Question 1

-Refer to the above graph to answer this question.What could cause the movement from point D to point A?

Accepted Answer

A) A decrease in the demand. 
B) An increase in the price. 
C) An increase in prices of resources. 
D) An increase in the price of a substitute product. 
E) An increase in the price of a complementary product. 
A) A decrease in the demand. 
B) An increase in the price. 
C) An increase in prices of resources. 
D) An increase in the price of a substitute product. 
E) An increase in the price of a complementary product. C

Question 2

If the price of a product does not change immediately,which of the following will cause an initial surplus of a product?

Accepted Answer

A) An increase in the demand or an increase in the supply. 
B) A decrease in the demand or a decrease in the supply. 
C) An increase in the demand or a decrease in the supply. 
D) A decrease in the demand or an increase in the supply. 
E) A change in the quantity demanded. 
A) An increase in the demand or an increase in the supply. 
B) A decrease in the demand or a decrease in the supply. 
C) An increase in the demand or a decrease in the supply. 
D) A decrease in the demand or an increase in the supply. 
E) A change in the quantity demanded. D

Question 3

-Refer to the information above to answer this question.Assume that the market was at equilibrium and that demand increases by 20 units.What will be the new equilibrium price and quantity?

Accepted Answer

A) Price will rise by $2 and quantity traded will rise by 20 units. 
B) Price will fall by $2 and quantity traded will fall by 20 units. 
C) Price will rise by $1 and quantity traded will rise by 10 units. 
D) Price will fall by $1 and quantity traded will fall by 10 units. 
A) Price will rise by $2 and quantity traded will rise by 20 units. 
B) Price will fall by $2 and quantity traded will fall by 20 units. 
C) Price will rise by $1 and quantity traded will rise by 10 units. 
D) Price will fall by $1 and quantity traded will fall by 10 units. C

Question 4

-Refer to the graph above to answer this question.What is the effect if the price is $1,000.

Accepted Answer

A) There is neither a shortage nor a surplus. 
B) Price will rise. 
C) Price will fall. 
D) The quantity traded is 100. 
A) There is neither a shortage nor a surplus. 
B) Price will rise. 
C) Price will fall. 
D) The quantity traded is 100.

Question 5

-Refer to the above information to answer this question.What are the equilibrium values of price and quantity?

Accepted Answer

A) $40 and 60. 
B) $40 and 140. 
C) $50 and 100. 
D) $52.50 and 100. 
E) $55 and 120. 
A) $40 and 60. 
B) $40 and 140. 
C) $50 and 100. 
D) $52.50 and 100. 
E) $55 and 120.

Question 6

What is the effect of an increase in the price of coffee?

Accepted Answer

A) It will lead to an increase in the demand for tea. 
B) It will lead to a decrease in the demand for tea. 
C) It will have no effect on the tea market. 
D) It will increase the demand for coffee. 
A) It will lead to an increase in the demand for tea. 
B) It will lead to a decrease in the demand for tea. 
C) It will have no effect on the tea market. 
D) It will increase the demand for coffee.

Question 7

What is the relationship between pizzas and hamburgers?

Accepted Answer

A) They are complementary products. 
B) They are substitute products. 
C) They are customary products. 
D) They are cooperative products. 
E) They are unrelated products. 
A) They are complementary products. 
B) They are substitute products. 
C) They are customary products. 
D) They are cooperative products. 
E) They are unrelated products.

Question 8

Assume the market for coffee is initially in equilibrium.
a)Draw a demand and supply diagram to illustrate the initial equilibrium.
b)Explain the impact on the coffee market if there is a decrease in business taxes.
c)Graphically illustrate the impact on the diagram you prepared for part (a).

Accepted Answer

a)
b)A decrease in business ta

Question 9

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 10

A decrease in the demand for a product will lead to a decrease in both the price and the quantity traded.

