Question 1

More television sets are being sold today than one year ago,and the selling price has increased.This could have been caused by a(n)

Accepted Answer

A) increase in demand. 
B) decrease in supply. 
C) decrease in demand. 
D) increase in supply. 
E) exception to the law of demand. 
A) increase in demand. 
B) decrease in supply. 
C) decrease in demand. 
D) increase in supply. 
E) exception to the law of demand.

Question 2

When a surplus exists in a market,the actual price will begin to decrease.

Accepted Answer

A) True 
 B)False

Question 3

An increase in the minimum wage will not affect the supply of goods such as McDonald's hamburgers.

Accepted Answer

A) True 
 B)False

Question 4

Draw a supply and demand diagram with supply and demand both increasing and market equilibrium price increasing as well.

Accepted Answer

The answer of Draw a supply and demand diagram with...

Question 5

Which of the following will not cause the supply of long-distance telephone service to increase?

Accepted Answer

A) A reduction in the number of long-distance companies 
B) A reduction in space shuttle fees to launch telecommunications satellites 
C) A decrease in the price of computer electronics used to route long-distance calls 
D) A decrease in the number of government regulations on long-distance telephoning services 
E) A reduction in the price of fiber-optic cables over which phone messages are sent 
A) A reduction in the number of long-distance companies 
B) A reduction in space shuttle fees to launch telecommunications satellites 
C) A decrease in the price of computer electronics used to route long-distance calls 
D) A decrease in the number of government regulations on long-distance telephoning services 
E) A reduction in the price of fiber-optic cables over which phone messages are sent

Question 6

All else held equal,if the price of sirloin steak increases from $4.25 to $8.60 per pound,a greater quantity of sirloin steak will be supplied.

Accepted Answer

A) True 
 B)False

Question 7

The law of demand states that

Accepted Answer

A) as price decreases,demand increases. 
B) as price increases,quantity demanded increases. 
C) there is a direct relationship between price and quantity supplied. 
D) there is an inverse relationship between price and quantity demanded. 
E) there is an inverse relationship between price and quantity supplied. 
A) as price decreases,demand increases. 
B) as price increases,quantity demanded increases. 
C) there is a direct relationship between price and quantity supplied. 
D) there is an inverse relationship between price and quantity demanded. 
E) there is an inverse relationship between price and quantity supplied.

Question 8

Coffee and tea are substitutes so that if the price of tea increases,the

Accepted Answer

A) quantity demanded for coffee increases. 
B) quantity demanded for coffee decreases. 
C) demand for coffee increases. 
D) demand for coffee decreases. 
E) demand for coffee remains the same. 
A) quantity demanded for coffee increases. 
B) quantity demanded for coffee decreases. 
C) demand for coffee increases. 
D) demand for coffee decreases. 
E) demand for coffee remains the same.

Question 9

The demand curve of good X is drawn by assuming that all of the following are equal except

Accepted Answer

A) the price of good X. 
B) consumer income. 
C) consumer preferences. 
D) the price of good Y. 
E) the number of consumers. 
A) the price of good X. 
B) consumer income. 
C) consumer preferences. 
D) the price of good Y. 
E) the number of consumers.

Question 10

The demand curve for a particular good shifts when any factor other than the price of that good changes.

Accepted Answer

A) True 
 B)False

Question 11

Exhibit 3-2  
-In the market represented in Exhibit 3-2,if price is $.50,

Accepted Answer

A) producers are not able to sell all they are willing to sell. 
B) a surplus of 30 units results. 
C) producers are willing to produce more than is being purchased. 
D) consumers are willing to buy more than is being produced. 
E) consumers are willing to buy the same amount as that being produced. 
A) producers are not able to sell all they are willing to sell. 
B) a surplus of 30 units results. 
C) producers are willing to produce more than is being purchased. 
D) consumers are willing to buy more than is being produced. 
E) consumers are willing to buy the same amount as that being produced.

Question 12

When there is a decrease in supply,all else held equal,

Accepted Answer

A) equilibrium price falls,demand increases,and equilibrium quantity increases. 
B) equilibrium price falls,demand does not change,and equilibrium quantity increases. 
C) equilibrium price rises,quantity demanded decreases,and equilibrium quantity decreases. 
D) equilibrium price falls,quantity demanded decreases,and equilibrium quantity decreases. 
E) equilibrium price rises,demand does not change,and equilibrium quantity increases. 
A) equilibrium price falls,demand increases,and equilibrium quantity increases. 
B) equilibrium price falls,demand does not change,and equilibrium quantity increases. 
C) equilibrium price rises,quantity demanded decreases,and equilibrium quantity decreases. 
D) equilibrium price falls,quantity demanded decreases,and equilibrium quantity decreases. 
E) equilibrium price rises,demand does not change,and equilibrium quantity increases.

Question 13

If quantity supplied is less than quantity demanded,then

Accepted Answer

A) there is a shortage in the market. 
B) prices will fall. 
C) equilibrium has been achieved. 
D) consumer incomes will increase. 
E) there is a surplus in the market. 
A) there is a shortage in the market. 
B) prices will fall. 
C) equilibrium has been achieved. 
D) consumer incomes will increase. 
E) there is a surplus in the market.

