Deck 3: Supply and Demand

Question 1

In much of the country, homeowners choose to heat their houses with either natural gas or home heating oil.Which of the following would cause a change in the demand for natural gas?
A.a change in the price of home
B.heating oil a change in income
C.an increase in consumer tastes for natural gas as an energy
D.source all of the above

Answer 1

all of the above

Question 2

The law of demand is illustrated by a demand curve that is:
A.horizontal.
B.downward sloping.
C.vertical.
D.upward sloping.

Answer 2

downward sloping.

Question 3

Which of the following will not cause an increase in demand for good X?

A)a decrease in income if good X is an inferior good
B)an increase in income if good X is a normal good
C)a decrease in the price of good X
D)an increase in consumers' taste for good X

Answer 3

C

Question 4

________ illustrates an inverse relationship between price and quantity.
A.A demand curve
B.A supply curve
C.A production possibility
D.frontier Equilibrium

Question 5

Which of the following factors would cause a movement along the demand curve for a particular good?
A.a change in the prices of related goods
B.a change in the price of that good
C.a change in the size of the population
D.both a change in the price of that good and a change in the size of the population

Question 6

A negative relationship between the quantity demanded and price is called the law of:
A.demand.
B.increasing returns.
C.market clearing.
D.supply.

Question 7

A decrease in the price of eggs will result in:
A.an increase in the demand for eggs.
B.an increase in the supply of eggs.
C.an increase in the quantity of eggs supplied.
D.an increase in the quantity of eggs demanded.

Question 8

When the economy suffers a downturn and the incomes of many people decrease, vacationers are more likely to take car trips than to fly.Which of the following provides one possible explanation for this phenomenon?
A.Air travel and vacation travel by car are complementary goods.
B.Air travel and vacation travel by car are both normal goods.
C.Air travel is a normal good and vacation travel by car is an inferior good.
D.Air travel is an inferior good and vacation travel by car is a normal good.

Question 9

The law of demand implies that:
A.consumers are not responsive to price changes.
B.consumers will buy more at lower prices.
C.sellers will offer more on the market at higher prices.
D.sellers will offer less on the market at lower prices.

Question 10

Over the past several years, consumers have had an increasing interest in getting a tattoo.This means that the ________ for tattoos has _.
A.quantity demanded; increased
B.demand; decreased
C.demand; increased
D.quantity demanded; decreased

Question 11

A shift of the demand curve for thin-crust pizza would not be caused by a change in:

A)buyers' incomes.
B)the price of thin-crust pizza.
C)the price of thick-crust pizza.
D)the popularity of thin-crust pizza.

Question 12

Which of the following examples illustrates the law of demand? An increase in tuition encourages more students to enroll in college because the

A)quality of education has risen.
B)Consumers buy more personal computers because prices have fallen.
C)Oil companies drill for new sources of oil because oil prices are
D)higher.Fewer people play golf because incomes are lower.

Question 13

The law of demand states that other things equal:
A.as the price increases, the quantity demanded will increase.
B.as the price decreases, the demand curve will shift to the right.
C.as the price increases, the demand will decrease.
D.as the price increases, the quantity demanded will decrease.

Question 14

The market for corn in Kansas is considered to be competitive.This means there are ________
buyers and sellers of corn in Kansas.
A.many; few
B.few; many
C.many; many
D.few; few

Question 15

Raclette is a popular wintertime dish in Switzerland.It is essentially melted Raclette cheese over boiled new potatoes.If the price of Raclette cheese decreased, we would expect to see:
A.an increase in demand for Raclette cheese.
B.an increase in demand for new potatoes.
C.no effect on the demand for either of the Raclette ingredients, since this is a traditional dish and its consumption does not depend on the prices of the ingredients.
D.an increase in demand for Raclette cheese and for new potatoes.

Question 16

Which of the following statements is correct?
A.A change in demand is a movement along the demand curve, and a change in quantity demanded is a shift of the demand curve.
B.Both a change in quantity demanded and a change in demand are movements along the demand curve, only in different directions.
C.Both a change in quantity demanded and a change in demand are shifts of the demand curve, only in different directions.
D.A change in quantity demanded is a movement along the demand curve, and a change in demand is a shift of the demand curve.

Question 17

A negative relationship between the quantity demanded and price is called the law of _.
A.demand
B.marginality
C.efficienc
D.y supply

Question 18

Which of the following best describes the law of demand?
A.As income taxes rise, fewer new cars are purchased.
B.As the price of corn rises, more acres of corn are planted.
C.As the price of a DVD rental rises, fewer DVDs are rented.
D.As the population rises, more electricity is consumed.

