Question 1

In a recession,consumers have less income to spend.As a result,if dining out is a normal good,then which of the following would happen to the demand curve for dining out?

Accepted Answer

A)  The demand curve would shift leftward. 
B)  The demand curve would not shift but the price of dining out would rise. 
C)  The effect on the demand curve is unknown. 
D)  The demand curve would shift rightward. 
E)  The demand curve would not shift but the price of dining out would fall. 
A)  The demand curve would shift leftward. 
B)  The demand curve would not shift but the price of dining out would rise. 
C)  The effect on the demand curve is unknown. 
D)  The demand curve would shift rightward. 
E)  The demand curve would not shift but the price of dining out would fall.

Question 2

-The above figures show the market for HD televisions.Blu-ray players can be used to play HD movies.If the price of blu-ray players falls,then which figure shows the effect of this change in the market for HD televisions?

Accepted Answer

A)  Figure A 
B)  Figure B 
C)  Figure C 
D)  Figure D 
E)  None of the figures represent this change. 
A)  Figure A 
B)  Figure B 
C)  Figure C 
D)  Figure D 
E)  None of the figures represent this change.

Question 3

An increase in the number of fast-food restaurants

Accepted Answer

A)  raises the price of fast-food meals. 
B)  increases the demand for fast-food meals. 
C)  increases the supply of fast-food meals. 
D)  increases the demand for substitutes for fast-food meals. 
E)  increases both the demand and supply of fast-food meals. 
A)  raises the price of fast-food meals. 
B)  increases the demand for fast-food meals. 
C)  increases the supply of fast-food meals. 
D)  increases the demand for substitutes for fast-food meals. 
E)  increases both the demand and supply of fast-food meals.

Question 4

Wheat is used to produce cereal.When the price of wheat falls,the

Accepted Answer

A)  demand for wheat increases. 
B)  supply of wheat decreases. 
C)  supply of cereal increases. 
D)  demand for cereal increases. 
E)  demand for cereal decreases. 
A)  demand for wheat increases. 
B)  supply of wheat decreases. 
C)  supply of cereal increases. 
D)  demand for cereal increases. 
E)  demand for cereal decreases.

Question 5

-Pizza is a normal good.Which figure above shows the effect of a decrease in consumers' incomes?

Accepted Answer

A)  Figure A 
B)  Figure B 
C)  Figure C 
D)  Figure D 
E)  Both Figure B and Figure C 
A)  Figure A 
B)  Figure B 
C)  Figure C 
D)  Figure D 
E)  Both Figure B and Figure C

Question 6

Gasoline prices increase by 50 percent and other things remain the same.As a result,there is

Accepted Answer

A)  an increase in the demand for gasoline. 
B)  a decrease in the demand for gasoline. 
C)  no change in the quantity of gasoline demanded. 
D)  a decrease in the quantity of gasoline demanded. 
E)  More information is needed to determine if the demand for gasoline increases or decreases. 
A)  an increase in the demand for gasoline. 
B)  a decrease in the demand for gasoline. 
C)  no change in the quantity of gasoline demanded. 
D)  a decrease in the quantity of gasoline demanded. 
E)  More information is needed to determine if the demand for gasoline increases or decreases.

Question 7

The phrase "a change in demand" most directly implies a

Accepted Answer

A)  movement along a demand curve. 
B)  movement along the price curve. 
C)  change in the quantity demanded of a good. 
D)  shift of the demand curve. 
E)  movement along the quantity curve. 
A)  movement along a demand curve. 
B)  movement along the price curve. 
C)  change in the quantity demanded of a good. 
D)  shift of the demand curve. 
E)  movement along the quantity curve.

Question 8

Water bottlers announce that next month the price of bottled water will rise by 25 percent.Which of the following occurs immediately?

Accepted Answer

A)  The quantity of bottled water demanded increases. 
B)  The quantity of bottled water demanded decreases. 
C)  The demand for bottled water decreases. 
D)  The demand for bottled water increases. 
E)  None of the above answers is correct because it is the supply that immediately changes, not the demand. 
A)  The quantity of bottled water demanded increases. 
B)  The quantity of bottled water demanded decreases. 
C)  The demand for bottled water decreases. 
D)  The demand for bottled water increases. 
E)  None of the above answers is correct because it is the supply that immediately changes, not the demand.

Question 9

Teenagers drink more soda than other age groups.If the number of teenagers increases,everything else remaining the same,

Accepted Answer

A)  market demand for soda increases. 
B)  market demand for soda decreases. 
C)  market demand for soda does not change. 
D)  there is a movement along the market demand curve for soda. 
E)  None of the above answers is correct because the effect on the demand depends whether the supply curve shifts rightward, leftward, or not at all. 
A)  market demand for soda increases. 
B)  market demand for soda decreases. 
C)  market demand for soda does not change. 
D)  there is a movement along the market demand curve for soda. 
E)  None of the above answers is correct because the effect on the demand depends whether the supply curve shifts rightward, leftward, or not at all.

