Question 1

Figure 4-4 
-Refer to Figure 4-4. Which of the following would cause the demand curve to shift from Demand B to Demand C in the market for DVDs in the United States?

Accepted Answer

A)  a decrease in the price of DVDs
B)  a decrease in the price of DVD players
C)  a change in consumer preferences toward watching movies in movie theaters rather than at home
D)  a decrease in the number of people in the United StatesE) A) and B)
F) A) and C)

Question 2

For a market for a good or service to exist, there must be a

Accepted Answer

A)  group of buyers and sellers.
B)  specific time and place at which the good or service is traded.
C)  high degree of organization present.
D)  All of the above are correct.E) A) and D)
F) A) and C)

Question 3

Figure 4-15 
-Refer to Figure 4-15. At what price would there be an excess demand of 200 units of the good?

Accepted Answer

A)  $15
B)  $20
C)  $30
D)  $35E) A) and B)
F) A) and C)

Question 4

If a study by medical researchers finds that eating brown rice causes weight loss while eating white rice causes weight gain, then we likely would see

Accepted Answer

A)  an increase in demand for brown rice and a decrease in demand for white rice.
B)  a decrease in demand for brown rice and an increase in demand for white rice.
C)  an increase in demand for both brown and white rice.
D)  no change in demand for either type of rice because weight loss is not a determinant of demand.E) B) and C)
F) A) and D)

Question 5

When the market price is above the equilibrium price, suppliers are unable to sell all they want to sell.

Accepted Answer

A) True 
 B)False

Question 6

When a shortage exists in a market, sellers

Accepted Answer

A)  raise price, which increases quantity demanded and decreases quantity supplied until the shortage is eliminated.
B)  raise price, which decreases quantity demanded and increases quantity supplied until the shortage is eliminated.
C)  lower price, which increases quantity demanded and decreases quantity supplied until the shortage is eliminated.
D)  lower price, which decreases quantity demanded and increases quantity supplied until the shortage is eliminated.E) All of the above
F) C) and D)

Question 7

If something happens to alter the quantity demanded at any given price, then

Accepted Answer

A)  the demand curve becomes steeper.
B)  the demand curve becomes flatter.
C)  the demand curve shifts.
D)  we move along the demand curve.E) A) and C)
F) All of the above

Question 8

In a competitive market, the quantity of a product produced and the price of the product are determined by

Accepted Answer

A)  a single buyer.
B)  a single seller.
C)  one buyer and one seller working together.
D)  all buyers and all sellers.E) B) and C)
F) A) and C)

Question 9

Supply refers to the position of the supply curve, whereas the quantity supplied refers to the amount suppliers wish to sell.

Accepted Answer

A) True 
 B)False

Question 10

A decrease in the price of a complement will shift the demand curve for a good to the left.

Accepted Answer

A) True 
 B)False

Question 11

The line that relates the price of a good and the quantity supplied of that good is called the supply

Accepted Answer

A)  schedule, and it usually slopes upward.
B)  schedule, and it usually slopes downward.
C)  curve, and it usually slopes upward.
D)  curve, and it usually slopes downward.E) A) and D)
F) None of the above

Question 12

What would happen to the equilibrium price and quantity of peanut butter if the price of peanuts went up, the price of jelly fell, fewer firms decided to produce peanut butter, and health officials announced that eating peanut butter was good for you?

Accepted Answer

A)  Price will fall, and the effect on quantity is ambiguous.
B)  Price will rise, and the effect on quantity is ambiguous.
C)  Quantity will fall, and the effect on price is ambiguous.
D)  Quantity will rise, and the effect on price is ambiguous.E) A) and D)
F) C) and D)

Question 13

Assume the market for tennis balls is perfectly competitive. When one tennis ball producer exits the market,

Accepted Answer

A)  the price of tennis balls increases.
B)  the price of tennis balls decreases.
C)  the price of tennis balls does not change.
D)  there is no longer a market for tennis balls.E) A) and D)
F) C) and D)

Question 14

Table 4-8
A country club usually only allows members to purchase tickets for its celebrity golf tournament, but the club is considering allowing non-members to purchase tickets this year. The demand and supply schedules are as follows:
   Price  Quantity Denanded  by Members  Quantity Demanded  by Nan-members  Quantity Supplied $101000500600$15800400600$20600300600$25400200600$30200100600\begin{array} { | c | c | c | c } \hline 	ext { Price } & \begin{array} { c } 	ext { Quantity Denanded } \	ext { by Members }\end{array} & \begin{array} { c } 	ext { Quantity Demanded } \	ext { by Nan-members }\end{array} & 	ext { Quantity Supplied } \\hline \$ 10 & 1000 & 500 & 600 \\hline \$ 15 & 800 & 400 & 600 \\hline \$ 20 & 600 & 300 & 600 \\hline \$ 25 & 400 & 200 & 600 \\hline \$ 30 & 200 & 100 & 600 \\hline\end{array} Price $10$15$20$25$30​ Quantity Denanded  by Members ​1000800600400200​ Quantity Demanded  by Nan-members ​500400300200100​ Quantity Supplied 600600600600600​​ 
-Refer to Table 4-8. If only members are allowed to purchase tickets to this year's celebrity golf tournament, then what will be the equilibrium price?

Accepted Answer

A)  $10
B)  $15
C)  $20
D)  $25 E) B) and D)
F) A) and D)

Question 15

If a higher price means a greater quantity supplied, then the supply curve slopes upward.

Accepted Answer

A) True 
 B)False

Question 16

The line that relates the price of a good and the quantity demanded of that good is called the demand

Accepted Answer

A)  schedule, and it usually slopes upward.
B)  schedule, and it usually slopes downward.
C)  curve, and it usually slopes upward.
D)  curve, and it usually slopes downward.E) None of the above
F) A) and D)

Question 17

Public service announcements, mandatory health warnings on cigarette packages, and the prohibition of cigarette advertising on television are all policies aimed at shifting the demand curve for cigarettes to the right.