Question 19

The apples will decrease when apple prices rise.
A.demand for
B.quantity demanded of
C.supply of
D.equilibrium of

Question 20

A decrease in the price of a good will result in:

A)an increase in demand.
B)an increase in supply.
C)an increase in the quantity demanded.
D)more being supplied.

Question 21

The demand for meals at a local Applebee's will shift to the left if:
A.the Olive Garden offers a 10% discount coupon in the local newspaper.
B.the price of a meal at Applebee's rises.
C.local incomes increase and Applebee's is a normal good.
D.the price of gasoline falls in the local area.

Question 22

An increase in the demand for gasoline today caused by concerns that gasoline prices will be higher tomorrow is most likely attributable to which of the following?
A.income
B.consumer expectations
C.consumer preferences
D.prices of other goods

Question 23

Which will not increase demand for desktop computers?
A.an increase in the incomes of computer
B.users cool new computer games
C.Dell Computers going out of business
D.the price of notebook computers increasing

Question 24

Pizza is a normal good.If students' incomes at your college increase, the effect on pizza would be:
A.an increase in the demand.
B.an increase in the quantity demanded.
C.a decrease in the demand.
D.no change in the demand.

Question 25

Which of the following would shift the demand curve for new textbooks to the right?

A)a decrease in the price of paper
B)a fall in the price of used textbooks
C)an increase in college enrollment
D)a fall in the price of new textbooks

Question 26

The demand curve for videos has shifted to the right.What could have caused it?

A)a fall in the price of videos
B)an increase in the price of videos
C)an increase in the supply of videos
D)an increase in the incomes of buyers

Question 27

If chicken and beef are substitutes, then a fall in the price of chicken will bring about:
A.an increase in the demand for beef.
B.a decrease in the demand for beef.
C.a decrease in the quantity demanded of beef.
D.no change in the demand for beef.

Question 28

An increase in the price of hamburger would probably result in in the demand for
hamburger buns.
A.a decrease
B.an increase
C.no change
D.random fluctuations

Question 29

After graduation from college, you might have an increase in your income from a new job.If, as a result, you decide that you will purchase more T-bone steak and less hamburger, then for you hamburger would be considered:
A.a normal good.
B.a substitute good.
C.a complementary good.
D.an inferior good.

Question 30

Which of the following describes two goods that are most likely substitutes in consumption?

A)loaves of bread and sticks of butter
B)loaves of bread and toasters
C)loaves of bread and hamburger buns
D)loaves of bread and gasoline

Question 31

For most goods, purchases tend to rise with increases in buyers' incomes and to fall with decreases in buyers' incomes.Such goods are known as:
A.inferior goods.
B.direct goods.
C.normal goods.
D.indirect goods.

Question 32

If steak and potatoes are complements, when the price of steak goes up, the demand curve for potatoes:
A.shifts to the right.
B.shifts to the left.
C.stays the same.
D.shifts to the right and then moves back.

Question 33

Which of the following is likely to cause a rightward shift in the demand for home-delivered pizza?
A.a lower price of pizza
B.a lower price of fast-food hamburgers
C.a higher price of pepperoni
D.a larger population

Question 34

An announcement that smoking will harm your ability to think clearly will most likely result in:

A)an increase in the quantity of cigarettes demanded.
B)a decrease in the demand for cigarettes.
C)no change in smoking habits.
D)an increase in the price of cigarettes.

Question 35

A good is normal if which of the following is true?
A.When income increases, the demand remains unchanged.
B.When income increases, the demand decreases.
C.When income increases, the demand increases.
D.Income and the demand are unrelated.

Question 36

Which of the following best describes demand?
A.A change in demand is a movement along the demand curve, and a change in quantity demanded is a shift in the demand curve.
B.A change in quantity demanded is a movement along the demand curve, and a change in demand is a shift in the demand curve.
C.Both a change in quantity demanded and a change in demand are shifts in the demand curve, only in different directions.
D.Both a change in quantity demanded and a change in demand are movements along the demand curve, only in different directions.

Question 37

If the demand for tires goes down when the price of gas goes up, then tires and gas are:
A.substitutes.
B.complements.
C.both expensive.
D.both inexpensive.

Question 38

If people demand more of product A when the price of B falls, then A and B are:
A.not related.
B.substitutes.
C.complements.
D.inferior goods.

Question 39

An inferior good is one for which ________ in buyers' income causes _.
A.an increase; an increase in demand
B.an increase; an increase in quantity demanded
C.an increase; a decrease in demand
D.a decrease; a decrease in demand

Question 40

A good is inferior if which of the following is true?
A.When income increases, the demand remains unchanged.
B.When income increases, the demand decreases.
C.When income increases, the demand increases.
D.Income and the demand are unrelated.

