Question 1

Table 4-15
The following table shows the number of cases of water each seller is willing to sell at the prices listed.
 
-Refer to Table 4-15. Assuming these are the only four suppliers in this market and the function for market demand is QD=1000-100P, where QD is the quantity demanded and P is the price, what is the equilibrium price?

Accepted Answer

The answer of Table 4-15
The following table shows the number...

Question 2

Which of the following is not an example of a market?

Accepted Answer

A)   A small town has only one seller of electricity.
B)   In the United States, a sick person cannot legally purchase a kidney.
C)   In Florida, there are many buyers and sellers of key lime pie.
D)   The availability of Internet shopping has expanded the clothing choices for buyers who do not live near large cities.E) A) and B)
F) A) and C)

Question 3

If the demand for a product decreases, 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) A) and D)
F) B) and C)

Question 4

If car manufacturers begin using new labor-saving technology on their assembly lines, we would not expect

Accepted Answer

A)   a smaller quantity of labor to be used.
B)   the supply of cars to increase.
C)   the firms' costs to fall.
D)   individual car manufacturers to move up and to the right along their individual supply curves.E) B) and D)
F) None of the above

Question 5

Which of the following is an example of a less-than-highly-organized market?

Accepted Answer

A)   the market for U.S. Treasury bonds
B)   the market for corn
C)   the market for soybeans
D)   the market for ice creamE) All of the above
F) A) and D)

Question 6

Suppose that when the price of a 16 oz. to-go cup of gourmet coffee is $4.25, students purchase 750 cups per day. If the price decreases to $3.75 per cup, which of the following is the most likely outcome?

Accepted Answer

A)   Students would purchase fewer than 750 cups per day.
B)   Student would continue to purchase 750 cups per day.
C)   Students would purchase more than 750 cups per day.
D)   We do not have enough information to answer this question.E) None of the above
F) B) and C)

Question 7

Opponents of cigarette taxes often argue that tobacco and marijuana are substitutes so that high cigarette prices

Accepted Answer

A)   encourage marijuana use, and the evidence supports this argument.
B)   encourage marijuana use, but the evidence does not support this argument.
C)   discourage marijuana use, and the evidence supports this argument.
D)   discourage marijuana use, but the evidence does not support this argument.E) A) and C)
F) C) and D)

Question 8

Table 4-13
The demand schedule below pertains to sandwiches demanded per week.
 
-Refer to Table 4-13. Suppose Harry, Darby, and Jake are the only demanders of sandwiches and that the market demand violates the law of demand. Then, in the table, the value of x must be

Accepted Answer

A)   less than or equal to 5.
B)   greater than or equal to 5.
C)   greater than or equal to 7.
D)   greater than or equal to 10.E) A) and B)
F) A) and C)

Question 9

In a competitive market, each seller has limited control over the price of his product because

Accepted Answer

A)   other sellers are offering similar products.
B)   buyers exert more control over the price than do sellers.
C)   these markets are highly regulated by the government.
D)   sellers usually agree to set a common price that will allow each seller to earn a comfortable profit.E) A) and B)
F) B) and D)

Question 10

Figure 4-29 
-Refer to Figure 4-29. The movement from S1 to S2 is a

Accepted Answer

The answer of Figure 4-29 
-Refer to Figure 4-29. The...

Question 11

Figure 4-17 
-Refer to Figure 4-17. 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) B) and C)
F) None of the above

Question 12

Figure 4-7 
-Refer to Figure 4-7. The movement from Da to Db in the market for potato chips could be caused by an)

Accepted Answer

A)   decrease in the price of potato chips.
B)   decrease in income, assuming that potato chips are a normal good.
C)   announcement by the FDA that potato chips cause cancer.
D)   increase in the price of a pretzels.E) B) and D)
F) A) and C)

Question 13

Which of the following demonstrates the law of supply?

Accepted Answer

A)   When leather became more expensive, belt producers decreased their supply of belts.
B)   When car production technology improved, car producers increased their supply of cars.
C)   When sweater producers expected sweater prices to rise in the near future, they decreased their current supply of sweaters.
D)   When ketchup prices rose, ketchup sellers increased their quantity supplied of ketchup.E) None of the above
F) B) and D)

Question 14

Figure 4-5 
-Refer to Figure 4-5. Which of the following would cause the demand curve to shift from Demand A to Demand B in the market for oranges in the United States?

Accepted Answer

A)   a freeze in Florida
B)   a technological advance that allows oranges to ripen faster
C)   a decrease in the price of apples
D)   an announcement by the FDA that oranges prevent heart diseaseE) None of the above
F) C) and D)

Question 15

The unique point at which the supply and demand curves intersect is called

Accepted Answer

A)   market harmony.
B)   coincidence.
C)   equivalence.
D)   equilibrium.E) None of the above
F) C) and D)

Question 16

Suppose the income of buyers in a market for an inferior good decreases and a technological advancement occurs also. What would we expect to happen in the market?

Accepted Answer

A)   Equilibrium price would decrease, but the impact on equilibrium quantity would be ambiguous.
B)   Equilibrium quantity would increase, but the impact on equilibrium price would be ambiguous.
C)   Equilibrium quantity would decrease, but the impact on equilibrium price would be ambiguous.
D)   None of the above is correct.E) B) and C)
F) A) and D)

Question 17

Price will rise to eliminate a shortage.

