Question 1

Figure 4.5.1
-Look at the demand curve in Figure 4.5.1. If the price of the product is $4, what is the consumer surplus from the 3rd unit?

Accepted Answer

A)  $0 
B)  $1 
C)  $2 
D)  $3 
E)  $4 
A)  $0 
B)  $1 
C)  $2 
D)  $3 
E)  $4 C

Question 2

If bus fares fall but fewer people are riding the bus, it is likely that

Accepted Answer

A)  the bus company is incompetent. 
B)  demand decreased. 
C)  supply decreased. 
D)  demand increased. 
E)  supply increased. 
A)  the bus company is incompetent. 
B)  demand decreased. 
C)  supply decreased. 
D)  demand increased. 
E)  supply increased. B

Question 3

When a market is in equilibrium, the market-clearing quantity bought and sold equals the quantity demanded at the equilibrium price.

Accepted Answer

A) True 
 B)False  True

Question 4

Property rights

Accepted Answer

A)  are easy to implement in large countries. 
B)  were recently eliminated in Australia. 
C)  are only important in the city. 
D)  are legally enforceable guarantees of ownership. 
E)  are not important in the market. 
A)  are easy to implement in large countries. 
B)  were recently eliminated in Australia. 
C)  are only important in the city. 
D)  are legally enforceable guarantees of ownership. 
E)  are not important in the market.

Question 5

Figure 4.5.2
-Figure 4.5.2 shows marginal costs for Betsy's Butter business. If Betsy sells the third unit of butter for $6, what is her producer surplus on the 3rd unit?

Accepted Answer

A)  $3 
B)  $6 
C)  $5 
D)  $4 
E)  $2 
A)  $3 
B)  $6 
C)  $5 
D)  $4 
E)  $2

Question 6

A market is defined as a place where trades occur.

Accepted Answer

A) True 
 B)False

Question 7

At the quantity of an efficient market outcome, marginal benefit equals marginal cost.

Accepted Answer

A) True 
 B)False

Question 8

If the price of Pepsi rises, we expect the price of pizza to rise because Pepsi and pizza are complements.

Accepted Answer

A) True 
 B)False

Question 9

If the market for Twinkies is in equilibrium, then

Accepted Answer

A)  Twinkies must be a normal good. 
B)  businesses would like to sell more at the current price. 
C)  consumers would like to buy more at the current price. 
D)  there is a surplus. 
E)  the quantity demanded equals the quantity supplied. 
A)  Twinkies must be a normal good. 
B)  businesses would like to sell more at the current price. 
C)  consumers would like to buy more at the current price. 
D)  there is a surplus. 
E)  the quantity demanded equals the quantity supplied.

Question 10

Taxi operators must buy a medallion from the municipal government. If the price of these medallions rises, we expect the fares charged by taxi operators to ________ because ________.

Accepted Answer

A)  rise; higher input prices decrease supply 
B)  rise; higher input price increase demand 
C)  rise; there would be more taxis 
D)  fall; taxi rides are a luxury service 
E)  fall; passengers substitute bus rides 
A)  rise; higher input prices decrease supply 
B)  rise; higher input price increase demand 
C)  rise; there would be more taxis 
D)  fall; taxi rides are a luxury service 
E)  fall; passengers substitute bus rides

Question 11

The introduction of a cost-saving technology at the espresso bar causes the price of an espresso to

Accepted Answer

A)  fall, and demand decreases. 
B)  fall, and quantity demanded increases. 
C)  fall, and quantity demanded decreases. 
D)  rise, and quantity demanded decreases. 
E)  rise, and quantity demanded increases. 
A)  fall, and demand decreases. 
B)  fall, and quantity demanded increases. 
C)  fall, and quantity demanded decreases. 
D)  rise, and quantity demanded decreases. 
E)  rise, and quantity demanded increases.

Question 12

Figure 4.2.3.
-Look at Figure 4.2.3. At a price of $12, how many units are sold in the market?

Accepted Answer

A)  20 units 
B)  30 units 
C)  40 units 
D)  zero units 
E)  none of the above 
A)  20 units 
B)  30 units 
C)  40 units 
D)  zero units 
E)  none of the above

Question 13

There is a shortage when quantity supplied exceeds quantity demanded.

