Question 1

For the general population, a 10 percent increase in the price of cigarettes leads to a

Accepted Answer

A)   1 percent reduction in the quantity demanded of cigarettes.
B)   4 percent reduction in the quantity demanded of cigarettes.
C)   10 percent reduction in the quantity demanded of cigarettes.
D)   12 percent reduction in the quantity demanded of cigarettes.E) None of the above
F) A) and B)

Question 2

Other things equal, when the price of a good falls, the

Accepted Answer

A)   quantity supplied of the good increases.
B)   supply decreases.
C)   quantity supplied of the good decreases.
D)   demand increases.E) A) and D)
F) A) and B)

Question 3

A movement upward and to the left along a demand curve is called an)

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) B) and C)

Question 4

Figure 4-26 
-Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for bullet-proof vests of an increase in the price of Kevlar?

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) A) and D)
F) C) and D)

Question 5

Suppose the demand for calendars increases in November. At the same time, the price of the ink used in the production of calendars increases. In the market for calendars, the equilibrium price rises, but the effect on the equilibrium quantity is ambiguous.

Accepted Answer

A) True 
 B)False

Question 6

If mayonnaise and Miracle Whip are substitutes, then which of the following would increase the demand for Miracle Whip?

Accepted Answer

A)   a decrease in the price of Miracle Whip
B)   an increase in the price of mayonnaise
C)   a decrease in the price of mayonnaise
D)   Both a and b are correct.E) B) and C)
F) None of the above

Question 7

An early frost in the vineyards of Napa Valley would cause an)

Accepted Answer

A)   increase in the demand for wine, increasing price.
B)   increase in the supply of wine, decreasing price.
C)   decrease in the demand for wine, decreasing price.
D)   decrease in the supply of wine, increasing price.E) A) and B)
F) B) and C)

Question 8

Scenario 4-1
Suppose the demand schedule in a market can be represented by the equation
     , where  is the quantity demanded and is the price. Also, suppose the supply schedule can be represented by the equation , where is the quantity supplied.
-Refer to Scenario 4-1. Suppose the price is currently equal to 18 in this market. Is there a shortage or surplus in this market, and how large is the shortage/surplus?

Accepted Answer

There is a...

Question 9

A movement downward and to the left along a supply curve is called an)

Accepted Answer

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

Question 10

Today's supply curve for iPods could shift in response to a change in

Accepted Answer

A)   today's price of iPods.
B)   the expected future price of iPods.
C)   the number of buyers of iPods.
D)   All of the above are correct.E) B) and D)
F) C) and D)

Question 11

In a competitive market, the quantity of each good produced and the price at which it is sold are not determined by any single buyer or seller.

Accepted Answer

A) True 
 B)False

Question 12

In a market economy, supply and demand determine

Accepted Answer

A)   both the quantity of each good produced and the price at which it is sold.
B)   the quantity of each good produced but not the price at which it is sold.
C)   the price at which each good is sold but not the quantity of each good produced.
D)   neither the quantity of each good produced nor the price at which it is sold.E) C) and D)
F) B) and D)

Question 13

a. What is the difference between a "change in demand" and a "change in quantity demanded?" Graph your answer.
 b. For each of the following changes, determine whether there will be a change in quantity demanded or a change in demand.
i. a change in the price of a related good
ii. a change in tastes
iii. a change in the number of buyers
iv. a change in price
v. a change in consumer expectations
vi. a change in income

Accepted Answer

a. A change in demand refers to a shift ...

Question 14

When the market price is below the equilibrium price, the quantity of the good demanded exceeds the quantity supplied.

Accepted Answer

A) True 
 B)False

Question 15

If a company making frozen orange juice expects the price of its product to be higher next month, it will supply more to the market this month.

Accepted Answer

A) True 
 B)False

Question 16

An increase in the price of a good would

Accepted Answer

A)   increase the supply of the good.
B)   increase the amount purchased by buyers.
C)   give producers an incentive to produce more.
D)   decrease both the quantity demanded of the good and the quantity supplied of the good.E) All of the above
F) B) and C)

Question 17

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 18

The market supply curve

Accepted Answer

A)   is found by vertically adding the individual supply curves.
B)   slopes downward.
C)   represents the sum of the prices that all the sellers are willing to accept for a given quantity of the good.
D)   represents the sum of the quantities supplied by all the sellers at each price of the good.E) All of the above
F) None of the above

Question 19

Which of the following is not a characteristic of a perfectly competitive market?

