Question 1

Two goods are substitutes when a decrease in the price of one good

Accepted Answer

A)   decreases the demand for the other good.
B)   decreases the quantity demanded of the other good.
C)   increases the demand for the other good.
D)   increases the quantity demanded of the other good.E) A) and B)
F) A) and C)

Question 2

A rightward shift of a supply curve is called a(n)

Accepted Answer

A)   increase in supply.
B)   decrease in supply.
C)   decrease in quantity supplied.
D)   increase in quantity supplied.E) A) and B)
F) A) and C)

Question 3

If a person expects the price of pumpkins to increase next month,then that person's current demand for pumpkins will increase.

Accepted Answer

A) True 
 B)False

Question 4

If there is a shortage of farm laborers,we would expect

Accepted Answer

A)   the wage of farm laborers to increase.
B)   the wage of farm laborers to decrease.
C)   the price of farm commodities to decrease.
D)   a decrease in the demand for substitutes for farm labor.E) A) and D)
F) B) and C)

Question 5

Which of the following is not held constant in a demand schedule?

Accepted Answer

A)   income
B)   tastes
C)   price
D)   expectationsE) A) and C)
F) None of the above

Question 6

In competitive markets,

Accepted Answer

A)   firms produce identical products.
B)   buyers can influence the market price more easily than sellers.
C)   markets are more likely to be in equilibrium.
D)   sellers are price setters.E) All of the above
F) B) and C)

Question 7

If the price of steel,an input into the production of automobiles,rises,and at the same time the price of gasoline rises,what will happen to the equilibrium price and quantity of automobiles?

Accepted Answer

The equilibrium quan...

Question 8

If orange juice and apple juice are substitutes,an increase in the price of orange juice will shift the demand curve for apple juice to the left.

Accepted Answer

A) True 
 B)False

Question 9

An increase in supply is represented by a

Accepted Answer

A)   movement downward and to the left along a supply curve.
B)   movement upward and to the right along a supply curve.
C)   rightward shift of a supply curve.
D)   leftward shift of a supply curve.E) B) and C)
F) None of the above

Question 10

A leftward shift of a demand curve is called a(n)

Accepted Answer

A)   increase in demand.
B)   decrease in demand.
C)   decrease in quantity demanded.
D)   increase in quantity demanded.E) A) and B)
F) C) and D)

Question 11

In a perfectly competitive market,at the market price,buyers

Accepted Answer

A)   cannot buy all they want,and sellers cannot sell all they want.
B)   cannot buy all they want,but sellers can sell all they want.
C)   can buy all they want,but sellers cannot sell all they want.
D)   can buy all they want,and sellers can sell all they want.E) C) and D)
F) A) and B)

Question 12

Figure 4-22

-Refer to Figure 4-22.Which of the four panels represents the market for peanut butter after a major hurricane hits the peanut-growing south?

Accepted Answer

A)   Panel (a) 
B)   Panel (b) 
C)   Panel (c) 
D)   Panel (d) E) None of the above
F) A) and D)

Question 13

Soup is an inferior good if the demand

Accepted Answer

A)   for soup falls when the price of a substitute for soup rises.
B)   for soup rises when the price of soup falls.
C)   curve for soup slopes upward.
D)   for soup falls when income rises.E) A) and C)
F) None of the above

Question 14

In any economic system,scarce resources have to be allocated among competing uses.Market economies harness the forces of

Accepted Answer

A)   government to allocate scarce resources.
B)   supply and demand to allocate scarce resources.
C)   credit cards to allocate scarce resources.
D)   nature to allocate scarce resources.E) None of the above
F) A) and B)

Question 15

Which of the following would increase in response to a decrease in the price of ironing boards?

Accepted Answer

A)   the quantity of irons demanded at each possible price of irons
B)   the equilibrium quantity of irons
C)   the equilibrium price of irons
D)   All of the above are correct.E) A) and C)
F) All of the above

Question 16

Which of the following events must result in a higher price in the market for Snickers?

Accepted Answer

A)   Demand for Snickers increases,and supply of Snickers decreases.
B)   Demand for Snickers and supply of Snickers both decrease.
C)   Demand for Snickers decreases,and supply of Snickers increases.
D)   Demand for Snickers and supply of Snickers both increaseE) A) and D)
F) A) and B)

Question 17

Figure 4-6 
-Refer to Figure 4-6.The movement from D to D' could be caused by

Accepted Answer

A)   an increase in price.
B)   a decrease in the price of a complement.
C)   a technological advance.
D)   a decrease in the price of a substitute.E) A) and D)
F) A) and C)

Question 18

Suppose that a decrease in the price of good X results in fewer units of good Y being demanded.This implies that X and Y are

Accepted Answer

A)   complementary goods.
B)   normal goods.
C)   inferior goods.
D)   substitute goods.E) B) and C)
F) All of the above

Question 19

It is not possible for demand and supply to shift at the same time.

Accepted Answer

A) True 
 B)False

Question 20

Figure 4-21 
-Refer to Figure 4-21.Which of the following movements would illustrate the effect in the market for bread of an increase in the price of flour?

Accepted Answer

A)   Point A to Point B
B)   Point C to Point B
C)   Point C to Point D
D)   Point A to Point DE) None of the above
F) All of the above

Exam 4: The Market Forces of Supply and Demand

If a person expects the price of pumpkins to increase next month,then that person's current demand for pumpkins will increase.

Correct AnswerverifiedShow Answer

In competitive markets,

Correct AnswerverifiedShow Answer

Which of the following is not held constant in a demand schedule?

Correct AnswerverifiedShow Answer

In any economic system,scarce resources have to be allocated among competing uses.Market economies harness the forces of

Correct AnswerverifiedShow Answer

Figure 4-21 -Refer to Figure 4-21.Which of the following movements would illustrate the effect in the market for bread of an increase in the price of flour?

Correct AnswerverifiedShow Answer

If orange juice and apple juice are substitutes,an increase in the price of orange juice will shift the demand curve for apple juice to the left.

Correct AnswerverifiedShow Answer

Which of the following events must result in a higher price in the market for Snickers?

Correct AnswerverifiedShow Answer

Suppose that a decrease in the price of good X results in fewer units of good Y being demanded.This implies that X and Y are

Correct AnswerverifiedShow Answer

A leftward shift of a demand curve is called a(n)

Correct AnswerverifiedShow Answer

If the price of steel,an input into the production of automobiles,rises,and at the same time the price of gasoline rises,what will happen to the equilibrium price and quantity of automobiles?

Correct AnswerverifiedThe equilibrium quan...View AnswerShow Answer

It is not possible for demand and supply to shift at the same time.

Correct AnswerverifiedShow Answer

Figure 4-22 -Refer to Figure 4-22.Which of the four panels represents the market for peanut butter after a major hurricane hits the peanut-growing south?

Correct AnswerverifiedShow Answer

An increase in supply is represented by a

Correct AnswerverifiedShow Answer

Two goods are substitutes when a decrease in the price of one good

Correct AnswerverifiedShow Answer

Soup is an inferior good if the demand

Correct AnswerverifiedShow Answer

Which of the following would increase in response to a decrease in the price of ironing boards?

Correct AnswerverifiedShow Answer

In a perfectly competitive market,at the market price,buyers

Correct AnswerverifiedShow Answer

A rightward shift of a supply curve is called a(n)

Correct AnswerverifiedShow Answer

If there is a shortage of farm laborers,we would expect

Correct AnswerverifiedShow Answer

Figure 4-6 -Refer to Figure 4-6.The movement from D to D' could be caused by

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The equilibrium quan...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified