-Refer to the above graph to answer this question.What is the maximum price the quantity sold at a price of $8 could have been sold for?

An increase in the price of a product leads to an increase in the supply.

Consider the demand and supply schedules above for a limited number of hotels in the downtown business district area of a particular city. -Refer to the above information to answer this question.If two new buyers enter this market,what are the new equilibrium values of price and quantity?

-Refer to the graph above to answer this question.What would be the new equilibrium price and quantity if supply increased by 120?

-Refer to the information above to answer this question.What is the effect if price is currently $5?

The Economic Problem

Demand and Supply: An Elaboration

Elasticity

Consumer Choice

A Firms Production Decisions and Costs in the Short Run

Costs in the Long Run

Perfect Competition

An Evaluation of Competitive Markets

Monopoly

Imperfect Competition

The Factors of Production

International Trade

Filters