Question 1

A schedule of amounts of a good that people will purchase at various prices during a specific time period holding other factors constant is

Accepted Answer

A) a market. 
B) supply. 
C) demand. 
D) the market clearing price. 
A) a market. 
B) supply. 
C) demand. 
D) the market clearing price.

Question 2

The market supply curve is found by

Accepted Answer

A) surveys of consumer groups. 
B) vertically summing up the equilibrium prices of individual firms. 
C) horizontally summing up the supply curves of individual firms. 
D) estimating what the supply curve would be of one huge firm large enough to serve the entire market. 
A) surveys of consumer groups. 
B) vertically summing up the equilibrium prices of individual firms. 
C) horizontally summing up the supply curves of individual firms. 
D) estimating what the supply curve would be of one huge firm large enough to serve the entire market.

Question 3

If the price of a product increases,

Accepted Answer

A) there is an increase in quantity supplied and a decrease in demand. 
B) there is an increase in supply and a decrease in quantity demanded. 
C) there is an increase in supply and a decrease in demand. 
D) there is an increase in quantity supplied and a decrease in quantity demanded. 
A) there is an increase in quantity supplied and a decrease in demand. 
B) there is an increase in supply and a decrease in quantity demanded. 
C) there is an increase in supply and a decrease in demand. 
D) there is an increase in quantity supplied and a decrease in quantity demanded.

Question 4

Which of the following is a non-price determinant of demand?

Accepted Answer

A) income 
B) tastes and preferences 
C) prices of related goods and services 
D) All of the above are correct. 
A) income 
B) tastes and preferences 
C) prices of related goods and services 
D) All of the above are correct.

Question 5

-Refer to the above figure.At a price of four cents,the quantity of bubble gum supplied will be

Accepted Answer

A) 3. 
B) 2. 
C) 4. 
D) 5. 
A) 3. 
B) 2. 
C) 4. 
D) 5.

Question 6

-In the above figure,when the price of Good B increases,the result can be shown by

Accepted Answer

A) the movement from D1 to D2 in Graph A. 
B) the movement from D2 to D1 in Graph A. 
C) the movement along D0 from P1 to P2. 
D) the movement along D0 from P2 to P1. 
A) the movement from D1 to D2 in Graph A. 
B) the movement from D2 to D1 in Graph A. 
C) the movement along D0 from P1 to P2. 
D) the movement along D0 from P2 to P1.

Question 7

If more foreign auto plants relocate to the United States,we would expect

Accepted Answer

A) the U.S.supply curve for automobiles to shift to the right. 
B) the U.S.supply curve for automobiles would shift to the left. 
C) that the U.S.auto market would not respond. 
D) that U.S.auto demand might change,but U.S.auto supply would remain static. 
A) the U.S.supply curve for automobiles to shift to the right. 
B) the U.S.supply curve for automobiles would shift to the left. 
C) that the U.S.auto market would not respond. 
D) that U.S.auto demand might change,but U.S.auto supply would remain static.

Question 8

Which one of the following would cause a rightward shift in the demand curve of digital cameras?

Accepted Answer

A) Digital cameras become easier to use. 
B) The price of digital cameras decreases. 
C) Production methods are modified to make production of digital cameras more efficient. 
D) Government regulations are imposed to limit the number of digital cameras imported. 
A) Digital cameras become easier to use. 
B) The price of digital cameras decreases. 
C) Production methods are modified to make production of digital cameras more efficient. 
D) Government regulations are imposed to limit the number of digital cameras imported.

Question 9

The direct relationship between changes in price and changes in quantity supplied is

Accepted Answer

A) a change in supply. 
B) shown by a shift in the supply curve. 
C) the law of supply. 
D) the law of relative production. 
A) a change in supply. 
B) shown by a shift in the supply curve. 
C) the law of supply. 
D) the law of relative production.

Question 10

Total market supply can be derived by

Accepted Answer

A) horizontally summing individual supply curves at each and every price level. 
B) vertically summing individual supply curves at the current technology level. 
C) adding up the largest quantity demanded at various prices. 
D) looking at the changes in the price of raw materials needed to produce the product. 
A) horizontally summing individual supply curves at each and every price level. 
B) vertically summing individual supply curves at the current technology level. 
C) adding up the largest quantity demanded at various prices. 
D) looking at the changes in the price of raw materials needed to produce the product.

Question 11

The market supply curve is found by

Accepted Answer

A) plotting the supply curves of individual firms. 
B) plotting and summing up the supply curves of individual firms. 
C) plotting the supply curves of individual consumers. 
D) taking the supply curve of the representative firm. 
A) plotting the supply curves of individual firms. 
B) plotting and summing up the supply curves of individual firms. 
C) plotting the supply curves of individual consumers. 
D) taking the supply curve of the representative firm.

Question 12

$$\begin{array} { c c c } 
\text { Price } & \begin{array} { c } 
\text { Quantity } \
\text { Demanded }
\end{array} & \begin{array} { c } 
\text { Quantity } \
\text { Supplied }
\end{array} \
\hline \$ 5 & 5 & 25 \
\$ 4 & 10 & 20 \
\$ 3 & 15 & 15 \
\$ 2 & 20 & 10 \
\$ 1 & 25 & 5 \
\hline
\end{array}$$
-Using the above table,at a price of $5 there will be a

Accepted Answer

A) shortage of 20 units. 
B) shortage of 10 units. 
C) surplus of 20 units. 
D) surplus of 10 units. 
A) shortage of 20 units. 
B) shortage of 10 units. 
C) surplus of 20 units. 
D) surplus of 10 units.

