Question 1

Market equilibrium
I.can never occur because there are always people who want a good but cannot afford it.
Ii.occurs at the intersection of the supply and demand curves.
Iii.is the point where the price equals the quantity.

Accepted Answer

A)  ii only
B)  iii only
C)  ii and iii
D)  i only
E)  i and ii

Question 2

-A construction boom occurs and many of the new buildings need plywood for their framing.Which of the figures above best illustrates this change?

Accepted Answer

A)  Figure A
B)  Figure B
C)  Figure C
D)  Figure D
E)  Figure A or Figure C

Question 3

-The above figure shows the market for laptops.Which of the following shifts the supply curve from S0 to S1?

Accepted Answer

A)  an increase in the cost of hard drives
B)  a decrease in the price of laptops
C)  an increase in the number of laptop manufactures and sellers
D)  an increase in the price of laptops
E)  an increase in the productivity of the workers manufacturing laptops

Question 4

During 2008 the supply of gasoline decreased while at the same time the demand for gasoline increased.If the magnitude of the increase in demand was greater than the magnitude of the decrease in supply,then the equilibrium price of gasoline ________ and the equilibrium quantity ________.

Accepted Answer

A)  increased;increased
B)  increased;decreased
C)  increased;did not change
D)  decreased;did not change
E)  did not change;increased

Question 5

Suppose the equilibrium price of oranges is $2.00 per pound.If the actual price is above the equilibrium price,a

Accepted Answer

A)  shortage exists and the price falls to restore equilibrium.
B)  shortage exists and the price rises to restore equilibrium.
C)  surplus exists and the price falls to restore equilibrium.
D)  surplus exists and the price rises to restore equilibrium.
E)  surplus exists but nothing happens until either the demand or the supply changes.

Question 6

Assume a market is in equilibrium.There is an increase in supply,but no change in demand As a result the equilibrium price ________,and the equilibrium quantity ________.

Accepted Answer

A)  rises;increases
B)  rises;decreases
C)  rises;does not change
D)  falls;decreases
E)  falls;increases

Question 7

Explain the difference between a change in demand and a change in quantity demanded.What leads to each of these changes?

Accepted Answer

A change in demand occurs when consumers...

Question 8

When moving along a demand curve,which of the following changes?

Accepted Answer

A)  the consumers' incomes
B)  the prices of other goods
C)  the number of buyers
D)  the price of the good
E)  the consumers' preferences

Question 9

-The above figures show the market for HD televisions.If the price of the LCD screens used to produce these televisions falls,which figure shows the effect of this change in price?

Accepted Answer

A)  Figure A
B)  Figure B
C)  Figure C
D)  Figure D
E)  None of the figures represent this change.

Question 10

To be part of the supply for a good,a producer must be

Accepted Answer

A)  only able to supply the good.
B)  only willing to supply the good.
C)  both able and willing to supply the good.
D)  both able and willing to supply the good,and have already identified a buyer.
E)  both able and willing to supply the good,and have already sold the good.

Question 11

The price of cotton clothing falls.As a result,

Accepted Answer

A)  the quantity demanded of cotton clothing increases.
B)  the demand for cotton clothing increases.
C)  the quantity demanded of cotton clothing decreases.
D)  the demand for cotton clothing decreases.
E)  both the demand for cotton clothing increases and the quantity demanded of cotton clothing increases.

Question 12

What happens to the demand for a good if a complement's price increases?

Accepted Answer

A)  The demand decreases and the demand curve shifts rightward.
B)  The demand increases and the demand curve shifts rightward.
C)  The demand decreases and the demand curve shifts leftward.
D)  The demand increases and the demand curve shifts leftward.
E)  There is no impact on demand for the good and the demand curve does not shift.

Question 13

The law of demand implies that,other things remaining the same,

Accepted Answer

A)  as the price of a cheeseburger rises,the quantity of cheeseburgers demanded increases.
B)  as the price of a cheeseburger rises,the quantity of cheeseburgers demanded decreases.
C)  as income increases,the quantity of cheeseburgers demanded increases.
D)  as the demand for cheeseburgers increases,the price of a cheeseburger falls.
E)  as more people demand cheeseburgers,the quantity demanded increases.

Question 14

If the demand and supply both increase equally,then the equilibrium price ________ and the equilibrium quantity ________.

Accepted Answer

A)  increases;increases
B)  increases;does not change
C)  does not change;increases
D)  increases;decreases
E)  decreases;does not change

Question 15

The supply schedule

Accepted Answer

A)  shows the relationship between the quantity supplied and the price of a good when all other influences on selling plans remain the same.
B)  is a curve showing the relationship between the amount the sellers are willing and able to sell and the price of that good when all relevant factors change.
C)  shows one quantity at one price.
D)  is the schedule that suppliers have to keep or else they will be late.
E)  shows the relationship between the quantity supplied and the price of a good when all other influences on selling plans change.

Question 16

-The graph illustrates the market for computers.If the number of buyers of computers increases and technology advances,you predict that the

Accepted Answer

A)  equilibrium quantity of computers will increase.
B)  equilibrium quantity of computers will decrease.
C)  equilibrium price of a computer will rise.
D)  equilibrium price of a computer will fall.
E)  equilibrium quantity of computers might increase,decrease,or not change.

