Question 1

If a demand curve shifts to the right,then

Accepted Answer

A) demand has increased. 
B) quantity demanded has increased. 
C) demand has decreased. 
D) quantity demanded has decreased. 
A) demand has increased. 
B) quantity demanded has increased. 
C) demand has decreased. 
D) quantity demanded has decreased.

Question 2

Technological advancements have led to lower prices and an increase in the sale of color laser printers.How does this affect the market for laser printer ink cartridges?

Accepted Answer

A) The demand curve for laser printer ink cartridges shifts to the right. 
B) The demand curve for laser printer ink cartridges shifts to the left. 
C) The quantity of laser printer ink cartridges demanded increases. 
D) The quantity of laser printer ink cartridges demanded decreases. 
A) The demand curve for laser printer ink cartridges shifts to the right. 
B) The demand curve for laser printer ink cartridges shifts to the left. 
C) The quantity of laser printer ink cartridges demanded increases. 
D) The quantity of laser printer ink cartridges demanded decreases.

Question 3

Figure 3-8  
-Refer to Figure 3-8.The graph in this figure illustrates an initial competitive equilibrium in the market for motorcycles at the intersection of D1 and S1 (point A).If the price of motorcycle engines increases,and the wages of motorcycle workers increase,how will the equilibrium point change?

Accepted Answer

A) The equilibrium point will move from A to E. 
B) The equilibrium point will move from A to B. 
C) The equilibrium point will move from A to C. 
D) The equilibrium will first move from A to B,then return to A. 
A) The equilibrium point will move from A to E. 
B) The equilibrium point will move from A to B. 
C) The equilibrium point will move from A to C. 
D) The equilibrium will first move from A to B,then return to A.

Question 4

Scarcity is defined as the situation that exists when the quantity demanded for a good is greater than the quantity supplied.

Accepted Answer

A) True 
 B)False

Question 5

Select the phrase that correctly completes the following statement."A decrease in the number of manufacturers caused a decrease in the supply of sailboats.As a result

Accepted Answer

A) the price of sailboats increased and the demand for sailboats decreased." 
B) the equilibrium quantity of sailboats increased." 
C) the price of sailboats increased and the quantity of sailboats demanded decreased." 
D) the price of sailboats increased.The higher price caused the supply of sailboats to increase." 
A) the price of sailboats increased and the demand for sailboats decreased." 
B) the equilibrium quantity of sailboats increased." 
C) the price of sailboats increased and the quantity of sailboats demanded decreased." 
D) the price of sailboats increased.The higher price caused the supply of sailboats to increase."

Question 6

If in the market for apples the supply has decreased,then

Accepted Answer

A) the supply curve for apples has shifted to the right. 
B) there has been a movement upwards along the supply curve for apples. 
C) the supply curve for apples has shifted to the left. 
D) there has been a movement downwards along the supply curve for apples. 
A) the supply curve for apples has shifted to the right. 
B) there has been a movement upwards along the supply curve for apples. 
C) the supply curve for apples has shifted to the left. 
D) there has been a movement downwards along the supply curve for apples.

Question 7

Figure 3-4  
-Refer to Figure 3-4.If the price is $10

Accepted Answer

A) there would be a surplus of 600 units. 
B) there would be a shortage of 600 units. 
C) there would be a surplus of 200 units. 
D) there would be a shortage of 200 units. 
A) there would be a surplus of 600 units. 
B) there would be a shortage of 600 units. 
C) there would be a surplus of 200 units. 
D) there would be a shortage of 200 units.

Question 8

Which of the following has occurred as the millennial generation has come of age?

Accepted Answer

A) The demand for "fast casual" food has decreased in the U.S.market. 
B) The demand for golf equipment has decreased in the U.S.market. 
C) The demand for traditional fast food has increased in the U.S.market. 
D) all of the above 
A) The demand for "fast casual" food has decreased in the U.S.market. 
B) The demand for golf equipment has decreased in the U.S.market. 
C) The demand for traditional fast food has increased in the U.S.market. 
D) all of the above

Question 9

Assume that the price for lawn care has fallen and sales of lawn care services have also fallen.One can conclude that

Accepted Answer

A) the law of supply has been violated. 
B) the number of lawn care service companies has increased. 
C) the demand for lawn care service has decreased. 
D) lawn care services are deliberately charging low prices because they want to discourage people from maintaining their own lawns. 
A) the law of supply has been violated. 
B) the number of lawn care service companies has increased. 
C) the demand for lawn care service has decreased. 
D) lawn care services are deliberately charging low prices because they want to discourage people from maintaining their own lawns.