Accepted Answer

A) True 
 B)False

Question 14

Figure 4.2.2
The Market for Robotic Rubber Ducks
    
-Look at Table 4.2.2. Consumers learn that rubber ducks wear out batteries quickly. As a result, demand decreases by 100 rubber ducks at each price. The new equilibrium price is $________ and the new equilibrium quantity is ________ rubber ducks.

Accepted Answer

A)  70; 450 
B)  70; 350 
C)  50; 450 
D)  50; 350 
E)  60; 400 
A)  70; 450 
B)  70; 350 
C)  50; 450 
D)  50; 350 
E)  60; 400

Question 15

In a market economy,

Accepted Answer

A)  prices are set by businesses alone. 
B)  businesses adjust prices more often than quantities. 
C)  prices are determined by the interaction of demand and supply. 
D)  consumers must buy at the prices businesses set. 
E)  the government determines prices. 
A)  prices are set by businesses alone. 
B)  businesses adjust prices more often than quantities. 
C)  prices are determined by the interaction of demand and supply. 
D)  consumers must buy at the prices businesses set. 
E)  the government determines prices.

Question 16

When a market is in equilibrium, consumers who are not willing to pay the market-clearing price have not made a smart choice.

Accepted Answer

A) True 
 B)False

Question 17

Figure 4.2.1
Market Demand and Supply for Pet Rocks
  
-Look at Figure 4.2.1. At a price of $3,

Accepted Answer

A)  the market is in equilibrium. 
B)  there is a surplus of 180. 
C)  there is a shortage of 180. 
D)  there is pressure for the price to fall. 
E)  inventories increase by 180. 
A)  the market is in equilibrium. 
B)  there is a surplus of 180. 
C)  there is a shortage of 180. 
D)  there is pressure for the price to fall. 
E)  inventories increase by 180.

Question 18

If sellers expect the price of beef will rise in the future, the price of beef on today's market

Accepted Answer

A)  rises and quantity demanded decreases. 
B)  falls and quantity supplied increases. 
C)  falls and quantity demanded increases. 
D)  rises and quantity supplied decreases. 
E)  falls and quantity demanded decreases. 
A)  rises and quantity demanded decreases. 
B)  falls and quantity supplied increases. 
C)  falls and quantity demanded increases. 
D)  rises and quantity supplied decreases. 
E)  falls and quantity demanded decreases.

Question 19

When consumers' incomes increase, the price of an inferior product or service rises.

Accepted Answer

A) True 
 B)False

Question 20

Consumer surplus is the area under the marginal benefit curve but above the market price.

Accepted Answer

A) True 
 B)False

Figure 4.5.1 -Look at the demand curve in Figure 4.5.1. If the price of the product is $4, what is the consumer surplus from the 3rd unit?

If bus fares fall but fewer people are riding the bus, it is likely that

When a market is in equilibrium, the market-clearing quantity bought and sold equals the quantity demanded at the equilibrium price.

Property rights

Figure 4.5.2 -Figure 4.5.2 shows marginal costs for Betsy's Butter business. If Betsy sells the third unit of butter for $6, what is her producer surplus on the 3rd unit?

A market is defined as a place where trades occur.

At the quantity of an efficient market outcome, marginal benefit equals marginal cost.

If the price of Pepsi rises, we expect the price of pizza to rise because Pepsi and pizza are complements.

If the market for Twinkies is in equilibrium, then

Taxi operators must buy a medallion from the municipal government. If the price of these medallions rises, we expect the fares charged by taxi operators to because .

The introduction of a cost-saving technology at the espresso bar causes the price of an espresso to

Figure 4.2.3. -Look at Figure 4.2.3. At a price of $12, how many units are sold in the market?

There is a shortage when quantity supplied exceeds quantity demanded.

Figure 4.2.2 The Market for Robotic Rubber Ducks -Look at Table 4.2.2. Consumers learn that rubber ducks wear out batteries quickly. As a result, demand decreases by 100 rubber ducks at each price. The new equilibrium price is $ and the new equilibrium quantity is rubber ducks.

In a market economy,

When a market is in equilibrium, consumers who are not willing to pay the market-clearing price have not made a smart choice.