Accepted Answer

A) True 
 B)False

Question 18

The law of demand states that, 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.

Accepted Answer

A) True 
 B)False

Question 19

Years ago, thousands of country music fans risked their lives by rushing to buy tickets for a Willie Nelson concert at Carnegie Hall. This behavior indicates

Accepted Answer

A)  the ticket price was above the equilibrium price.
B)  the ticket price was below the equilibrium price.
C)  the ticket price was at the equilibrium price.
D)  nothing about the equilibrium price.E) B) and C)
F) None of the above

Question 20

The highest form of competition is called

Accepted Answer

A)  arbitrage.
B)  monopolistic competition.
C)  equilibrium.
D)  perfect competition.E) B) and D)
F) All of the above

Exam 4: The Market Forces of Supply and Demand

The highest form of competition is called

Correct Answer
verified

If something happens to alter the quantity demanded at any given price, then

Correct Answer
verified

The line that relates the price of a good and the quantity supplied of that good is called the supply

Correct Answer
verified

Supply refers to the position of the supply curve, whereas the quantity supplied refers to the amount suppliers wish to sell.

Correct Answer
verified

A decrease in the price of a complement will shift the demand curve for a good to the left.

Correct Answer
verified

In a competitive market, the quantity of a product produced and the price of the product are determined by

Correct Answer
verified

Figure 4-4 -Refer to Figure 4-4. Which of the following would cause the demand curve to shift from Demand B to Demand C in the market for DVDs in the United States?

Correct Answer
verified

The law of demand states that, 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.

Correct Answer
verified

If a study by medical researchers finds that eating brown rice causes weight loss while eating white rice causes weight gain, then we likely would see

Correct Answer
verified

When a shortage exists in a market, sellers

Correct Answer
verified

What would happen to the equilibrium price and quantity of peanut butter if the price of peanuts went up, the price of jelly fell, fewer firms decided to produce peanut butter, and health officials announced that eating peanut butter was good for you?

Correct Answer
verified

Years ago, thousands of country music fans risked their lives by rushing to buy tickets for a Willie Nelson concert at Carnegie Hall. This behavior indicates

Correct Answer
verified

Public service announcements, mandatory health warnings on cigarette packages, and the prohibition of cigarette advertising on television are all policies aimed at shifting the demand curve for cigarettes to the right.

Correct Answer
verified

For a market for a good or service to exist, there must be a

Correct Answer
verified

If a higher price means a greater quantity supplied, then the supply curve slopes upward.

Correct Answer
verified

When the market price is above the equilibrium price, suppliers are unable to sell all they want to sell.

Correct Answer
verified

Assume the market for tennis balls is perfectly competitive. When one tennis ball producer exits the market,

Correct Answer
verified

Correct Answer
verified

The line that relates the price of a good and the quantity demanded of that good is called the demand

Correct Answer
verified

Figure 4-15 -Refer to Figure 4-15. At what price would there be an excess demand of 200 units of the good?

Correct Answer
verified

Exam 4: The Market Forces of Supply and Demand

The highest form of competition is called

Correct AnswerverifiedShow Answer

If something happens to alter the quantity demanded at any given price, then

Correct AnswerverifiedShow Answer

The line that relates the price of a good and the quantity supplied of that good is called the supply

Correct AnswerverifiedShow Answer

Supply refers to the position of the supply curve, whereas the quantity supplied refers to the amount suppliers wish to sell.

Correct AnswerverifiedShow Answer

A decrease in the price of a complement will shift the demand curve for a good to the left.

Correct AnswerverifiedShow Answer

In a competitive market, the quantity of a product produced and the price of the product are determined by

Correct AnswerverifiedShow Answer

Figure 4-4 -Refer to Figure 4-4. Which of the following would cause the demand curve to shift from Demand B to Demand C in the market for DVDs in the United States?

Correct AnswerverifiedShow Answer

The law of demand states that, 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.

Correct AnswerverifiedShow Answer

If a study by medical researchers finds that eating brown rice causes weight loss while eating white rice causes weight gain, then we likely would see

Correct AnswerverifiedShow Answer

When a shortage exists in a market, sellers

Correct AnswerverifiedShow Answer

What would happen to the equilibrium price and quantity of peanut butter if the price of peanuts went up, the price of jelly fell, fewer firms decided to produce peanut butter, and health officials announced that eating peanut butter was good for you?

Correct AnswerverifiedShow Answer

Years ago, thousands of country music fans risked their lives by rushing to buy tickets for a Willie Nelson concert at Carnegie Hall. This behavior indicates

Correct AnswerverifiedShow Answer

Public service announcements, mandatory health warnings on cigarette packages, and the prohibition of cigarette advertising on television are all policies aimed at shifting the demand curve for cigarettes to the right.

Correct AnswerverifiedShow Answer

For a market for a good or service to exist, there must be a

Correct AnswerverifiedShow Answer

If a higher price means a greater quantity supplied, then the supply curve slopes upward.

Correct AnswerverifiedShow Answer

When the market price is above the equilibrium price, suppliers are unable to sell all they want to sell.

Correct AnswerverifiedShow Answer

Assume the market for tennis balls is perfectly competitive. When one tennis ball producer exits the market,

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The line that relates the price of a good and the quantity demanded of that good is called the demand

Correct AnswerverifiedShow Answer

Figure 4-15 -Refer to Figure 4-15. At what price would there be an excess demand of 200 units of the good?

Correct AnswerverifiedShow Answer

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