Accepted Answer

A) True 
 B)False

Question 11

-Refer to the information above to answer this question.Assume that there is a shortage of 40 units.What does this mean?

Accepted Answer

A) Price will fall. 
B) Price must be $8. 
C) The quantity traded is 40. 
D) Buyers would be willing to pay an additional $4 per unit for the quantity being traded. 
A) Price will fall. 
B) Price must be $8. 
C) The quantity traded is 40. 
D) Buyers would be willing to pay an additional $4 per unit for the quantity being traded.

Question 12

What is the term for the mechanism which brings buyers and sellers together to assist them in negotiation the exchange of products?

Accepted Answer

A) Production possibilities. 
B) Laissez-faire. 
C) Opportunity cost. 
D) The market. 
E) Supply and demand. 
A) Production possibilities. 
B) Laissez-faire. 
C) Opportunity cost. 
D) The market. 
E) Supply and demand.

Question 13

The above information contains supply and demand data for luxurious apartments in a downtown waterfront area.
-Refer to the above information to answer this question.What are the equilibrium values of price and quantity?

Accepted Answer

A) $1.2 million and 18. 
B) $1.4 million and 18. 
C) $1.6 million and 18. 
D) $1.8 million and 18. 
E) $2.0 million and 18. 
A) $1.2 million and 18. 
B) $1.4 million and 18. 
C) $1.6 million and 18. 
D) $1.8 million and 18. 
E) $2.0 million and 18.

Question 14

Distinguish between a demand curve and demand schedule.

Accepted Answer

Demand curve is a graphical il

Question 15

-Refer to the graph above to answer this question.What would be the new equilibrium price and quantity if demand decreased by 60?

Accepted Answer

A) $1,000 and 80. 
B) $800 and 80. 
C) $1,400 and 80. 
D) $1,400 and 60. 
A) $1,000 and 80. 
B) $800 and 80. 
C) $1,400 and 80. 
D) $1,400 and 60.

Question 16

What is the term for those products whose demand will decrease as a result of an increase in income and will increase as a result of a decrease in income?

Accepted Answer

A) Normal products. 
B) Complementary products. 
C) Substitute products. 
D) Inferior products. 
E) Related products. 
A) Normal products. 
B) Complementary products. 
C) Substitute products. 
D) Inferior products. 
E) Related products.

Question 17

What is the effect on product A of an increase in the price of complementary product B?

Accepted Answer

A) It will cause an increase in the quantity demanded. 
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 demanded. 
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 18

-Refer to Figure 2.15 to answer this question.What will be the effect if the price is now $1,200?

Accepted Answer

A) There would be a surplus of 30. 
B) There would be a shortage of 30. 
C) 160 would be purchased. 
D) There would be a surplus of 60. 
E) The price will increase. 
A) There would be a surplus of 30. 
B) There would be a shortage of 30. 
C) 160 would be purchased. 
D) There would be a surplus of 60. 
E) The price will increase.

Question 19

In what way are products A and B related if an increase in the price of product A leads to a decrease in the demand for product B?

Accepted Answer

A) Consumer income has increased,and product A is an inferior product. 
B) Consumer income has decreased,and product A is a normal product. 
C) The two products must be complements. 
D) The two products must be substitutes. 
E) The two products must be inferior products. 
A) Consumer income has increased,and product A is an inferior product. 
B) Consumer income has decreased,and product A is a normal product. 
C) The two products must be complements. 
D) The two products must be substitutes. 
E) The two products must be inferior products.

Question 20

Equilibrium price implies that everyone who would like to purchase a product is able to.

Accepted Answer

A) True 
 B)False

-Refer to the above graph to answer this question.What could cause the movement from point D to point A?

If the price of a product does not change immediately,which of the following will cause an initial surplus of a product?

-Refer to the information above to answer this question.Assume that the market was at equilibrium and that demand increases by 20 units.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 $1,000.

-Refer to the above information to answer this question.What are the equilibrium values of price and quantity?

What is the effect of an increase in the price of coffee?

What is the relationship between pizzas and hamburgers?

Assume the market for coffee is initially in equilibrium. a)Draw a demand and supply diagram to illustrate the initial equilibrium. b)Explain the impact on the coffee market if there is a decrease in business taxes. c)Graphically illustrate the impact on the diagram you prepared for part (a).

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

A decrease in the demand for a product will lead to a decrease in both the price and the quantity traded.

-Refer to the information above to answer this question.Assume that there is a shortage of 40 units.What does this mean?

What is the term for the mechanism which brings buyers and sellers together to assist them in negotiation the exchange of products?

The above information contains supply and demand data for luxurious apartments in a downtown waterfront area. -Refer to the above information to answer this question.What are the equilibrium values of price and quantity?

Distinguish between a demand curve and demand schedule.

-Refer to the graph above to answer this question.What would be the new equilibrium price and quantity if demand decreased by 60?

What is the term for those products whose demand will decrease as a result of an increase in income and will increase as a result of a decrease in income?

What is the effect on product A of an increase in the price of complementary product B?

-Refer to Figure 2.15 to answer this question.What will be the effect if the price is now $1,200?

In what way are products A and B related if an increase in the price of product A leads to a decrease in the demand for product B?

Equilibrium price implies that everyone who would like to purchase a product is able to.

The Economic Problem

Measuring the Economy 1: GDP and Economic Growth

Measuring the Economy 2: Unemployment and Inflation

Aggregate Demand and Supply

Aggregate Expenditures

Fiscal Policy

Money and Banking

The Money Market and Monetary Policy

International Trade

Exchange Rates and the Balance of Payments

Macroeconomic Policy Revisited

A Walk Through the Twentieth Century and Beyond

Filters

Exam 2: Demand and Supply: an Introduction

-Refer to the above graph to answer this question.What could cause the movement from point D to point A?

If the price of a product does not change immediately,which of the following will cause an initial surplus of a product?

-Refer to the information above to answer this question.Assume that the market was at equilibrium and that demand increases by 20 units.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 $1,000.

-Refer to the above information to answer this question.What are the equilibrium values of price and quantity?

What is the effect of an increase in the price of coffee?

What is the relationship between pizzas and hamburgers?

Assume the market for coffee is initially in equilibrium. a)Draw a demand and supply diagram to illustrate the initial equilibrium. b)Explain the impact on the coffee market if there is a decrease in business taxes. c)Graphically illustrate the impact on the diagram you prepared for part (a).

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

A decrease in the demand for a product will lead to a decrease in both the price and the quantity traded.

-Refer to the information above to answer this question.Assume that there is a shortage of 40 units.What does this mean?

What is the term for the mechanism which brings buyers and sellers together to assist them in negotiation the exchange of products?

The above information contains supply and demand data for luxurious apartments in a downtown waterfront area. -Refer to the above information to answer this question.What are the equilibrium values of price and quantity?

Distinguish between a demand curve and demand schedule.

-Refer to the graph above to answer this question.What would be the new equilibrium price and quantity if demand decreased by 60?

What is the term for those products whose demand will decrease as a result of an increase in income and will increase as a result of a decrease in income?

What is the effect on product A of an increase in the price of complementary product B?

-Refer to Figure 2.15 to answer this question.What will be the effect if the price is now $1,200?

In what way are products A and B related if an increase in the price of product A leads to a decrease in the demand for product B?

Equilibrium price implies that everyone who would like to purchase a product is able to.

The Economic Problem

Measuring the Economy 1: GDP and Economic Growth

Measuring the Economy 2: Unemployment and Inflation

Aggregate Demand and Supply

Aggregate Expenditures

Fiscal Policy

Money and Banking

The Money Market and Monetary Policy

International Trade

Exchange Rates and the Balance of Payments

Macroeconomic Policy Revisited

A Walk Through the Twentieth Century and Beyond

Filters