Deck 4: Supply and Demand: An Initial Look

Question 1

Changes in consumer preference toward small,imported automobiles have shifted their demand curves downward and to the left.

Answer 1

False

Question 2

An increase in price will decrease demand.

Answer 2

False

Question 3

Very few societies have used price controls.

Answer 3

False

Question 4

Change in the price of a good causes the demand schedule for that good to shift.

Question 5

Demand and quantity demanded are the same thing.

Question 6

A decrease in the price of VCRs will increase demand for video cassettes.

Question 7

A change in the income of buyers will normally change demand.

Question 8

A cold winter will increase the quantity of heating fuel demanded at every price.

Question 9

Governments of market-oriented economies never tamper with the price mechanism.

Question 10

A demand schedule's position is determined partly by the supply of a good.

Question 11

A change in the price of hamburgers will change the supply of hot dogs.

Question 12

A demand schedule shows the time over which different quantities will be demanded.

Question 13

A shift of the demand curve for a good occurs whenever new technologies make inputs used in producing that good available at lower prices.

Question 14

The laws of supply and demand did not apply to Asian currencies.

Question 15

A demand schedule relates prices of a particular good to quantities demanded.

Question 16

Scarcity and choice are the basic problems of economics; the supply and demand mechanism is the basic investigative tool of economics.

Question 17

George Washington's troops at Valley Forge were almost destroyed by price controls.

Question 18

If the demand curve shifts outward and the supply curve remains the same,price will fall.

Question 19

"Demand" is a series of quantities demanded,one for each person in the market.

Question 20

A demand curve shows the relationship between price and quantity demanded only so long as all other things are held constant.

Question 21

Changes in the size of an industry may cause supply to shift.

Question 22

Demand curves can be affected by the prices of related goods.

Question 23

Both demand and supply curves usually have positive slopes.

Question 24

A supply curve slopes upward because quantity supplied is higher when price is higher.

Question 25

Demand shifts due to changes in price.

Question 26

The more firms that are attracted to an industry,the greater will be the quantity of product supplied at any given price.

Question 27

A supply schedule can be plotted on a graph to yield a supply curve.

Question 28

Supply can shift due to changes in price.

Question 29

A change in the price of a good has no effect on the supply schedule.

Question 30

As price increases,additional suppliers are willing to produce a commodity.

Question 31

A change in the price of important inputs will change the quantity supplied but will not shift the supply curve.

Question 32

Cost-reducing technological advancements allow suppliers to earn more profits but have no noticeable effect on the supply curve.

Question 33

If the price of hamburger rises,we would expect the demand for steak to shift to the right.

Question 34

Consumer income changes can shift market demand.

Question 35

When people suddenly want to buy something,supply increases.

Question 36

An increase in consumer income will shift both the supply and demand curves.

Question 37

The position of a demand curve is unaffected by changes in the price of the good.

Question 38

An increase in price will increase supply.

Question 39

Advertising has no effect on the demand schedule for a good.

Question 40

As more firms are attracted to an industry,the supply curve can be expected to shift to the right.

Question 41

When price is above the equilibrium level,competitive price cutting will continue as long as quantity supplied exceeds quantity demanded.

Question 42

"Equilibrium" is a situation in which there are no inherent forces to produce change.

Question 43

Any factor that shifts the demand curve to the left but does not affect the supply curve will lower the equilibrium price and raise the equilibrium quantity.

Question 44

A shortage occurs when price is higher than the market equilibrium.

Question 45

At equilibrium,the market will clear,with no surpluses or shortages occurring.

Question 46

Drawing the supply curve and the demand curve on the same graph helps show how price is determined.

Question 47

A surplus occurs when price is higher than the market equilibrium.

Question 48

Equilibrium is reached where there is no inherent force causing quantity supplied or quantity demanded to change.

Question 49

If demand increases,the equilibrium price and equilibrium quantity will both fall,everything else being equal.

Question 50

The laws of supply and demand force prices to an equilibrium.

Question 51

When price is above the equilibrium level,suppliers offer more than demanders wish to buy.

Question 52

If supply increases,the equilibrium price will rise and the equilibrium quantity will fall.

Question 53

When price is below the equilibrium level,there is a shortage of the commodity being sold.

Question 54

Technological advances that allow a good to be produced at a lower cost will shift the demand curve rightward.

Question 55

Technological advances shift the supply curve rightward.

Question 56

A price above equilibrium always yields a surplus.

Question 57

Any factor that shifts the supply curve inward and to the left and does not affect the demand curve will raise the equilibrium price and reduce the equilibrium quantity.

Question 58

Even though prices may change frequently,they can be expected to gravitate toward equilibrium.

Question 59

Equilibrium price and quantity are determined by the intersection of the demand and supply curves.

Question 60

At equilibrium,quantity demanded equals quantity supplied.

Question 61

Price ceilings lead to market surpluses.

Question 62

Regulations are sometimes used to "correct" the failures of a market mechanism.

Question 63

A black market develops only when quantity demanded exceeds quantity supplied.

Question 64

A price ceiling is only effective if it is above the market equilibrium.

Question 65

Rent controls are designed to protect consumers from high rents.

Question 66

Price floors set a legal minimum price on a product or commodity.

Question 67

Sugar price supports primarily benefit consumers.

Question 68

If the government puts price controls on medical care,this will increase the supply of affordable care in the United States.

Question 69

Rent controls are most often designed to protect the investment made by apartment building owners.

Question 70

Price ceilings are designed to protect sellers,while price floors are designed to protect buyers.

Question 71

Price floors lead to market surpluses.

Question 72

Price ceilings set a legal maximum price on a product or commodity.

Question 73

Enacting a law controlling rents near a major university will increase the affordable housing for college students.

Question 74

Rent controls encourage investment in housing because they bring stability to the market.

Question 75

A minimum wage law may cause unemployment among low-skill workers.

Question 76

Price supports increase the supply of affordable milk for U.S.families.

Question 77

Price floors are only effective below the market equilibrium.

Question 78

Black-market prices are below equilibrium prices because sellers want to sell large quantities.

Question 79

Since rent controls have been in effect in New York City,apartments have been more plentiful.

Question 80

Rent controls and controls on other prices often aggravate the very problem they are intended to solve.