Question 41

(Table: The Demand for Chocolate-Covered Peanuts) Look at the table The Demand for Chocolate-Covered Peanuts.) Barbara demands 20 bags of chocolate-covered peanuts when the price of each bag is _.
A.$0.90
B.$0.80
C.$0.70
D.$0.60

Question 42

_________ illustrates a direct relationship between price and quantity.
A.A demand curve
B.A supply curve
C.A production possibility
D.frontier Equilibrium

Question 43

(Table: The Demand for Chocolate-Covered Peanuts) Look at the table The Demand for Chocolate-Covered Peanuts.If George, Barbara, and Dan are the only three buyers in the market and the price of a bag of chocolate-covered peanuts is $0.80, the total market demand is
________ bags per month.
A.70
B.80
C.105
D.280

Question 44

When the price of lamps increases, the:

A)supply increases.
B)quantity supplied increases.
C)supply decreases.
D)quantity supplied decreases.

Question 45

Which of the following influences does not shift the supply curve?
A.people deciding that they want to buy more of the product
B.a decrease in the price firms expect to receive in the future
C.a rise in the wages paid to workers
D.the development of a new production technology

Question 46

The demand curve for running shoes has shifted to the right.What could have caused it?

A)a fall in the price of running shoes
B)an increase in the price of running shoes
C)an increase in the supply of running shoes
D)an increase in the income of buyers of running shoes

Question 47

A decrease in supply means:
A.a shift to the left of the entire supply curve.
B.a movement down the supply curve as prices go down.
C.that less will be demanded at every price.
D.that more will be supplied at every price.

Question 48

Which of the following is not a determinant of supply?

A)expectations regarding future prices
B)the technology of production
C)the cost of production
D)consumer tastes

Question 49

If the price of hamburger decreased, it would probably result in in the demand for
hamburger buns.
A.a decrease
B.an increase
C.no change
D.random fluctuations

Question 50

The typical supply curve illustrates that:
A.other things equal, the quantity supplied for a good is inversely related to the price of a good.
B.other things equal, the supply of the good creates its own demand for the good.
C.other things equal, the quantity supplied for a good is positively related to the price of a good.
D.price and quantity supplied are unrelated.

Question 51

In the local market for coffee, what would happen if Joyce's Java and Everyday Joe's coffee shops go out of business?
A.The supply curve shifts to the right.
B.The demand curve shifts to the left.
C.The supply curve shifts to the left.
D.The demand curve shifts to the right.

Question 52

The primary difference between a change in supply and a change in the quantity supplied is that:
A.a change in quantity supplied is a movement along the supply curve, while a change in supply is a shift in the supply curve.
B.both a change in quantity supplied and a change in supply are movements along the supply curve, only in different directions.
C.a change in supply is related to the supply curve, while a change in quantity supplied is related to shifts in the demand curve that elicit a change in supply.
D.a change in supply is a movement along the supply curve, while a change in quantity supplied is a shift in the supply curve.

Question 53

Which of the following will not cause an increase in the supply of good X?
A.an improvement in the technology used to produce good
B.X an increase in the price of good Y, a substitute
C.an increase in the price of inputs used to produce good X
D.a decrease in the price of inputs used to produce good X

Question 54

What will happen in the market for canned pinto beans if your income increases?
A.Demand will increase if pinto beans are an inferior good.
B.Demand will increase if pinto beans are a normal good.
C.Supply will increase if pinto beans are an inferior good.
D.Supply will increase if pinto beans are a normal good.

Question 55

When the price of gas goes down and the demand for tires goes up, a likely possibility is that tires and gas are:
A.substitutes.
B.complements.
C.both expensive.
D.both inexpensive.

Question 56

(Table: The Demand for Chocolate-Covered Peanuts) Look at the table The Demand for Chocolate-Covered Peanuts.If George, Barbara, and Dan are the only three buyers in the market and the price of a bag of chocolate-covered peanuts is $0.50, the total market demand is
________ bags per month.
A.80
B.105
C.210
D.280

Question 57

(Table: The Demand for Chocolate-Covered Peanuts.) Look at the table The Demand for Chocolate-Covered Peanuts.If the price of chocolate-covered peanuts is $0.60, the quantity demanded by George is bags per month.
A.10
B.15
C.25
D.30

Question 58

When the price of armchairs increases, the:
A.quantity supplied increases.
B.supply increases.
C.quantity supplied decreases.
D.supply decreases.

Question 59

If the price of a commodity increases, you would expect the:

A)supply to increase.
B)quantity supplied to increase.
C)quantity supplied to decrease.
D)supply curve to shift to the right.

Question 60

In the market for tacos, each of the following shifts the supply curve to the left except:
A.an increase in the price of beef.
B.an increase in the wages of taco shop workers.
C.fewer taco shops.
D.a decrease in the price of tacos.