Accepted Answer

A) True 
 B)False

Question 18

Figure 4-18 
-Refer to Figure 4-18. At the equilibrium price,

Accepted Answer

A)   200 units would be supplied and demanded.
B)   400 units would be supplied and demanded.
C)   600 units would be supplied and demanded.
D)   600 units would be supplied, but only 200 would be demanded.E) A) and B)
F) All of the above

Question 19

Figure 4-27

-Refer to Figure 4-27. 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) A) and B)
F) C) and D)

Question 20

A very hot summer in Atlanta will cause

Accepted Answer

A)   the demand curve for lemonade to shift to the left.
B)   the demand for air conditioners to decrease.
C)   the demand for jackets to decrease.
D)   a movement downward and to the right along the demand curve for tank tops.E) A) and D)
F) C) and D)

Exam 4: The Market Forces of Supply and Demand

Which of the following is not an example of a market?

Correct Answer
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Figure 4-18 -Refer to Figure 4-18. At the equilibrium price,

Correct Answer
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Price will rise to eliminate a shortage.

Correct Answer
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Correct Answer
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Figure 4-17 -Refer to Figure 4-17. At a price of

Correct Answer
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Which of the following demonstrates the law of supply?

Correct Answer
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If the demand for a product decreases, then we would expect equilibrium price

Correct Answer
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In a competitive market, each seller has limited control over the price of his product because

Correct Answer
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Which of the following is an example of a less-than-highly-organized market?

Correct Answer
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Figure 4-5 -Refer to Figure 4-5. Which of the following would cause the demand curve to shift from Demand A to Demand B in the market for oranges in the United States?

Correct Answer
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Table 4-13 The demand schedule below pertains to sandwiches demanded per week. -Refer to Table 4-13. Suppose Harry, Darby, and Jake are the only demanders of sandwiches and that the market demand violates the law of demand. Then, in the table, the value of x must be

Correct Answer
verified

Suppose that when the price of a 16 oz. to-go cup of gourmet coffee is $4.25, students purchase 750 cups per day. If the price decreases to $3.75 per cup, which of the following is the most likely outcome?

Correct Answer
verified

Suppose the income of buyers in a market for an inferior good decreases and a technological advancement occurs also. What would we expect to happen in the market?

Correct Answer
verified

Opponents of cigarette taxes often argue that tobacco and marijuana are substitutes so that high cigarette prices

Correct Answer
verified

If car manufacturers begin using new labor-saving technology on their assembly lines, we would not expect

Correct Answer
verified

The unique point at which the supply and demand curves intersect is called

Correct Answer
verified

A very hot summer in Atlanta will cause

Correct Answer
verified

Figure 4-27 -Refer to Figure 4-27. 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?

Correct Answer
verified

Figure 4-29 -Refer to Figure 4-29. The movement from S1 to S2 is a

Correct Answer
verified

Figure 4-7 -Refer to Figure 4-7. The movement from Da to Db in the market for potato chips could be caused by an)

Correct Answer
verified

Exam 4: The Market Forces of Supply and Demand

Which of the following is not an example of a market?

Correct AnswerverifiedShow Answer

Figure 4-18 -Refer to Figure 4-18. At the equilibrium price,

Correct AnswerverifiedShow Answer

Price will rise to eliminate a shortage.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Figure 4-17 -Refer to Figure 4-17. At a price of

Correct AnswerverifiedShow Answer

Which of the following demonstrates the law of supply?

Correct AnswerverifiedShow Answer

If the demand for a product decreases, then we would expect equilibrium price

Correct AnswerverifiedShow Answer

In a competitive market, each seller has limited control over the price of his product because

Correct AnswerverifiedShow Answer

Which of the following is an example of a less-than-highly-organized market?

Correct AnswerverifiedShow Answer

Figure 4-5 -Refer to Figure 4-5. Which of the following would cause the demand curve to shift from Demand A to Demand B in the market for oranges in the United States?

Correct AnswerverifiedShow Answer

Table 4-13 The demand schedule below pertains to sandwiches demanded per week. -Refer to Table 4-13. Suppose Harry, Darby, and Jake are the only demanders of sandwiches and that the market demand violates the law of demand. Then, in the table, the value of x must be

Correct AnswerverifiedShow Answer

Suppose that when the price of a 16 oz. to-go cup of gourmet coffee is $4.25, students purchase 750 cups per day. If the price decreases to $3.75 per cup, which of the following is the most likely outcome?

Correct AnswerverifiedShow Answer

Suppose the income of buyers in a market for an inferior good decreases and a technological advancement occurs also. What would we expect to happen in the market?

Correct AnswerverifiedShow Answer

Opponents of cigarette taxes often argue that tobacco and marijuana are substitutes so that high cigarette prices

Correct AnswerverifiedShow Answer

If car manufacturers begin using new labor-saving technology on their assembly lines, we would not expect

Correct AnswerverifiedShow Answer

The unique point at which the supply and demand curves intersect is called

Correct AnswerverifiedShow Answer

A very hot summer in Atlanta will cause

Correct AnswerverifiedShow Answer

Figure 4-27 -Refer to Figure 4-27. 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?

Correct AnswerverifiedShow Answer

Figure 4-29 -Refer to Figure 4-29. The movement from S1 to S2 is a

Correct AnswerverifiedShow Answer

Figure 4-7 -Refer to Figure 4-7. The movement from Da to Db in the market for potato chips could be caused by an)

Correct AnswerverifiedShow Answer

Correct Answer
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