Question 10

Because new plastic and recycled plastic are substitutes,as the price of newly produced plastic decreases

Accepted Answer

A) the demand curve for recycled plastic shifts to the left. 
B) the demand curve for recycled plastic shifts to the right. 
C) there is a movement up along the demand curve for recycled plastic. 
D) there is a movement down along the demand curve for recycled plastic. 
A) the demand curve for recycled plastic shifts to the left. 
B) the demand curve for recycled plastic shifts to the right. 
C) there is a movement up along the demand curve for recycled plastic. 
D) there is a movement down along the demand curve for recycled plastic.

Question 11

In 2004,hurricanes destroyed a large portion of Florida's orange and grapefruit crops.In the market for citrus fruit in 2004

Accepted Answer

A) the supply curve shifted to the right resulting in an increase in the equilibrium price. 
B) the supply curve shifted to the left resulting in an increase in the equilibrium price. 
C) the demand curve shifted to the right resulting in an increase in the equilibrium price. 
D) the demand curve shifted to the left resulting in a decrease in the equilibrium price. 
A) the supply curve shifted to the right resulting in an increase in the equilibrium price. 
B) the supply curve shifted to the left resulting in an increase in the equilibrium price. 
C) the demand curve shifted to the right resulting in an increase in the equilibrium price. 
D) the demand curve shifted to the left resulting in a decrease in the equilibrium price.

Question 12

Table 3-2
 $$\begin{array} { | c | c | c | c | c | } 
\hline \begin{array} { c } 
\text { Caviar } \
\text { Price per oz. } \
\text { (dollars) }
\end{array} & \begin{array} { c } 
\text { Ari's } \
\text { Quantity } \
\text { Demanded } \
\text { (oz.) }
\end{array} & \begin{array} { c } 
\text { Sonia's } \
\text { Quantity } \
\text { Demanded } \
\text { (oz.) }
\end{array} & \begin{array} { c } 
\text { Rest of } \
\text { Market } \
\text { Quantity } \
\text { Demanded } \
\text { (oz.) }
\end{array} & \begin{array} { c } 
\text { Market } \
\text { Quantity } \
\text { Demanded } \
\text { (oz.) }
\end{array} \
\hline \$ 75 & 6 & 0 & 46 & \
\hline 65 & 18 & 6 & 64 & \
\hline 55 & 28 & 14 & 136 & \
\hline 45 & 36 & 24 & 170 & \
\hline 35 & 44 & 36 & 220 & \
\hline
\end{array}$$
-Refer to Table 3-2.The table above shows the demand schedules for caviar of two individuals (Ari and Sonia)and the rest of the market.At a price of $55,the quantity demanded in the market would be

Accepted Answer

A) 42 oz. 
B) 136 oz. 
C) 178 oz. 
D) 233 oz. 
A) 42 oz. 
B) 136 oz. 
C) 178 oz. 
D) 233 oz.

Question 13

If the price of orchids falls,the substitution effect due to the price change will cause

Accepted Answer

A) an increase in the demand for orchids. 
B) an increase in the demand for roses,a substitute for orchids. 
C) an increase in the quantity of orchids demanded. 
D) an increase in the quantity of orchids supplied. 
A) an increase in the demand for orchids. 
B) an increase in the demand for roses,a substitute for orchids. 
C) an increase in the quantity of orchids demanded. 
D) an increase in the quantity of orchids supplied.

Question 14

In response to a surplus the market price of a good will fall;as the price falls,the quantity demanded will increase and quantity supplied will decrease until equilibrium is reached.

Accepted Answer

A) True 
 B)False

Question 15

Chips and salsa are complements.If the price of salsa decreases,the demand for chips will increase.

Accepted Answer

A) True 
 B)False

Question 16

An increase in the price of MP3 players will result in

Accepted Answer

A) a smaller quantity of MP3 players supplied. 
B) a larger quantity of MP3 players supplied. 
C) a decrease in the demand for MP3 players. 
D) an increase in the supply of MP3 players. 
A) a smaller quantity of MP3 players supplied. 
B) a larger quantity of MP3 players supplied. 
C) a decrease in the demand for MP3 players. 
D) an increase in the supply of MP3 players.

Question 17

Figure 3-4  
-Refer to Figure 3-4.If the current market price is $25,the market will achieve equilibrium by

Accepted Answer

A) a price increase,increasing the supply and decreasing the demand. 
B) a price decrease,decreasing the supply and increasing the demand. 
C) a price decrease,decreasing the quantity supplied and increasing the quantity demanded. 
D) a price increase,increasing the quantity supplied and decreasing the quantity demanded. 
A) a price increase,increasing the supply and decreasing the demand. 
B) a price decrease,decreasing the supply and increasing the demand. 
C) a price decrease,decreasing the quantity supplied and increasing the quantity demanded. 
D) a price increase,increasing the quantity supplied and decreasing the quantity demanded.