Question 13

Which factor would cause a movement along the demand curve for pizza?

Accepted Answer

A) an increase in the number of students in town 
B) a renewed preference for Italian food 
C) a drop in the price of pizza 
D) an increase in average income 
A) an increase in the number of students in town 
B) a renewed preference for Italian food 
C) a drop in the price of pizza 
D) an increase in average income

Question 14

The price of a new textbook increased by 25 percent and the price of a used textbook increased by 30 percent.What happened to the relative price of the new textbook?

Accepted Answer

A) It increased by 5 percent. 
B) It increased,but we can't tell by how much without more information. 
C) It decreased by 5 percent. 
D) It decreased,but we can't tell by how much without more information. 
A) It increased by 5 percent. 
B) It increased,but we can't tell by how much without more information. 
C) It decreased by 5 percent. 
D) It decreased,but we can't tell by how much without more information.

Question 15

A direct or positive relationship between price and quantity supplied is

Accepted Answer

A) the market clearing price. 
B) a change in demand. 
C) a supply curve. 
D) a demand curve. 
A) the market clearing price. 
B) a change in demand. 
C) a supply curve. 
D) a demand curve.

Question 16

When there is an excess quantity of a product supplied,there will be

Accepted Answer

A) a tendency for price of the product to increase. 
B) a tendency for price of the product to fall. 
C) incentives for consumers to leave the market. 
D) upward pressure on the price of labor. 
A) a tendency for price of the product to increase. 
B) a tendency for price of the product to fall. 
C) incentives for consumers to leave the market. 
D) upward pressure on the price of labor.

Question 17

-Refer to the above figure.Which diagram shows the effect on the market of Corn Flakes when the demand for Corn Flakes has increased?

Accepted Answer

A) graph C 
B) graph D 
C) neither graph 
D) both graphs 
A) graph C 
B) graph D 
C) neither graph 
D) both graphs

Question 18

Pam graduates from law school and gets a position in a law firm.At the same time the price of hamburger falls while other food prices have stayed the same.She notices that she buys less hamburger than she did before.Is she violating the law of demand?

Accepted Answer

A) Yes,since she is buying less hamburger at a lower price. 
B) Yes,since she is buying less hamburger in a relatively short period of time and we wouldn't expect her tastes to have changed. 
C) No,since the law of demand refers to relative price changes and the price of hamburger falling is an absolute price change. 
D) No,since other things are not held constant,such as her income. 
A) Yes,since she is buying less hamburger at a lower price. 
B) Yes,since she is buying less hamburger in a relatively short period of time and we wouldn't expect her tastes to have changed. 
C) No,since the law of demand refers to relative price changes and the price of hamburger falling is an absolute price change. 
D) No,since other things are not held constant,such as her income.

Question 19

A demand curve is a graphical representation of

Accepted Answer

A) consumer tastes. 
B) national income. 
C) the demand schedule. 
D) relative prices. 
A) consumer tastes. 
B) national income. 
C) the demand schedule. 
D) relative prices.

Question 20

John believes that when the price of a good increases people will purchase more of the good.This statement is

Accepted Answer

A) consistent with the law of demand. 
B) inconsistent with the law of demand. 
C) referring to money prices. 
D) consistent with the law of supply. 
A) consistent with the law of demand. 
B) inconsistent with the law of demand. 
C) referring to money prices. 
D) consistent with the law of supply.

Exam 3: Demand and Supply

A schedule of amounts of a good that people will purchase at various prices during a specific time period holding other factors constant is

The market supply curve is found by

If the price of a product increases,

Which of the following is a non-price determinant of demand?

-Refer to the above figure.At a price of four cents,the quantity of bubble gum supplied will be

-In the above figure,when the price of Good B increases,the result can be shown by

If more foreign auto plants relocate to the United States,we would expect

Which one of the following would cause a rightward shift in the demand curve of digital cameras?

The direct relationship between changes in price and changes in quantity supplied is

Total market supply can be derived by

The market supply curve is found by

Price Quantity Demanded Quantity Supplied \ 5 5 25 \ 4 10 20 \ 3 15 15 \ 2 20 10 \ 1 25 5 -Using the above table,at a price of $5 there will be a

Which factor would cause a movement along the demand curve for pizza?

The price of a new textbook increased by 25 percent and the price of a used textbook increased by 30 percent.What happened to the relative price of the new textbook?

A direct or positive relationship between price and quantity supplied is

When there is an excess quantity of a product supplied,there will be

-Refer to the above figure.Which diagram shows the effect on the market of Corn Flakes when the demand for Corn Flakes has increased?

Pam graduates from law school and gets a position in a law firm.At the same time the price of hamburger falls while other food prices have stayed the same.She notices that she buys less hamburger than she did before.Is she violating the law of demand?

A demand curve is a graphical representation of

John believes that when the price of a good increases people will purchase more of the good.This statement is

The Nature of Economics

Scarcity and the World of Trade-Offs

Extensions of Demand and Supply Analysis

Public Spending and Public Choice

Funding the Public Sector

Demand and Supply Elasticity

Consumer Choice

Rents, profits, and the Financial Environment of Business

The Firm: Cost and Output Determination

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly and Strategic Behavior

Regulation and Antitrust Policy in a Globalized Economy

The Labor Market: Demand, supply and Outsourcing

Unions and Labor Market Monopoly Power

Income, poverty, and Health Care

Environmental Economics

Comparative Advantage and the Open Economy

Exchange Rates and the Balance of Payments

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