Question 1

Figure 4-8 
-Refer to Figure 4-8.The movement from Point A to Point B represents a(n)

Accepted Answer

A)   shift in the supply curve.
B)   decrease in the quantity supplied.
C)   increase in the quantity supplied.
D)   Both a) and b) are correct.

Question 2

Which of the following might cause the demand curve for an inferior good to shift to the left?

Accepted Answer

A)   a decrease in income
B)   an increase in the price of a substitute
C)   an increase in the price of a complement
D)   None of the above is correct.

Question 3

Once the supply curve for a product or service is drawn,it

Accepted Answer

A)   remains stable over time.
B)   can shift either rightward or leftward.
C)   is possible to move along the curve,but the curve will not shift.
D)   tends to become steeper over time.

Question 4

"Other things equal,when the price of a good rises,the quantity demanded of the good falls,and when the price falls,the quantity demanded rises." This relationship between price and quantity demanded

Accepted Answer

A)   applies to most goods in the economy.
B)   is represented by a downward-sloping demand curve.
C)   is referred to as the law of demand.
D)   All of the above are correct.

Question 5

An increase in the price of pizza will shift the demand curve for pizza to the left.

Accepted Answer

A) True 
 B)False

Question 6

What would happen to the equilibrium price and quantity of lattés if coffee shops began using a machine that reduced the amount of labor necessary to produce steamed milk,which is used to make lattés,and scientists discovered that lattés cause heart attacks?

Accepted Answer

A)   Both the equilibrium price and quantity would increase.
B)   Both the equilibrium price and quantity would decrease.
C)   The equilibrium price would decrease,and the effect on equilibrium quantity would be ambiguous.
D)   The equilibrium quantity would decrease,and the effect on equilibrium price would be ambiguous.

Question 7

Figure 4-9 
-Refer to Figure 4-9.The movement from point A to point B on the graph is called

Accepted Answer

A)   a decrease in supply.
B)   an increase in supply.
C)   an increase in the quantity supplied.
D)   a decrease in the quantity supplied.

Question 8

Suppose the incomes of buyers in a market for a particular normal good decrease and there is also a reduction in input prices.What would we expect to occur in this market?

Accepted Answer

A)   Equilibrium price would decrease,but the impact on equilibrium quantity would be ambiguous.
B)   Equilibrium price would increase,but the impact on equilibrium quantity would be ambiguous.
C)   Equilibrium quantity would decrease,but the impact on equilibrium price would be ambiguous.
D)   Equilibrium quantity would increase,but the impact on equilibrium price would be ambiguous.

Question 9

If the supply of 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 10

Local cable television companies frequently are monopolists.

Accepted Answer

A) True 
 B)False

Question 11

If something happens to alter the quantity supplied at any given price,then we move along the fixed supply curve to a new quantity supplied.

Accepted Answer

A) True 
 B)False

Question 12

Adam Smith suggested that an invisible had guides market economies.In this analogy,what is the baton that the invisible hand uses to conduct the economic orchestra?

Accepted Answer

A)   the government
B)   prices
C)   subsidies
D)   the Federal Reserve

Question 13

If a decrease in income increases the demand for a good,then the good is a(n)

Accepted Answer

A)   substitute good.
B)   complementary good.
C)   normal good.
D)   inferior good.

Question 14

Figure 4-14 
-Refer to Figure 4-14.At a price of

Accepted Answer

A)   $8,there is a surplus of 6 units.
B)   $5,there is neither a shortage nor a surplus.
C)   $2,there is a shortage of 6 units.
D)   All of the above are correct.

Question 15

Figure 4-19
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 4-19.All else equal,an increase in the income of buyers who consider turkey to be an inferior good would cause a move from

Accepted Answer

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

Question 16

Table 4-7
 
-Refer to Table 4-7.If the price were $4,a

Accepted Answer

A)   surplus of 15 units would exist,and price would tend to fall.
B)   shortage of 25 units would exist,and price would tend to rise.
C)   surplus of 25 units would exist,and price would tend to fall.
D)   shortage of 40 units would exist,and price would tend to rise.

Question 17

If the demand for a good falls when income falls,then the good is called a(n)

Accepted Answer

A)   normal good.
B)   regular good.
C)   luxury good.
D)   inferior good.

Question 18

An increase in which of the following would shift the supply curve for gasoline to the right?

Accepted Answer

A)   demand for gasoline
B)   price of gasoline
C)   number of producers of gasoline
D)   price of oil,an input into the production of gasoline

Question 19

Table 4-6
 
-Refer to Table 4-6.Which combination would produce a decrease in equilibrium price and an indeterminate change in equilibrium quantity?

Accepted Answer

A)   A
B)   B
C)   C
D)   D

Question 20

If a shortage exists in a market,then we know that the actual price is

Accepted Answer

A)   above the equilibrium price,and quantity supplied is greater than quantity demanded.
B)   above the equilibrium price,and quantity demanded is greater than quantity supplied.
C)   below the equilibrium price,and quantity demanded is greater than quantity supplied.
D)   below the equilibrium price,and quantity supplied is greater than quantity demanded.

Exam 4: The Market Forces of Supply and Demand

If something happens to alter the quantity supplied at any given price,then we move along the fixed supply curve to a new quantity supplied.

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Figure 4-14 -Refer to Figure 4-14.At a price of

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If the demand for a good falls when income falls,then the good is called a(n)

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If the supply of a product decreases,then we would expect equilibrium price

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Adam Smith suggested that an invisible had guides market economies.In this analogy,what is the baton that the invisible hand uses to conduct the economic orchestra?

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If a decrease in income increases the demand for a good,then the good is a(n)

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Table 4-6 -Refer to Table 4-6.Which combination would produce a decrease in equilibrium price and an indeterminate change in equilibrium quantity?

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If a shortage exists in a market,then we know that the actual price is

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Suppose the incomes of buyers in a market for a particular normal good decrease and there is also a reduction in input prices.What would we expect to occur in this market?

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Local cable television companies frequently are monopolists.

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Figure 4-19 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-19.All else equal,an increase in the income of buyers who consider turkey to be an inferior good would cause a move from

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Which of the following might cause the demand curve for an inferior good to shift to the left?

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Once the supply curve for a product or service is drawn,it

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An increase in which of the following would shift the supply curve for gasoline to the right?

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Table 4-7 -Refer to Table 4-7.If the price were $4,a

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Figure 4-9 -Refer to Figure 4-9.The movement from point A to point B on the graph is called

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An increase in the price of pizza will shift the demand curve for pizza to the left.

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"Other things equal,when the price of a good rises,the quantity demanded of the good falls,and when the price falls,the quantity demanded rises." This relationship between price and quantity demanded

Correct AnswerverifiedShow Answer

What would happen to the equilibrium price and quantity of lattés if coffee shops began using a machine that reduced the amount of labor necessary to produce steamed milk,which is used to make lattés,and scientists discovered that lattés cause heart attacks?

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Figure 4-8 -Refer to Figure 4-8.The movement from Point A to Point B represents a(n)

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