Question 1

Figure 3-4  
-Refer to Figure 3-4.At a price of $25,how many units will be sold?

Accepted Answer

A) 400 
B) 500 
C) 600 
D) 800 
A) 400 
B) 500 
C) 600 
D) 800

Question 2

If a firm expects that the price of its product will be lower in the future than it is today

Accepted Answer

A) the firm has an incentive to increase supply now and decrease supply in the future. 
B) the firm has an incentive to decrease supply now and increase supply in the future. 
C) the firm has an incentive to increase quantity supplied now and decrease quantity supplied in the future. 
D) the firm will not change supply until it knows for certain what will happen to its price. 
A) the firm has an incentive to increase supply now and decrease supply in the future. 
B) the firm has an incentive to decrease supply now and increase supply in the future. 
C) the firm has an incentive to increase quantity supplied now and decrease quantity supplied in the future. 
D) the firm will not change supply until it knows for certain what will happen to its price.

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 there is an increase in the wages of motorcycle workers and an increase in the price of motorcycle insurance,a complement to motorcycles,the equilibrium could move to which point?

Accepted Answer

A) A 
B) B 
C) C 
D) E 
A) A 
B) B 
C) C 
D) E

Question 4

If consumers believe the price of tablet computers will increase in the future,this will cause the demand for tablet computers to decrease now.

Accepted Answer

A) True 
 B)False

Question 5

In response to a shortage the market price of a good will rise;as the price rises,the demand will decrease and supply will increase until equilibrium is reached.

Accepted Answer

A) True 
 B)False

Question 6

What is a surplus? What is a shortage?

Accepted Answer

A surplus is a situation in wh

Question 7

The income effect of a price change results in a

Accepted Answer

A) shift of the demand curve when income changes. 
B) movement along the demand curve due to a change in relative prices. 
C) shift of the demand curve due to a change in purchasing power brought about by the price change. 
D) movement along the demand curve due to a change in purchasing power brought about by the price change. 
A) shift of the demand curve when income changes. 
B) movement along the demand curve due to a change in relative prices. 
C) shift of the demand curve due to a change in purchasing power brought about by the price change. 
D) movement along the demand curve due to a change in purchasing power brought about by the price change.

Question 8

Suppose consumer preference for beef starts to rise while the cost of raising beef continues to rise.In the market for beef,this would be represented by the equilibrium price ________ and the equilibrium quantity ________.

Accepted Answer

A) increasing;increasing or decreasing 
B) decreasing;increasing or decreasing 
C) increasing or decreasing;increasing 
D) increasing or decreasing;decreasing 
A) increasing;increasing or decreasing 
B) decreasing;increasing or decreasing 
C) increasing or decreasing;increasing 
D) increasing or decreasing;decreasing

Question 9

A decrease in the price of inputs will cause the supply curve for a product to shift to the right.

Accepted Answer

A) True 
 B)False

Question 10

In September,buyers of silver expect that the price of silver will rise in October.What happens in the silver market in September,holding all else constant?

Accepted Answer

A) The quantity demanded decreases. 
B) The demand curve shifts to the left. 
C) The demand curve shifts to the right. 
D) The quantity demanded increases. 
A) The quantity demanded decreases. 
B) The demand curve shifts to the left. 
C) The demand curve shifts to the right. 
D) The quantity demanded increases.

Question 11

The phrase "demand has increased" means that

Accepted Answer

A) a demand curve has shifted to the left. 
B) there has been an upward movement along a demand curve. 
C) there has been a downward movement along a demand curve. 
D) a demand curve has shifted to the right. 
A) a demand curve has shifted to the left. 
B) there has been an upward movement along a demand curve. 
C) there has been a downward movement along a demand curve. 
D) a demand curve has shifted to the right.

Question 12

A positive technological change will cause the quantity of a good supplied to increase.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following will not shift the demand curve for a good?

Accepted Answer

A) an increase in population 
B) an increase in the price of the good 
C) a decrease in the price of a substitute good 
D) an increase in consumer incomes 
A) an increase in population 
B) an increase in the price of the good 
C) a decrease in the price of a substitute good 
D) an increase in consumer incomes

Question 14

If,in response to a decrease in the price of coffee,the quantity of coffee demanded increases,economists would describe this as

Accepted Answer

A) an increase in demand. 
B) an increase in quantity demanded. 
C) a change in consumer income. 
D) an increase in consumers' taste for coffee. 
A) an increase in demand. 
B) an increase in quantity demanded. 
C) a change in consumer income. 
D) an increase in consumers' taste for coffee.

Question 15

Figure 3-5  
-Refer to Figure 3-5.At a price of $5,

Accepted Answer

A) there is a surplus of 4 units. 
B) there is a scarcity of 4 units. 
C) there is a shortage of 6 units. 
D) there is a shortage of 4 units. 
A) there is a surplus of 4 units. 
B) there is a scarcity of 4 units. 
C) there is a shortage of 6 units. 
D) there is a shortage of 4 units.

Question 16

Figure 3-2  
-Refer to Figure 3-2.A technological advancement would be represented by a movement from

Accepted Answer

A) A to B. 
B) B to A. 
C) S1 to S2. 
D) S2 to S1. 
A) A to B. 
B) B to A. 
C) S1 to S2. 
D) S2 to S1.