Question 61

Which of the following will not cause an increase in the supply of cornflakes in the short run?
A.an increase in the price of cornflakes
B.a cost-saving improvement in the technology of corn production
C.a reduction in the price of corn
D.the expectation by producers that the price of cornflakes will fall in the future

Question 62

Consider the supply curve for cotton shirts.An increase in the price of cotton will:

A)increase the supply of cotton shirts.
B)decrease the supply of cotton shirts.
C)increase the quantity supplied of cotton shirts.
D)decrease the demand for cotton shirts.

Question 63

A decrease in supply is caused by:
A.an increase in the price of goods that are used in production.
B.suppliers' expectations of lower prices in the future.
C.an advancement in the technology for producing the good.
D.an increase in the number of producers.

Question 64

An increase in supply of a good is caused by:
A.input prices rising.
B.a fall in the price of the good.
C.an increase in the number of sellers.
D.expectations of future price increases.

Question 65

A decrease in supply is caused by:
A.a decrease in input prices.
B.an increase in the number of sellers in the market.
C.suppliers' expectations of higher prices in the future.
D.an advancement in the technology for producing the good.

Question 66

(Table: Supply of Lemonade) Look at the table Supply of Lemonade.When the price of lemonade is $1 per cup, the quantity of lemonade supplied by Eli will be:
A.40 cups.
B.90 cups.
C.10 cups.
D.25 cups.

Question 67

If the price of mozzarella cheese (an ingredient in pizza) declines, there would be:

A)a decrease in the supply of pizza.
B)an increase in the supply of pizza.
C)an increase in the quantity of pizza supplied.
D)no change in the supply of pizza.

Question 68

In the market for wheat, what would happen if the price of ethanol (which is made from corn) increases dramatically?
A.an increase in supply of wheat
B.a decrease in supply of wheat
C.an increase in demand for
D.wheat a decrease in demand for wheat

Question 69

Market equilibrium occurs when:
A.there is no incentive for prices to change in the market.
B.quantity demanded equals quantity supplied.
C.the market clears.
D.there is no incentive for prices to change in the market, quantity demanded equals quantity supplied, and the market clears.

Question 70

(Table: Supply of Lemonade) Look at the table Supply of Lemonade.If the price of lemonade is
$1 per cup, the total quantity of lemonade supplied will be:
A.50 cups.
B.80 cups.
C.25 cups.
D.90 cups.

Question 71

An increase in supply is caused by:
A.an increase in input prices.
B.a decrease in the number of sellers in the market.
C.suppliers' expectations of higher prices in the future.
D.an advancement in the technology for producing the good.

Question 72

Excess supply occurs when:
A.the price is above the equilibrium price.
B.the quantity demanded exceeds the quantity supplied.
C.the price is below the equilibrium price.
D.the quantity demanded exceeds the quantity supplied and when the price is below the equilibrium price.

Question 73

Which of the following would not cause the supply curve to shift?

A)a change in the technology of production
B)a change in factor costs
C)a change in the price of the good
D)a change in suppliers' expectations of future prices

Question 74

Which of the following is most likely to shift the supply of milk to the right?

A)a tax on each gallon of milk produced
B)an increase in household income and milk is a normal good
C)a decrease in the price of feed given to dairy cows
D)the bankruptcy of many small dairy farms

Question 75

A shift to the left of a supply curve is caused by:

A)an increase in the number of sellers.
B)a technological improvement in production.
C)an increase in the cost of an input.
D)an increase in the number of buyers.

Question 76

A technological advance in the production of automobiles will:

A)increase the demand for automobiles.
B)increase the supply of automobiles.
C)decrease the demand for automobiles.
D)decrease the supply of automobiles.

Question 77

An increase in supply is caused by:
A.an increase in input prices.
B.suppliers' expectations of higher prices in the future.
C.an increase in the price of the good.
D.a decrease in the price of goods that are used in production.

Question 78

The market equilibrium is found at the:
A.price where quantity demanded exceeds quantity supplied.
B.price where quantity demanded equals quantity supplied.
C.price where quantity supplied exceeds quantity demanded.highest price the market will bear.

Question 79

Over the past few years, the technology associated with producing flat-panel televisions has improved.This has led to ________ in flat-panel televisions.
A.an increase; the supply of
B.an increase; the demand for
C.a decrease; the supply of
D.a decrease; the quantity supplied of

Question 80

Suppose the equilibrium price of good Y is $5 and the equilibrium quantity is 150 units.If the price of good Y is $12:
A.the quantity demanded will be greater than 150 units.
B.the quantity supplied will be less than 150 units.
C.there will be an excess demand for good Y.
D.there will be an excess supply of good Y.