Question 10

When the demand for blue jeans increases,what happens next?

Accepted Answer

If the demand for blue jeans increases,t

Question 11

-The above table gives the demand and supply schedules for cat food.If the price is $3.00 per pound of cat food,will there be a shortage,a surplus,or is this price the equilibrium price? If there is a shortage,how much is the shortage? If there is a surplus,how much is the surplus? If $3.00 is the equilibrium price,what is the equilibrium quantity?

Accepted Answer

At a price of $3.00 per pound

Question 12

Suppose over the next several years the productivity of firms producing electric cars improves dramatically.The advance in productivity leads to

Accepted Answer

A)  a decrease in the supply of electric cars so that the supply curve shifts leftward. 
B)  a decrease in the supply of electric cars so that the supply curve shifts rightward. 
C)  an increase in the supply of electric cars so that the supply curve shifts leftward. 
D)  an increase in the supply electric cars so that the supply curve shifts rightward. 
E)  no change in the supply of electric cars, only a change in the quantity supplied of electric cars. 
A)  a decrease in the supply of electric cars so that the supply curve shifts leftward. 
B)  a decrease in the supply of electric cars so that the supply curve shifts rightward. 
C)  an increase in the supply of electric cars so that the supply curve shifts leftward. 
D)  an increase in the supply electric cars so that the supply curve shifts rightward. 
E)  no change in the supply of electric cars, only a change in the quantity supplied of electric cars.

Question 13

The number of corn producers increases,so the supply of corn ________ and the supply curve of corn ________.

Accepted Answer

A)  increases; shifts rightward 
B)  increases; shifts leftward 
C)  decrease; shifts rightward 
D)  decreases; shifts leftward 
E)  increases; does not shift 
A)  increases; shifts rightward 
B)  increases; shifts leftward 
C)  decrease; shifts rightward 
D)  decreases; shifts leftward 
E)  increases; does not shift

Question 14

Autoworkers negotiate a wage increase.How does this change affect the supply curve of cars?

Accepted Answer

A)  It shifts the supply curve leftward. 
B)  It shifts the supply curve rightward. 
C)  It does not shift the supply curve or create a movement along it. 
D)  The supply curve will shift but there is not enough information to tell if the change shifts the supply curve rightward, leftward, or not at all. 
E)  It creates a movement downward along the supply curve. 
A)  It shifts the supply curve leftward. 
B)  It shifts the supply curve rightward. 
C)  It does not shift the supply curve or create a movement along it. 
D)  The supply curve will shift but there is not enough information to tell if the change shifts the supply curve rightward, leftward, or not at all. 
E)  It creates a movement downward along the supply curve.

Question 15

A technological improvement lowers the cost of producing corn.As a result,the price of a pound of corn ________ and the quantity of corn ________.

Accepted Answer

A)  rises; increases 
B)  rises; decreases 
C)  falls; increases 
D)  falls; decreases 
E)  falls; does not change 
A)  rises; increases 
B)  rises; decreases 
C)  falls; increases 
D)  falls; decreases 
E)  falls; does not change

Question 16

Hot dogs and hot dog buns are complements.If the price of a hot dog falls,then

Accepted Answer

A)  the demand for hot dogs will increase. 
B)  the demand for hot dog buns will decrease. 
C)  the quantity demanded of hotdogs will decrease. 
D)  the demand for hot dog buns will increase. 
E)  the quantity demanded of hot dog buns will increase. 
A)  the demand for hot dogs will increase. 
B)  the demand for hot dog buns will decrease. 
C)  the quantity demanded of hotdogs will decrease. 
D)  the demand for hot dog buns will increase. 
E)  the quantity demanded of hot dog buns will increase.

Question 17

Computer chips are a normal good.Suppose the economy slips into a recession so that income falls.As a result,the demand for computer chips ________ so that the price of a computer chip ________.

Accepted Answer

A)  increases; rises 
B)  increases; falls 
C)  decreases; rises 
D)  decreases; falls 
E)  decreases; does not change 
A)  increases; rises 
B)  increases; falls 
C)  decreases; rises 
D)  decreases; falls 
E)  decreases; does not change

Question 18

-The above figure shows the market for laptops.Which of the following shifts the supply curve from S? to S??

Accepted Answer

A)  an increase in the cost of hard drives 
B)  a decrease in the price of laptops 
C)  an increase in the number of laptop manufactures and sellers 
D)  an increase in the price of laptops 
E)  an increase in the productivity of the workers manufacturing laptops 
A)  an increase in the cost of hard drives 
B)  a decrease in the price of laptops 
C)  an increase in the number of laptop manufactures and sellers 
D)  an increase in the price of laptops 
E)  an increase in the productivity of the workers manufacturing laptops

Question 19

Suppose the government imposes a small carbon tax on automakers.But the price of gasoline has doubled due to a Middle East crisis which has reduced oil production.In the market for autos,these changes mean that supply and demand have both changed with the effect on the demand larger than the effect on the supply.The result is that the price of autos will ________ and the number of autos sold will ________.