Question 17

If in the market for bananas the supply curve has shifted to the right,then

Accepted Answer

A) the supply of bananas increased. 
B) the quantity of bananas supplied has increased. 
C) the supply of bananas has decreases. 
D) the quantity of bananas supplied has decreased. 
A) the supply of bananas increased. 
B) the quantity of bananas supplied has increased. 
C) the supply of bananas has decreases. 
D) the quantity of bananas supplied has decreased.

Question 18

Hurricane Katrina damaged a large portion of oil refining and pipeline capacity in the Gulf coast states.In the market for gasoline,

Accepted Answer

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

Question 19

If the price of prime rib falls,the income effect due to the price change will cause

Accepted Answer

A) an increase in the demand for prime rib. 
B) an increase in the demand for flank steak,a substitute for prime rib. 
C) an increase in the quantity of prime rib demanded. 
D) an increase in the quantity of prime rib supplied. 
A) an increase in the demand for prime rib. 
B) an increase in the demand for flank steak,a substitute for prime rib. 
C) an increase in the quantity of prime rib demanded. 
D) an increase in the quantity of prime rib supplied.

Question 20

Figure 3-7  
-Refer to Figure 3-7.Assume that the graphs in this figure represent the demand and supply curves for ramen noodles,an inferior good.Which panel describes what happens in this market as a result of an increase in income?

Accepted Answer

A) Panel (a) 
B) Panel (b) 
C) Panel (c) 
D) Panel (d) 
A) Panel (a) 
B) Panel (b) 
C) Panel (c) 
D) Panel (d)

Figure 3-4 -Refer to Figure 3-4.At a price of $25,how many units will be sold?

If a firm expects that the price of its product will be lower in the future than it is today

If consumers believe the price of tablet computers will increase in the future,this will cause the demand for tablet computers to decrease now.

In response to a shortage the market price of a good will rise;as the price rises,the demand will decrease and supply will increase until equilibrium is reached.

What is a surplus? What is a shortage?

The income effect of a price change results in a

Suppose consumer preference for beef starts to rise while the cost of raising beef continues to rise.In the market for beef,this would be represented by the equilibrium price and the equilibrium quantity .

A decrease in the price of inputs will cause the supply curve for a product to shift to the right.

In September,buyers of silver expect that the price of silver will rise in October.What happens in the silver market in September,holding all else constant?

The phrase "demand has increased" means that

A positive technological change will cause the quantity of a good supplied to increase.

Which of the following will not shift the demand curve for a good?

If,in response to a decrease in the price of coffee,the quantity of coffee demanded increases,economists would describe this as

Figure 3-5 -Refer to Figure 3-5.At a price of $5,

Figure 3-2 -Refer to Figure 3-2.A technological advancement would be represented by a movement from

If in the market for bananas the supply curve has shifted to the right,then

Hurricane Katrina damaged a large portion of oil refining and pipeline capacity in the Gulf coast states.In the market for gasoline,

If the price of prime rib falls,the income effect due to the price change will cause

Figure 3-7 -Refer to Figure 3-7.Assume that the graphs in this figure represent the demand and supply curves for ramen noodles,an inferior good.Which panel describes what happens in this market as a result of an increase in income?

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Economic Efficiency,government Price Setting,and Taxes

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Comparative Advantage and the Gains From International Trade

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

Filters

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

Figure 3-4 -Refer to Figure 3-4.At a price of $25,how many units will be sold?

If a firm expects that the price of its product will be lower in the future than it is today

If consumers believe the price of tablet computers will increase in the future,this will cause the demand for tablet computers to decrease now.

In response to a shortage the market price of a good will rise;as the price rises,the demand will decrease and supply will increase until equilibrium is reached.

What is a surplus? What is a shortage?

The income effect of a price change results in a

Suppose consumer preference for beef starts to rise while the cost of raising beef continues to rise.In the market for beef,this would be represented by the equilibrium price ________ and the equilibrium quantity ________.

A decrease in the price of inputs will cause the supply curve for a product to shift to the right.

In September,buyers of silver expect that the price of silver will rise in October.What happens in the silver market in September,holding all else constant?

The phrase "demand has increased" means that

A positive technological change will cause the quantity of a good supplied to increase.

Which of the following will not shift the demand curve for a good?

If,in response to a decrease in the price of coffee,the quantity of coffee demanded increases,economists would describe this as

Figure 3-5 -Refer to Figure 3-5.At a price of $5,

Figure 3-2 -Refer to Figure 3-2.A technological advancement would be represented by a movement from

If in the market for bananas the supply curve has shifted to the right,then

Hurricane Katrina damaged a large portion of oil refining and pipeline capacity in the Gulf coast states.In the market for gasoline,

If the price of prime rib falls,the income effect due to the price change will cause

Figure 3-7 -Refer to Figure 3-7.Assume that the graphs in this figure represent the demand and supply curves for ramen noodles,an inferior good.Which panel describes what happens in this market as a result of an increase in income?

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Economic Efficiency,government Price Setting,and Taxes

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Comparative Advantage and the Gains From International Trade

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

Filters

Suppose consumer preference for beef starts to rise while the cost of raising beef continues to rise.In the market for beef,this would be represented by the equilibrium price and the equilibrium quantity .