Question 1

A CPA recently has come to expect higher prices for expert tax advice in the near future. We would expect

Accepted Answer

A)  the CPA to supply more expert tax advice now than she was supplying previously.
B)  the CPA to supply less expert tax advice now than she was supplying previously.
C)  the demand for this CPA's expert tax advice to fall.
D)  no change in the CPA's current supply; instead, future supply will be affected.

Question 2

Table 4-8 
-Refer to Table 4-8. Suppose Firm X and Firm Y are the only two sellers in the market. If the market price decreases from $12 to $9, quantity supplied will

Accepted Answer

A)  decrease by 6 units.
B)  decrease by 12 units.
C)  increase by 6 units.
D)  increase by 12 units.

Question 3

You wear either shorts or sweatpants every day. You notice that sweatpants have gone on sale, so your demand for

Accepted Answer

A)  sweatpants will increase.
B)  sweatpants will decrease.
C)  shorts will increase.
D)  shorts will decrease.

Question 4

Warrensburg is a small college town in Missouri. At the end of August each year, the market demand for fast food in Warrensburg

Accepted Answer

A)  increases.
B)  decreases.
C)  remains constant, but we observe a movement downward and to the right along the demand curve.
D)  remains constant, but we observe a movement upward and to the left along the demand curve.

Question 5

Which of the following is not a characteristic of a perfectly competitive market?

Accepted Answer

A)  Different sellers sell identical products.
B)  There are many sellers.
C)  Sellers must accept the price the market determines.
D)  All of the above are characteristics of a perfectly competitive market.

Question 6

A decrease in the price of blueberries will decrease both the equilibrium price and quantity in the market for blueberry muffins.

Accepted Answer

A) True 
 B)False

Question 7

When we move along a given supply curve,

Accepted Answer

A)  only price is held constant.
B)  technology and price are held constant.
C)  all nonprice determinants of supply are held constant.
D)  all determinants of quantity supplied are held constant.

Question 8

Suppose the American Medical Association announces that men who shave their heads are less likely to die of heart failure. We could expect the current demand for

Accepted Answer

A)  hair gel to increase.
B)  razors to increase.
C)  combs to increase.
D)  shampoo to increase.

Question 9

Which of these statements best represents the law of supply?

Accepted Answer

A)  When input prices increase, sellers produce less of the good.
B)  When production technology improves, sellers produce less of the good.
C)  When the price of a good decreases, sellers produce less of the good.
D)  When sellers' supplies of a good increase, the price of the good increases.

Question 10

A market is a group of buyers and sellers of a particular good or service.

Accepted Answer

A) True 
 B)False

Question 11

The law of demand states that, other things equal, when the price of a good rises, the quantity demanded of the good rises, and when the price falls, the quantity demanded falls.

Accepted Answer

A) True 
 B)False

Question 12

A decrease in supply shifts the supply curve to the left.

Accepted Answer

A) True 
 B)False

Question 13

A decrease in demand shifts the demand curve to the left.

Accepted Answer

A) True 
 B)False

Question 14

In a given market, how are the equilibrium price and the market-clearing price related?

Accepted Answer

A)  There is no relationship.
B)  They are the same price.
C)  The market-clearing price exceeds the equilibrium price.
D)  The equilibrium price exceeds the market-clearing price.

Question 15

Figure 4-24
The diagram below pertains to the demand for turkey in the United States. A to DB. B) DB to DA. C) x to y. D) y to x." class="answers-bank-image d-inline" rel="preload" >
-Refer to Figure 4-24. All else equal, sellers expecting the price of turkey to rise in the future would cause a current move from

Accepted Answer

A)  DA to DB.
B)  DB to DA.
C)  x to y.
D)  y to x.

Question 16

Which of the following events would cause a movement downward and to the left along the supply curve for mangos?

Accepted Answer

A)  The number of sellers of mangos decreases.
B)  There is an advance in technology that reduces the cost of producing mangos.
C)  The price of mangos falls.
D)  The price of fertilizer increases, and fertilizer is an input in the production of mangos.

Question 17

Sellers respond to a surplus by cutting their prices.

Accepted Answer

A) True 
 B)False

Question 18

If the demand for a good increases at the same time as the supply of the same good decreases, what will happen to the equilibrium price and quantity of the good?

Accepted Answer

a. <img  loading="lazy" src="/assets/images/blured-textbook.svg" class="d-inline m-1" alt="blured image" width="139" height="30"> b.The equilibrium price (Pe) is $4 a...

Question 19

If the demand for a product decreases, then we would expect equilibrium price

Accepted Answer

A)  to increase and equilibrium quantity to decrease.
B)  to decrease and equilibrium quantity to increase.
C)  and equilibrium quantity to both increase.
D)  and equilibrium quantity to both decrease.

Question 20

An increase in the price of maple syrup will decrease both the equilibrium price and quantity in the market for pancakes.

Accepted Answer

A) True 
 B)False

Exam 4: The Market Forces of Supply and Demand

A decrease in the price of blueberries will decrease both the equilibrium price and quantity in the market for blueberry muffins.

Correct AnswerverifiedShow Answer

Which of these statements best represents the law of supply?

Correct AnswerverifiedShow Answer

If the demand for a good increases at the same time as the supply of the same good decreases, what will happen to the equilibrium price and quantity of the good?

Correct Answerverifieda. b.The equilibrium price (Pe) is $4 a...View AnswerShow Answer

The law of demand states that, other things equal, when the price of a good rises, the quantity demanded of the good rises, and when the price falls, the quantity demanded falls.

Correct AnswerverifiedShow Answer

If the demand for a product decreases, then we would expect equilibrium price

Correct AnswerverifiedShow Answer

A CPA recently has come to expect higher prices for expert tax advice in the near future. We would expect

Correct AnswerverifiedShow Answer

Table 4-8 -Refer to Table 4-8. Suppose Firm X and Firm Y are the only two sellers in the market. If the market price decreases from $12 to $9, quantity supplied will

Correct AnswerverifiedShow Answer

Figure 4-24 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-24. All else equal, sellers expecting the price of turkey to rise in the future would cause a current move from

Correct AnswerverifiedShow Answer

Warrensburg is a small college town in Missouri. At the end of August each year, the market demand for fast food in Warrensburg

Correct AnswerverifiedShow Answer

A decrease in supply shifts the supply curve to the left.

Correct AnswerverifiedShow Answer

A decrease in demand shifts the demand curve to the left.

Correct AnswerverifiedShow Answer

Sellers respond to a surplus by cutting their prices.

Correct AnswerverifiedShow Answer

Which of the following events would cause a movement downward and to the left along the supply curve for mangos?

Correct AnswerverifiedShow Answer

Which of the following is not a characteristic of a perfectly competitive market?

Correct AnswerverifiedShow Answer

You wear either shorts or sweatpants every day. You notice that sweatpants have gone on sale, so your demand for

Correct AnswerverifiedShow Answer

An increase in the price of maple syrup will decrease both the equilibrium price and quantity in the market for pancakes.

Correct AnswerverifiedShow Answer

When we move along a given supply curve,

Correct AnswerverifiedShow Answer

In a given market, how are the equilibrium price and the market-clearing price related?

Correct AnswerverifiedShow Answer

Suppose the American Medical Association announces that men who shave their heads are less likely to die of heart failure. We could expect the current demand for

Correct AnswerverifiedShow Answer

A market is a group of buyers and sellers of a particular good or service.

Correct AnswerverifiedShow Answer

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a. b.The equilibrium price (Pe) is $4 a...
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