Question 17

You are just about to finish college and are about to start a high paying job.Because of this new job,what is the most likely outcome in the market for cars?

Accepted Answer

A)  Your demand for cars will decrease.
B)  The market supply of cars will increase.
C)  Your demand for cars will increase.
D)  The market supply of cars will decrease.
E)  The demand and the supply for cars will decrease.

Question 18

Pizza and tacos are substitutes,and the price of a pizza increases.Which of the following correctly indicates what happens?

Accepted Answer

A)  The demand for pizzas decreases and the demand for tacos increases.
B)  The demand for both goods decreases.
C)  The quantity of tacos demanded increases and the quantity of pizza demanded decreases.
D)  The quantity of pizza demanded decreases and the demand for tacos increases.
E)  The demand for each decreases because both are normal goods.

Question 19

In a recession,consumers have less income to spend.As a result,if dining out is a normal good,then which of the following would happen to the demand curve for dining out?

Accepted Answer

A)  The demand curve would shift leftward.
B)  The demand curve would not shift but the price of dining out would rise.
C)  The effect on the demand curve is unknown.
D)  The demand curve would shift rightward.
E)  The demand curve would not shift but the price of dining out would fall.

Question 20

Suppose that the price of flour used to produce bagels increases.Hence the equilibrium price of a bagel ________,and the equilibrium quantity ________.

Accepted Answer

A)  rises;increases
B)  rises;decreases
C)  falls;increases
D)  falls;decreases
E)  does not change;does not change

Exam 4: Demand and Supply

Suppose that the price of flour used to produce bagels increases.Hence the equilibrium price of a bagel ________,and the equilibrium quantity ________.

Correct AnswerverifiedShow Answer

The supply schedule

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If the demand and supply both increase equally,then the equilibrium price ________ and the equilibrium quantity ________.

Correct AnswerverifiedShow Answer

Explain the difference between a change in demand and a change in quantity demanded.What leads to each of these changes?

Correct AnswerverifiedA change in demand occurs when consumers...View AnswerShow Answer

-The graph illustrates the market for computers.If the number of buyers of computers increases and technology advances,you predict that the

Correct AnswerverifiedShow Answer

-The above figure shows the market for laptops.Which of the following shifts the supply curve from S0 to S1?

Correct AnswerverifiedShow Answer

When moving along a demand curve,which of the following changes?

Correct AnswerverifiedShow Answer

Suppose the equilibrium price of oranges is $2.00 per pound.If the actual price is above the equilibrium price,a

Correct AnswerverifiedShow Answer

What happens to the demand for a good if a complement's price increases?

Correct AnswerverifiedShow Answer

The price of cotton clothing falls.As a result,

Correct AnswerverifiedShow Answer

Assume a market is in equilibrium.There is an increase in supply,but no change in demand As a result the equilibrium price ________,and the equilibrium quantity ________.

Correct AnswerverifiedShow Answer

Pizza and tacos are substitutes,and the price of a pizza increases.Which of the following correctly indicates what happens?

Correct AnswerverifiedShow Answer

In a recession,consumers have less income to spend.As a result,if dining out is a normal good,then which of the following would happen to the demand curve for dining out?

Correct AnswerverifiedShow Answer

To be part of the supply for a good,a producer must be

Correct AnswerverifiedShow Answer

-A construction boom occurs and many of the new buildings need plywood for their framing.Which of the figures above best illustrates this change?

Correct AnswerverifiedShow Answer

During 2008 the supply of gasoline decreased while at the same time the demand for gasoline increased.If the magnitude of the increase in demand was greater than the magnitude of the decrease in supply,then the equilibrium price of gasoline ________ and the equilibrium quantity ________.

Correct AnswerverifiedShow Answer

You are just about to finish college and are about to start a high paying job.Because of this new job,what is the most likely outcome in the market for cars?

Correct AnswerverifiedShow Answer

The law of demand implies that,other things remaining the same,

Correct AnswerverifiedShow Answer

Market equilibrium I.can never occur because there are always people who want a good but cannot afford it. Ii.occurs at the intersection of the supply and demand curves. Iii.is the point where the price equals the quantity.

Correct AnswerverifiedShow Answer

-The above figures show the market for HD televisions.If the price of the LCD screens used to produce these televisions falls,which figure shows the effect of this change in price?

Correct AnswerverifiedShow Answer

Suppose that the price of flour used to produce bagels increases.Hence the equilibrium price of a bagel ,and the equilibrium quantity .

Correct Answer
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Correct Answer
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If the demand and supply both increase equally,then the equilibrium price and the equilibrium quantity .

Correct Answer
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Correct Answer
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A change in demand occurs when consumers...
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Assume a market is in equilibrium.There is an increase in supply,but no change in demand As a result the equilibrium price ,and the equilibrium quantity .

Correct Answer
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Correct Answer
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During 2008 the supply of gasoline decreased while at the same time the demand for gasoline increased.If the magnitude of the increase in demand was greater than the magnitude of the decrease in supply,then the equilibrium price of gasoline and the equilibrium quantity .

Correct Answer
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Correct Answer
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