Question 1

If the number of sellers in a market increases,then the

Accepted Answer

A)   demand in that market will increase.
B)   supply in that market will increase.
C)   supply in that market will decrease.
D)   demand in that market will decrease.E) None of the above
F) B) and C)

Question 2

Buyers are able to buy all they want to buy and sellers are able to sell all they want to sell at

Accepted Answer

A)   prices at and above the equilibrium price.
B)   prices at and below the equilibrium price.
C)   prices above and below the equilibrium price,but not at the equilibrium price.
D)   the equilibrium price but not above or below the equilibrium price.E) None of the above
F) A) and B)

Question 3

The forces that make market economies work are

Accepted Answer

A)   work and leisure.
B)   politics and religion.
C)   supply and demand.
D)   taxes and government spending.E) A) and D)
F) None of the above

Question 4

Which of the following events must cause equilibrium quantity to rise?

Accepted Answer

A)   demand increases and supply decreases
B)   demand and supply both decrease
C)   demand decreases and supply increases
D)   demand and supply both increaseE) A) and B)
F) A) and C)

Question 5

If suppliers expect the price of their product to fall in the future,then they will

Accepted Answer

A)   decrease supply now.
B)   increase supply now.
C)   decrease supply in the future but not now.
D)   increase supply in the future but not now.E) A) and B)
F) A) and C)

Question 6

What will happen to the equilibrium price and quantity of new cars if the price of gasoline rises,the price of steel rises,public transportation becomes cheaper and more comfortable,and auto-workers negotiate higher wages?

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) C) and D)
F) B) and D)

Question 7

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

Accepted Answer

A)   a decrease in the price of golf balls
B)   an increase in the price of green fees
C)   an expectation by buyers that their incomes will increase in the very near future
D)   a change in consumer tastes away from golf and toward tennisE) A) and B)
F) A) and C)

Question 8

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

Accepted Answer

A) True 
 B)False

Question 9

A university's football stadium is never more than half-full during football games.This indicates

Accepted Answer

A)   the ticket price is above the equilibrium price.
B)   the ticket price is below the equilibrium price.
C)   the ticket price is at the equilibrium price.
D)   nothing about the equilibrium price.E) A) and B)
F) B) and C)

Question 10

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.E) A) and C)
F) A) and B)

Question 11

Suppose researchers discover a new,lower cost method of producing calculators.As a result,will the supply of calculators increase or decrease?

Accepted Answer

The supply...

Question 12

Figure 4-22

-Refer to Figure 4-22.Which of the four panels represents the market for pizza delivery in a college town as we go from summer to the beginning of the fall semester?

Accepted Answer

A)   Panel (a) 
B)   Panel (b) 
C)   Panel (c) 
D)   Panel (d) E) C) and D)
F) A) and D)

Question 13

Which of the following events could cause an increase in the supply of ceiling fans?

Accepted Answer

A)   The number of sellers of ceiling fans increases.
B)   There is an increase in the price of air conditioners,and consumers regard air conditioners and ceiling fans as substitutes.
C)   There is an increase in the price of the motor that powers ceiling fans.
D)   All of the above are correct.E) A) and D)
F) B) and C)

Question 14

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

Accepted Answer

A)   production technology
B)   the price of the good
C)   the prices of inputs
D)   expectationsE) All of the above
F) B) and D)

Question 15

The highest form of competition is called

Accepted Answer

A)   arbitrage.
B)   monopolistic competition.
C)   equilibrium.
D)   perfect competition.E) B) and C)
F) A) and C)

Question 16

When quantity supplied exceeds quantity demanded at the current market price,the market has a surplus,and market price will likely rise in the future to eliminate the surplus.

Accepted Answer

A) True 
 B)False

Question 17

A market supply curve is determined by

Accepted Answer

A)   vertically summing individual supply curves.
B)   horizontally summing individual supply curves.
C)   finding the average quantity supplied by sellers at each possible price.
D)   finding the average price at which sellers are willing and able to sell a particular quantity of the good.E) B) and D)
F) C) and D)

Question 18

Suppose an increase in the price of rubber coincides with an advance in the technology of tire production.As a result of these two events,the demand for tires

Accepted Answer

A)   decreases,and the supply of tires increases.
B)   is unaffected,and the supply of tires decreases.
C)   is unaffected,and the supply of tires increases.
D)   None of the above is necessarily correct.E) B) and D)
F) All of the above

Question 19

Holding the nonprice determinants of supply constant,a change in price would

Accepted Answer

A)   result in either a decrease in supply or an increase in supply.
B)   result in a movement along a stationary supply curve.
C)   result in a shift of demand.
D)   have no effect on the quantity supplied.E) C) and D)
F) B) and D)

Question 20

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) A) and D)
F) All of the above

Exam 4: The Market Forces of Supply and Demand

Suppose an increase in the price of rubber coincides with an advance in the technology of tire production.As a result of these two events,the demand for tires

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A market supply curve is determined by

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The highest form of competition is called

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

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Holding the nonprice determinants of supply constant,a change in price would

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When quantity supplied exceeds quantity demanded at the current market price,the market has a surplus,and market price will likely rise in the future to eliminate the surplus.

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The forces that make market economies work are

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

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A university's football stadium is never more than half-full during football games.This indicates

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What will happen to the equilibrium price and quantity of new cars if the price of gasoline rises,the price of steel rises,public transportation becomes cheaper and more comfortable,and auto-workers negotiate higher wages?

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

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Which of the following events must cause equilibrium quantity to rise?

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

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Suppose researchers discover a new,lower cost method of producing calculators.As a result,will the supply of calculators increase or decrease?

Correct AnswerverifiedThe supply...View AnswerShow Answer

If suppliers expect the price of their product to fall in the future,then they will

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Buyers are able to buy all they want to buy and sellers are able to sell all they want to sell at

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If the number of sellers in a market increases,then the

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Which of the following events could cause an increase in the supply of ceiling fans?

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

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Figure 4-22 -Refer to Figure 4-22.Which of the four panels represents the market for pizza delivery in a college town as we go from summer to the beginning of the fall semester?

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The supply...
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