Question 1

Nemo rents 5 movies per month when the price is $3.00 per rental and 7 movies per month when the price is $2.50 per rental.Nemo's demand demonstrates the law of

Accepted Answer

A)   price.
B)   supply.
C)   demand.
D)   income.E) A) and C)
F) C) and D)

Question 2

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 3

Figure 4-3
 
-Refer to Figure 4-3.If these are the only two consumers in the market,then the market quantity demanded at a price of $6 is

Accepted Answer

A)   12 units.
B)   14 units.
C)   19 units.
D)   21 units.E) All of the above
F) A) and B)

Question 4

If the supply of a product increases,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.E) All of the above
F) C) and D)

Question 5

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) A) and C)
F) A) and B)

Question 6

Which of the following events would cause the price of oranges to fall?

Accepted Answer

A)   There is a shortage of oranges.
B)   The FDA announces that bananas cause strokes,and oranges and bananas are substitutes.
C)   The price of land throughout Florida decreases,and Florida produces a significant proportion of the nation's oranges.
D)   All of the above are correct.E) B) and D)
F) C) and D)

Question 7

An increase in the price of a good will

Accepted Answer

A)   increase supply.
B)   decrease supply.
C)   increase quantity supplied.
D)   decrease quantity supplied.E) None of the above
F) A) and B)

Question 8

When it comes to people's tastes,economists generally believe that

Accepted Answer

A)   tastes are based on forces that are well within the realm of economics.
B)   tastes are based on historical and psychological forces that are beyond the realm of economics.
C)   tastes can only be studied through well-constructed,real-life models.
D)   because tastes do not directly affect demand,there is little need to explain people's tastes.E) C) and D)
F) B) and D)

Question 9

Figure 4-20
The graph below pertains to the supply of paper to colleges and universities. A to SB. D)  SB to SA." class="answers-bank-image d-inline" rel="preload" >
-Refer to Figure 4-20.All else equal,sellers expecting the price of paper to decrease next month when many college students leave campuses for the summer would cause a current move from

Accepted Answer

A)   x to y.
B)   y to x.
C)   SA to SB.
D)   SB to SA.E) All of the above
F) C) and D)

Question 10

Music compact discs are normal goods.What will happen to the equilibrium price and quantity of music compact discs if musicians accept lower royalties,compact disc players become cheaper,more firms start producing music compact discs,and music lovers experience an increase in income?

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) All of the above

Question 11

Pens are normal goods.What will happen to the equilibrium price of pens if the price of pencils rises,consumers experience an increase in income,writing in ink becomes fashionable,people expect the price of pens to rise in the near future,the population increases,fewer firms manufacture pens,and the wages of pen-makers increase?

Accepted Answer

A)   Price will rise.
B)   Price will fall.
C)   Price will stay exactly the same.
D)   The price change will be ambiguous.E) A) and C)
F) C) and D)

Question 12

What would happen to the equilibrium price and quantity of coffee if the wages of coffee-bean pickers fell and the price of tea fell?

Accepted Answer

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

Question 13

If the producers of canned green beans expect the price of canned green beans to increase in the future due to an increase in demand,they may put some of their current production into storage and supply less in the market today.

Accepted Answer

A) True 
 B)False

Question 14

Figure 4-6 
-Refer to Figure 4-6.If the demand curve shifts from D to D',then

Accepted Answer

A)   firms would be willing to supply less of the good than before at each possible price.
B)   people are willing to buy less of the good than before at each possible price.
C)   people's incomes must have decreased.
D)   the price of the product has increased,causing consumers to buy less of the product.E) A) and B)
F) B) and C)

Question 15

In a market economy,supply and demand are important because they

Accepted Answer

A)   are direct policy tools used by government agencies to regulate the economy.
B)   illustrate when an market is in equilibrium,but they are not helpful when a market is out of equilibrium.
C)   can be used to predict the impact on the economy of various events and policies.
D)   All of the above are correct.E) None of the above
F) C) and D)

Question 16

Which of the following demonstrates the law of demand?

Accepted Answer

A)   After Jon got a raise at work,he bought more pretzels at $1.50 per pretzel than he did before his raise.
B)   Melissa buys fewer muffins at $0.75 per muffin than at $1 per muffin,other things equal.
C)   Dave buys more donuts at $0.25 per donut than at $0.50 per donut,other things equal.
D)   Kendra buys fewer Snickers at $0.60 per Snickers after the price of Milky Ways falls to $0.50 per Milky Way.E) A) and D)
F) B) and C)

Question 17

Figure 4-15 
-Refer to Figure 4-15.At a price of $35,there would be

Accepted Answer

A)   a shortage,and the price would tend to rise from $35 to a higher price.
B)   a surplus,and the price would tend to rise from $35 to a higher price.
C)   excess demand,and the price would tend to fall from $35 to a lower price.
D)   excess supply,and the price would tend to fall from $35 to a lower price.E) A) and B)
F) All of the above

Question 18

In a competitive market,there are so few buyers and so few sellers that each has a significant impact on the market price.