Figure 4.2.1 Market Demand and Supply for Pet Rocks -Look at Figure 4.2.1. At a price of $3,

If sellers expect the price of beef will rise in the future, the price of beef on today's market

When consumers' incomes increase, the price of an inferior product or service rises.

Consumer surplus is the area under the marginal benefit curve but above the market price.

Whats in Economics for You Scarcity, Opportunity Cost, Trade, and Models

Making Smart Choices: the Law of Demand

Show Me the Money: the Law of Supply

Are Your Smart Choices Smart for All Macroeconomics and Microeconomics

Up Around the Circular Flow: Gdp, Economic Growth, and Business Cycles

Costs of Not Working and Living: Unemployment and Inflation

Skating to Where the Puck Is Going: Aggregate Supply and Aggregate Demand

Money Is for Lunatics: Demanders and Suppliers of Money

Trading Dollars for Dollars Exchange Rates and Payments With the Rest of the World

Steering Blindly Monetary Policy and the Bank of Canada

Spending Others Money: Fiscal Policy, Deficits, and National Debt

Are Sweatshops All Bad Globalization and Trade Policy

Filters

Exam 4: Coordinating Smart Choices: Demand and Supply

Figure 4.5.1 -Look at the demand curve in Figure 4.5.1. If the price of the product is $4, what is the consumer surplus from the 3rd unit?

If bus fares fall but fewer people are riding the bus, it is likely that

When a market is in equilibrium, the market-clearing quantity bought and sold equals the quantity demanded at the equilibrium price.

Property rights

Figure 4.5.2 -Figure 4.5.2 shows marginal costs for Betsy's Butter business. If Betsy sells the third unit of butter for $6, what is her producer surplus on the 3rd unit?

A market is defined as a place where trades occur.

At the quantity of an efficient market outcome, marginal benefit equals marginal cost.

If the price of Pepsi rises, we expect the price of pizza to rise because Pepsi and pizza are complements.

If the market for Twinkies is in equilibrium, then

Taxi operators must buy a medallion from the municipal government. If the price of these medallions rises, we expect the fares charged by taxi operators to ________ because ________.

The introduction of a cost-saving technology at the espresso bar causes the price of an espresso to

Figure 4.2.3. -Look at Figure 4.2.3. At a price of $12, how many units are sold in the market?

There is a shortage when quantity supplied exceeds quantity demanded.

Figure 4.2.2 The Market for Robotic Rubber Ducks -Look at Table 4.2.2. Consumers learn that rubber ducks wear out batteries quickly. As a result, demand decreases by 100 rubber ducks at each price. The new equilibrium price is $________ and the new equilibrium quantity is ________ rubber ducks.

In a market economy,

When a market is in equilibrium, consumers who are not willing to pay the market-clearing price have not made a smart choice.

Figure 4.2.1 Market Demand and Supply for Pet Rocks -Look at Figure 4.2.1. At a price of $3,

If sellers expect the price of beef will rise in the future, the price of beef on today's market

When consumers' incomes increase, the price of an inferior product or service rises.

Consumer surplus is the area under the marginal benefit curve but above the market price.

Whats in Economics for You Scarcity, Opportunity Cost, Trade, and Models

Making Smart Choices: the Law of Demand

Show Me the Money: the Law of Supply

Are Your Smart Choices Smart for All Macroeconomics and Microeconomics

Up Around the Circular Flow: Gdp, Economic Growth, and Business Cycles

Costs of Not Working and Living: Unemployment and Inflation

Skating to Where the Puck Is Going: Aggregate Supply and Aggregate Demand

Money Is for Lunatics: Demanders and Suppliers of Money

Trading Dollars for Dollars Exchange Rates and Payments With the Rest of the World

Steering Blindly Monetary Policy and the Bank of Canada

Spending Others Money: Fiscal Policy, Deficits, and National Debt

Are Sweatshops All Bad Globalization and Trade Policy

Filters

Taxi operators must buy a medallion from the municipal government. If the price of these medallions rises, we expect the fares charged by taxi operators to because .

Figure 4.2.2 The Market for Robotic Rubber Ducks -Look at Table 4.2.2. Consumers learn that rubber ducks wear out batteries quickly. As a result, demand decreases by 100 rubber ducks at each price. The new equilibrium price is $ and the new equilibrium quantity is rubber ducks.