Question 1

The law of demand says that when price falls, quantity demanded increases.

Accepted Answer

A) True 
 B)False

Question 2

Demand for airline travel usually increases during the summer. One explanation is that

Accepted Answer

A)  VIA Rail offers price discounts during the summer. 
B)  consumer incomes are lower in the summer and airline travel is a normal good. 
C)  consumer incomes are higher in the summer and airline travel is an inferior good. 
D)  there are more customers during the summer. 
E)  hotel prices rise during the summer. 
A)  VIA Rail offers price discounts during the summer. 
B)  consumer incomes are lower in the summer and airline travel is a normal good. 
C)  consumer incomes are higher in the summer and airline travel is an inferior good. 
D)  there are more customers during the summer. 
E)  hotel prices rise during the summer.

Question 3

A successful advertising campaign can affect your ability to pay for a product or service.

Accepted Answer

A) True 
 B)False

Question 4

If the price of gasoline continues to rise, the

Accepted Answer

A)  demand for substitutes for gasoline decreases. 
B)  quantity demanded for substitutes for gasoline increases. 
C)  quantity demanded of gasoline increases. 
D)  demand for gasoline decreases. 
E)  quantity demanded of gasoline decreases. 
A)  demand for substitutes for gasoline decreases. 
B)  quantity demanded for substitutes for gasoline increases. 
C)  quantity demanded of gasoline increases. 
D)  demand for gasoline decreases. 
E)  quantity demanded of gasoline decreases.

Question 5

Dry cleaners charge men a lower price than they charge women because men get lower marginal benefits than women from having clean clothes.

Accepted Answer

A) True 
 B)False

Question 6

As the price of a product or service rises, smart consumers switch to cheaper substitutes and quantity demanded decreases.

Accepted Answer

A) True 
 B)False

Question 7

If you spend the next hour studying instead of going out with a friend, that means at the margin, you value studying more than your friend.

Accepted Answer

A) True 
 B)False

Question 8

Some sales managers are talking about business. Which quotation refers to a change in quantity demanded?

Accepted Answer

A)  "Since our competitors raised their prices, our sales have tripled." 
B)  "Because it's been such a warm winter, our sales of wool scarves are down from last year." 
C)  "We decided to cut our prices, and there has been a big increase in our sales." 
D)  "The Green movement has made our biodegradable products best-sellers." 
E)  None of the above 
A)  "Since our competitors raised their prices, our sales have tripled." 
B)  "Because it's been such a warm winter, our sales of wool scarves are down from last year." 
C)  "We decided to cut our prices, and there has been a big increase in our sales." 
D)  "The Green movement has made our biodegradable products best-sellers." 
E)  None of the above

Question 9

A successful advertising campaign can affect your willingness to pay for a product or service.

Accepted Answer

A) True 
 B)False

Question 10

When Wendy's runs a successful television ad for their new Baconator Hamburger,

Accepted Answer

A)  demand for hamburgers at McDonald's increases. 
B)  consumer incomes increase. 
C)  demand for french fries at Wendy's increases because these are complementary products. 
D)  demand for french fries at Wendy's decreases because these are complementary products. 
E)  consumer incomes decrease. 
A)  demand for hamburgers at McDonald's increases. 
B)  consumer incomes increase. 
C)  demand for french fries at Wendy's increases because these are complementary products. 
D)  demand for french fries at Wendy's decreases because these are complementary products. 
E)  consumer incomes decrease.

Question 11

A second date is never as exciting as the first one because total benefits decrease as you date more.

Accepted Answer

A) True 
 B)False

Question 12

The demand curves shifts ________ if consumers' incomes ________ and this is a ________ good.

Accepted Answer

A)  rightward; decrease; normal 
B)  rightward; increase; inferior 
C)  rightward; decrease; inferior 
D)  leftward; increase; normal 
E)  leftward; decrease; inferior 
A)  rightward; decrease; normal 
B)  rightward; increase; inferior 
C)  rightward; decrease; inferior 
D)  leftward; increase; normal 
E)  leftward; decrease; inferior

Question 13

Consumers economize on products and services that become more expensive by switching to complements.

Accepted Answer

A) True 
 B)False

Question 14

The law of demand works because of the availability of substitutes.

Accepted Answer

A) True 
 B)False

Question 15

Which will cause a movement down along a demand curve?

Accepted Answer

A)  a rise in the price of a substitute product 
B)  a fall in the price of a complement product 
C)  an increase in income 
D)  a rise in the price of the product 
E)  a fall in the price of the product 
A)  a rise in the price of a substitute product 
B)  a fall in the price of a complement product 
C)  an increase in income 
D)  a rise in the price of the product 
E)  a fall in the price of the product

Question 16

An increase in demand is represented by a

Accepted Answer

A)  rightward shift of the supply curve. 
B)  rightward shift of the demand curve. 
C)  leftward shift of the demand curve. 
D)  movement up along the demand curve. 
E)  movement down along the demand curve. 
A)  rightward shift of the supply curve. 
B)  rightward shift of the demand curve. 
C)  leftward shift of the demand curve. 
D)  movement up along the demand curve. 
E)  movement down along the demand curve.