Accepted Answer

A) True 
 B)False

Question 19

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) B) and D)
F) None of the above

Question 20

If consumers often purchase muffins to eat while they drink their lattés at local coffee shops,what would happen to the equilibrium price and quantity of lattés if the price of muffins falls?

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 increase,and the equilibrium quantity would decrease.
D)   The equilibrium price would decrease,and the equilibrium quantity would increase.E) None of the above
F) A) and B)

Exam 4: The Market Forces of Supply and Demand

Which of the following events would cause the price of oranges to fall?

Correct Answer
verified

Figure 4-6 -Refer to Figure 4-6.If the demand curve shifts from D to D',then

Correct Answer
verified

If consumers often purchase muffins to eat while they drink their lattés at local coffee shops,what would happen to the equilibrium price and quantity of lattés if the price of muffins falls?

Correct Answer
verified

What would happen to the equilibrium price and quantity of coffee if the wages of coffee-bean pickers fell and the price of tea fell?

Correct Answer
verified

Figure 4-15 -Refer to Figure 4-15.At a price of $35,there would be

Correct Answer
verified

Which of the following demonstrates the law of demand?

Correct Answer
verified

In a market economy,supply and demand are important because they

Correct Answer
verified

Correct Answer
verified

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

Correct Answer
verified

If the producers of canned green beans expect the price of canned green beans to increase in the future due to an increase in demand,they may put some of their current production into storage and supply less in the market today.

Correct Answer
verified

Music compact discs are normal goods.What will happen to the equilibrium price and quantity of music compact discs if musicians accept lower royalties,compact disc players become cheaper,more firms start producing music compact discs,and music lovers experience an increase in income?

Correct Answer
verified

Figure 4-20 The graph below pertains to the supply of paper to colleges and universities. -Refer to Figure 4-20.All else equal,sellers expecting the price of paper to decrease next month when many college students leave campuses for the summer would cause a current move from

Correct Answer
verified

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

Correct Answer
verified

Figure 4-3 -Refer to Figure 4-3.If these are the only two consumers in the market,then the market quantity demanded at a price of $6 is

Correct Answer
verified

In a competitive market,there are so few buyers and so few sellers that each has a significant impact on the market price.

Correct Answer
verified

Soup is an inferior good if the demand

Correct Answer
verified

When it comes to people's tastes,economists generally believe that

Correct Answer
verified

Nemo rents 5 movies per month when the price is $3.00 per rental and 7 movies per month when the price is $2.50 per rental.Nemo's demand demonstrates the law of

Correct Answer
verified

An increase in the price of a good will

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

Exam 4: The Market Forces of Supply and Demand

Which of the following events would cause the price of oranges to fall?

Correct AnswerverifiedShow Answer

Figure 4-6 -Refer to Figure 4-6.If the demand curve shifts from D to D',then

Correct AnswerverifiedShow Answer

If consumers often purchase muffins to eat while they drink their lattés at local coffee shops,what would happen to the equilibrium price and quantity of lattés if the price of muffins falls?

Correct AnswerverifiedShow Answer

What would happen to the equilibrium price and quantity of coffee if the wages of coffee-bean pickers fell and the price of tea fell?

Correct AnswerverifiedShow Answer

Figure 4-15 -Refer to Figure 4-15.At a price of $35,there would be

Correct AnswerverifiedShow Answer

Which of the following demonstrates the law of demand?

Correct AnswerverifiedShow Answer

In a market economy,supply and demand are important because they

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

If the producers of canned green beans expect the price of canned green beans to increase in the future due to an increase in demand,they may put some of their current production into storage and supply less in the market today.

Correct AnswerverifiedShow Answer

Music compact discs are normal goods.What will happen to the equilibrium price and quantity of music compact discs if musicians accept lower royalties,compact disc players become cheaper,more firms start producing music compact discs,and music lovers experience an increase in income?

Correct AnswerverifiedShow Answer

Figure 4-20 The graph below pertains to the supply of paper to colleges and universities. -Refer to Figure 4-20.All else equal,sellers expecting the price of paper to decrease next month when many college students leave campuses for the summer would cause a current move from

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Figure 4-3 -Refer to Figure 4-3.If these are the only two consumers in the market,then the market quantity demanded at a price of $6 is

Correct AnswerverifiedShow Answer

In a competitive market,there are so few buyers and so few sellers that each has a significant impact on the market price.

Correct AnswerverifiedShow Answer

Soup is an inferior good if the demand

Correct AnswerverifiedShow Answer

When it comes to people's tastes,economists generally believe that

Correct AnswerverifiedShow Answer

Nemo rents 5 movies per month when the price is $3.00 per rental and 7 movies per month when the price is $2.50 per rental.Nemo's demand demonstrates the law of

Correct AnswerverifiedShow Answer

An increase in the price of a good will

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

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