Question 14

The high price of gasoline in the late-2000s was likely the result of

Accepted Answer

A) an increase in both the supply of and the demand for gasoline. 
B) a decrease in both the supply of and the demand for gasoline. 
C) an increase in the supply of gasoline along with a decrease in the demand for gasoline. 
D) a decrease in the supply of gasoline along with an increase in the demand for gasoline. 
E) no change in either the supply of or the demand for gasoline. 
A) an increase in both the supply of and the demand for gasoline. 
B) a decrease in both the supply of and the demand for gasoline. 
C) an increase in the supply of gasoline along with a decrease in the demand for gasoline. 
D) a decrease in the supply of gasoline along with an increase in the demand for gasoline. 
E) no change in either the supply of or the demand for gasoline.

Question 15

Which of the following will not increase the demand for a good?

Accepted Answer

A) An expectation of a decline in the product price in the future 
B) The product price falls,ceteris paribus. 
C) An increase in the price of a substitute 
D) A decrease in the price of a complement 
E) A foreign country opens its markets to imports from others. 
A) An expectation of a decline in the product price in the future 
B) The product price falls,ceteris paribus. 
C) An increase in the price of a substitute 
D) A decrease in the price of a complement 
E) A foreign country opens its markets to imports from others.

Question 16

The law of demand is violated when the demand for a product is high at a high price.

Accepted Answer

A) True 
 B)False

Question 17

The law of supply states that the quantity supplied of a good is positively related to the price of that good.

Accepted Answer

A) True 
 B)False

Question 18

Suppose demand and supply in a market can be expressed by these equations:
QD = 40 - 0.5P
QS = 15 + 2P
If the prevailing market price is $30,what are the quantity demanded and the quantity supplied?

Accepted Answer

Substitute 30 for P in each eq

Question 19

A shortage occurs when quantity demanded exceeds quantity supplied.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following causes a movement along the supply curve for a product?

Accepted Answer

A) An increase in the production cost 
B) An increase in the number of sellers 
C) An expectation of a higher future price 
D) An increase in the tax on production 
E) An increase in the price of that product 
A) An increase in the production cost 
B) An increase in the number of sellers 
C) An expectation of a higher future price 
D) An increase in the tax on production 
E) An increase in the price of that product

Exam 3: The Supply and Demand Model

More television sets are being sold today than one year ago,and the selling price has increased.This could have been caused by a(n)

When a surplus exists in a market,the actual price will begin to decrease.

An increase in the minimum wage will not affect the supply of goods such as McDonald's hamburgers.

Draw a supply and demand diagram with supply and demand both increasing and market equilibrium price increasing as well.

Which of the following will not cause the supply of long-distance telephone service to increase?

All else held equal,if the price of sirloin steak increases from $4.25 to $8.60 per pound,a greater quantity of sirloin steak will be supplied.

The law of demand states that

Coffee and tea are substitutes so that if the price of tea increases,the

The demand curve of good X is drawn by assuming that all of the following are equal except

The demand curve for a particular good shifts when any factor other than the price of that good changes.

Exhibit 3-2 -In the market represented in Exhibit 3-2,if price is $.50,

When there is a decrease in supply,all else held equal,

If quantity supplied is less than quantity demanded,then

The high price of gasoline in the late-2000s was likely the result of

Which of the following will not increase the demand for a good?

The law of demand is violated when the demand for a product is high at a high price.

The law of supply states that the quantity supplied of a good is positively related to the price of that good.

Suppose demand and supply in a market can be expressed by these equations: QD = 40 - 0.5P QS = 15 + 2P If the prevailing market price is $30,what are the quantity demanded and the quantity supplied?

A shortage occurs when quantity demanded exceeds quantity supplied.

Which of the following causes a movement along the supply curve for a product?

The Central Idea

Observing and Explaining the Economy

Subtleties of the Supply and Demand Model: Price Floors,price Ceilings,and Elasticity

The Demand Curve and the Behavior of Consumers

The Supply Curve and the Behavior of Firms

The Interaction of People in Markets

Costs and the Changes at Firms Over Time

The Rise and Fall of Industries

Monopoly

Product Differentiation, monopolistic Competition, and Oligopoly

Antitrust Policy and Regulation

Labor Markets

Taxes, transfers, and Income Distribution

Public Goods, externalities, and Government Behavior

Capital and Financial Markets

Macroeconomics: the Big Picture

Measuring the Production, income, and Spending of Nations

The Spending Allocation Model

Unemployment and Employment

Productivity and Economic Growth

Money and Inflation

The Nature and Causes of Economic Fluctuations

The Economic Fluctuations Model

Using the Economic Fluctuations Model

Fiscal Policy

Monetary Policy

Economic Growth and Globalization

International Trade

International Finance

Reading,understanding,and Creating Graphs

Consumer Theory With Indifference Curves

Producer Theory With Isoquants

Present Discounted Value

The Miracle of Compound Growth

Deriving the Growth Accounting Formula

Deriving the Formula for the Keynesian Multiplier and the Forward-Looking Consumption Model

Filters

Suppose demand and supply in a market can be expressed by these equations: Q_D = 40 - 0.5P Q_S = 15 + 2P If the prevailing market price is $30,what are the quantity demanded and the quantity supplied?