Question 17

When you download music for free, you have a demand for music.

Accepted Answer

A) True 
 B)False

Question 18

Phone data plans often charge a high price for daytime use and a lower price on evenings and weekends. An economist would say this is because

Accepted Answer

A)  total benefits decrease as you use more minutes. 
B)  it is less expensive to provide service when it is dark outside. 
C)  marginal benefits increase as you talk longer. 
D)  not many people have cell phones these days. 
E)  marginal benefits can decrease as circumstances change. 
A)  total benefits decrease as you use more minutes. 
B)  it is less expensive to provide service when it is dark outside. 
C)  marginal benefits increase as you talk longer. 
D)  not many people have cell phones these days. 
E)  marginal benefits can decrease as circumstances change.

Question 19

An economics professor offers to sell cookies to her class. At a price of 50 cents per cookie, each of the 100 students in the class spends $2.00 on cookies. At a price of 50 cents per cookie, market demand in this class is

Accepted Answer

A)  400 cookies. 
B)  50 cents. 
C)  100 students. 
D)  1 professor. 
E)  200 dollars. 
A)  400 cookies. 
B)  50 cents. 
C)  100 students. 
D)  1 professor. 
E)  200 dollars.

Question 20

What you can afford is just about money.

Accepted Answer

A) True 
 B)False

The law of demand says that when price falls, quantity demanded increases.

Demand for airline travel usually increases during the summer. One explanation is that

A successful advertising campaign can affect your ability to pay for a product or service.

If the price of gasoline continues to rise, the

Dry cleaners charge men a lower price than they charge women because men get lower marginal benefits than women from having clean clothes.

As the price of a product or service rises, smart consumers switch to cheaper substitutes and quantity demanded decreases.

If you spend the next hour studying instead of going out with a friend, that means at the margin, you value studying more than your friend.

Some sales managers are talking about business. Which quotation refers to a change in quantity demanded?

A successful advertising campaign can affect your willingness to pay for a product or service.

When Wendy's runs a successful television ad for their new Baconator Hamburger,

A second date is never as exciting as the first one because total benefits decrease as you date more.

The demand curves shifts if consumers' incomes and this is a good.

Consumers economize on products and services that become more expensive by switching to complements.

The law of demand works because of the availability of substitutes.

Which will cause a movement down along a demand curve?

An increase in demand is represented by a

When you download music for free, you have a demand for music.

Phone data plans often charge a high price for daytime use and a lower price on evenings and weekends. An economist would say this is because

An economics professor offers to sell cookies to her class. At a price of 50 cents per cookie, each of the 100 students in the class spends $2.00 on cookies. At a price of 50 cents per cookie, market demand in this class is

What you can afford is just about money.

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

Show Me the Money: the Law of Supply

Coordinating Smart Choices: Demand and 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 2: Making Smart Choices: the Law of Demand

The law of demand says that when price falls, quantity demanded increases.

Demand for airline travel usually increases during the summer. One explanation is that

A successful advertising campaign can affect your ability to pay for a product or service.

If the price of gasoline continues to rise, the

Dry cleaners charge men a lower price than they charge women because men get lower marginal benefits than women from having clean clothes.

As the price of a product or service rises, smart consumers switch to cheaper substitutes and quantity demanded decreases.

If you spend the next hour studying instead of going out with a friend, that means at the margin, you value studying more than your friend.

Some sales managers are talking about business. Which quotation refers to a change in quantity demanded?

A successful advertising campaign can affect your willingness to pay for a product or service.

When Wendy's runs a successful television ad for their new Baconator Hamburger,

A second date is never as exciting as the first one because total benefits decrease as you date more.

The demand curves shifts ________ if consumers' incomes ________ and this is a ________ good.

Consumers economize on products and services that become more expensive by switching to complements.

The law of demand works because of the availability of substitutes.

Which will cause a movement down along a demand curve?

An increase in demand is represented by a

When you download music for free, you have a demand for music.

Phone data plans often charge a high price for daytime use and a lower price on evenings and weekends. An economist would say this is because

An economics professor offers to sell cookies to her class. At a price of 50 cents per cookie, each of the 100 students in the class spends $2.00 on cookies. At a price of 50 cents per cookie, market demand in this class is

What you can afford is just about money.

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

Show Me the Money: the Law of Supply

Coordinating Smart Choices: Demand and 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

The demand curves shifts if consumers' incomes and this is a good.