Accepted Answer

A)  rise; perhaps change but we can't say if it increases, decreases, or stays the same 
B)  rise; increase 
C)  rise; decrease 
D)  fall; perhaps change but we can't say if it increases, decreases, or stays the same 
E)  fall; decrease 
A)  rise; perhaps change but we can't say if it increases, decreases, or stays the same 
B)  rise; increase 
C)  rise; decrease 
D)  fall; perhaps change but we can't say if it increases, decreases, or stays the same 
E)  fall; decrease

Question 20

Consider the market for wheat.If there is an improvement in harvesting technology,

Accepted Answer

A)  the supply curve for wheat shifts rightward. 
B)  the demand curve for wheat shifts rightward. 
C)  there is a movement up along the demand curve. 
D)  the equilibrium price rises. 
E)  the demand curve for wheat shifts leftward. 
A)  the supply curve for wheat shifts rightward. 
B)  the demand curve for wheat shifts rightward. 
C)  there is a movement up along the demand curve. 
D)  the equilibrium price rises. 
E)  the demand curve for wheat shifts leftward.

In a recession,consumers have less income to spend.As a result,if dining out is a normal good,then which of the following would happen to the demand curve for dining out?

-The above figures show the market for HD televisions.Blu-ray players can be used to play HD movies.If the price of blu-ray players falls,then which figure shows the effect of this change in the market for HD televisions?

An increase in the number of fast-food restaurants

Wheat is used to produce cereal.When the price of wheat falls,the

-Pizza is a normal good.Which figure above shows the effect of a decrease in consumers' incomes?

Gasoline prices increase by 50 percent and other things remain the same.As a result,there is

The phrase "a change in demand" most directly implies a

Water bottlers announce that next month the price of bottled water will rise by 25 percent.Which of the following occurs immediately?

Teenagers drink more soda than other age groups.If the number of teenagers increases,everything else remaining the same,

When the demand for blue jeans increases,what happens next?

Suppose over the next several years the productivity of firms producing electric cars improves dramatically.The advance in productivity leads to

The number of corn producers increases,so the supply of corn and the supply curve of corn .

Autoworkers negotiate a wage increase.How does this change affect the supply curve of cars?

A technological improvement lowers the cost of producing corn.As a result,the price of a pound of corn and the quantity of corn .

Hot dogs and hot dog buns are complements.If the price of a hot dog falls,then

Computer chips are a normal good.Suppose the economy slips into a recession so that income falls.As a result,the demand for computer chips so that the price of a computer chip .

-The above figure shows the market for laptops.Which of the following shifts the supply curve from S? to S??

Consider the market for wheat.If there is an improvement in harvesting technology,

Getting Started

The U.S.and Global Economies

The Economic Problem

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets with Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

Exam 4: Demand and Supply

In a recession,consumers have less income to spend.As a result,if dining out is a normal good,then which of the following would happen to the demand curve for dining out?

-The above figures show the market for HD televisions.Blu-ray players can be used to play HD movies.If the price of blu-ray players falls,then which figure shows the effect of this change in the market for HD televisions?

An increase in the number of fast-food restaurants

Wheat is used to produce cereal.When the price of wheat falls,the

-Pizza is a normal good.Which figure above shows the effect of a decrease in consumers' incomes?

Gasoline prices increase by 50 percent and other things remain the same.As a result,there is

The phrase "a change in demand" most directly implies a

Water bottlers announce that next month the price of bottled water will rise by 25 percent.Which of the following occurs immediately?

Teenagers drink more soda than other age groups.If the number of teenagers increases,everything else remaining the same,

When the demand for blue jeans increases,what happens next?

Suppose over the next several years the productivity of firms producing electric cars improves dramatically.The advance in productivity leads to

The number of corn producers increases,so the supply of corn ________ and the supply curve of corn ________.

Autoworkers negotiate a wage increase.How does this change affect the supply curve of cars?

A technological improvement lowers the cost of producing corn.As a result,the price of a pound of corn ________ and the quantity of corn ________.

Hot dogs and hot dog buns are complements.If the price of a hot dog falls,then

Computer chips are a normal good.Suppose the economy slips into a recession so that income falls.As a result,the demand for computer chips ________ so that the price of a computer chip ________.

-The above figure shows the market for laptops.Which of the following shifts the supply curve from S? to S??

Consider the market for wheat.If there is an improvement in harvesting technology,

Getting Started

The U.S.and Global Economies

The Economic Problem

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets with Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

The number of corn producers increases,so the supply of corn and the supply curve of corn .

A technological improvement lowers the cost of producing corn.As a result,the price of a pound of corn and the quantity of corn .

Computer chips are a normal good.Suppose the economy slips into a recession so that income falls.As a result,the demand for computer chips so that the price of a computer chip .