Question 18

Table 3-4
 $$\begin{array} { | c | c | c | c | c | } 
\hline  \begin{array} { c } 
\text { Cashews } \
\text { Priceper lb. } \
\text { (dollars) }
\end{array} & \begin{array} { c } 
\text { Jordy's } \
\text { Quantity } \
\text { Demanded } \
\text { (lbs) }
\end{array} & \begin{array} { c } 
\text { Amy's } \
\text { Quantity } \
\text { Demanded } \
\text { (lbs) }
\end{array} & \begin{array} { c } 
\text { Rest af } \
\text { Market } \
\text { Quantity } \
\text { Demanded } \
\text { (lbs) }
\end{array} & \begin{array} { c } 
\text { Market } \
\text { Quantity } \
\text { Demanded } \
\text { (lbs) }
\end{array} \
\hline \$ 10 & 1 & 1 & 50 & \
\hline 8 & 2 & 3 & 70 & \
\hline 6 & 3 & 5 & 95 & \
\hline 4 & 5 & 9 & 128 & \
\hline 2 & 8 & 14 & 156 & \
\hline
\end{array}$$
-Refer to Table 3-4.The table above shows the demand schedules for cashews of two individuals (Jordy and Amy)and the rest of the market.If the price of cashews rises from $4 to $6,the market quantity demanded would

Accepted Answer

A) decrease by 33 lbs. 
B) increase by 39 lbs. 
C) increase by 33 lbs. 
D) decrease by 39 lbs. 
A) decrease by 33 lbs. 
B) increase by 39 lbs. 
C) increase by 33 lbs. 
D) decrease by 39 lbs.

Question 19

Farmers can raise either goats or ostriches on their land.Which of the following would cause the supply of goats to decrease?

Accepted Answer

A) an increase in the price of ostriches 
B) a decrease in the price of goats 
C) an increase in the demand for goats 
D) an increase in the price of ostrich feed 
A) an increase in the price of ostriches 
B) a decrease in the price of goats 
C) an increase in the demand for goats 
D) an increase in the price of ostrich feed

Question 20

Figure 3-4  
-Refer to Figure 3-4.If the price is $25

Accepted Answer

A) there is a surplus of 300 units. 
B) there is a shortage of 300 units. 
C) there is a surplus of 200 units. 
D) there is a shortage of 200 units. 
A) there is a surplus of 300 units. 
B) there is a shortage of 300 units. 
C) there is a surplus of 200 units. 
D) there is a shortage of 200 units.

Exam 3: Where Prices Come From: the Interaction of Demand and Supply

If a demand curve shifts to the right,then

Technological advancements have led to lower prices and an increase in the sale of color laser printers.How does this affect the market for laser printer ink cartridges?

Scarcity is defined as the situation that exists when the quantity demanded for a good is greater than the quantity supplied.

Select the phrase that correctly completes the following statement."A decrease in the number of manufacturers caused a decrease in the supply of sailboats.As a result

If in the market for apples the supply has decreased,then

Figure 3-4 -Refer to Figure 3-4.If the price is $10

Which of the following has occurred as the millennial generation has come of age?

Assume that the price for lawn care has fallen and sales of lawn care services have also fallen.One can conclude that

Because new plastic and recycled plastic are substitutes,as the price of newly produced plastic decreases

In 2004,hurricanes destroyed a large portion of Florida's orange and grapefruit crops.In the market for citrus fruit in 2004

If the price of orchids falls,the substitution effect due to the price change will cause

In response to a surplus the market price of a good will fall;as the price falls,the quantity demanded will increase and quantity supplied will decrease until equilibrium is reached.

Chips and salsa are complements.If the price of salsa decreases,the demand for chips will increase.

An increase in the price of MP3 players will result in

Figure 3-4 -Refer to Figure 3-4.If the current market price is $25,the market will achieve equilibrium by

Farmers can raise either goats or ostriches on their land.Which of the following would cause the supply of goats to decrease?

Figure 3-4 -Refer to Figure 3-4.If the price is $25

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Economic Efficiency, government Price Setting, and Taxes

Externalities, environmental Policy, and Public Goods

Elasticity: the Responsiveness of Demand and Supply

The Economics of Health Care

Firms,the Stock Market,and Corporate Governance

Comparative Advantage and the Gains From International Trade

Consumer Choice and Behavioral Economics

Technology,production,and Costs

Firms in Perfectly Competitive Markets

Monopolistic Competition: the Competitive Model in a More Realistic Setting

Oligopoly: Firms in Less Competitive Markets

Monopoly and Antitrust Policy

Pricing Strategy

The Markets for Labor and Other Factors of Production

Public Choice, taxes, and the Distribution of Income

Gdp: Measuring Total Production and Income

Unemployment and Inflation

Economic Growth, the Financial System, and Business Cycles

Long-Run Economic Growth: Sources and Policies

Aggregate Expenditure and Output in the Short Run

Aggregate Demand and Aggregate Supply Analysis

Money,banks,and the Federal Reserve System

Monetary Policy

Fiscal Policy

Inflation, unemployment, and Federal Reserve Policy

Macroeconomics in an Open Economy

The International Financial System

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