Accepted Answer

A)   Different sellers sell identical products.
B)   There are many sellers.
C)   Sellers must accept the price the market determines.
D)   All of the above are characteristics of a perfectly competitive market.E) C) and D)
F) All of the above

Question 20

Figure 4-12
Firm A Firm B
  
-Refer to Figure 4-12. If these are the only two sellers in the market, then the market quantity supplied at a price of $6 is

Accepted Answer

A)   2 units.
B)   10 units.
C)   12 units.
D)   22 units.E) All of the above
F) A) and B)

Exam 4: The Market Forces of Supply and Demand

Figure 4-12 Firm A Firm B -Refer to Figure 4-12. If these are the only two sellers in the market, then the market quantity supplied at a price of $6 is

Correct Answer
verified

Other things equal, when the price of a good falls, the

Correct Answer
verified

If a company making frozen orange juice expects the price of its product to be higher next month, it will supply more to the market this month.

Correct Answer
verified

The market supply curve

Correct Answer
verified

Figure 4-26 -Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for bullet-proof vests of an increase in the price of Kevlar?

Correct Answer
verified

In a market economy, supply and demand determine

Correct Answer
verified

An early frost in the vineyards of Napa Valley would cause an)

Correct Answer
verified

Today's supply curve for iPods could shift in response to a change in

Correct Answer
verified

Which of the following is not a characteristic of a perfectly competitive market?

Correct Answer
verified

Suppose the demand for calendars increases in November. At the same time, the price of the ink used in the production of calendars increases. In the market for calendars, the equilibrium price rises, but the effect on the equilibrium quantity is ambiguous.

Correct Answer
verified

For the general population, a 10 percent increase in the price of cigarettes leads to a

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

In a competitive market, the quantity of each good produced and the price at which it is sold are not determined by any single buyer or seller.

Correct Answer
verified

When the market price is below the equilibrium price, the quantity of the good demanded exceeds the quantity supplied.

Correct Answer
verified

A movement upward and to the left along a demand curve is called an)

Correct Answer
verified

Correct Answer
verified
a. A change in demand refers to a shift ...
View Answer

If mayonnaise and Miracle Whip are substitutes, then which of the following would increase the demand for Miracle Whip?

Correct Answer
verified

Correct Answer
verified
There is a...
View Answer

A movement downward and to the left along a supply curve is called an)

Correct Answer
verified

An increase in the price of a good would

Correct Answer
verified

Exam 4: The Market Forces of Supply and Demand

Figure 4-12 Firm A Firm B -Refer to Figure 4-12. If these are the only two sellers in the market, then the market quantity supplied at a price of $6 is

Correct AnswerverifiedShow Answer

Other things equal, when the price of a good falls, the

Correct AnswerverifiedShow Answer

If a company making frozen orange juice expects the price of its product to be higher next month, it will supply more to the market this month.

Correct AnswerverifiedShow Answer

The market supply curve

Correct AnswerverifiedShow Answer

Figure 4-26 -Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for bullet-proof vests of an increase in the price of Kevlar?

Correct AnswerverifiedShow Answer

In a market economy, supply and demand determine

Correct AnswerverifiedShow Answer

An early frost in the vineyards of Napa Valley would cause an)

Correct AnswerverifiedShow Answer

Today's supply curve for iPods could shift in response to a change in

Correct AnswerverifiedShow Answer

Which of the following is not a characteristic of a perfectly competitive market?

Correct AnswerverifiedShow Answer

Suppose the demand for calendars increases in November. At the same time, the price of the ink used in the production of calendars increases. In the market for calendars, the equilibrium price rises, but the effect on the equilibrium quantity is ambiguous.

Correct AnswerverifiedShow Answer

For the general population, a 10 percent increase in the price of cigarettes leads to a

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

In a competitive market, the quantity of each good produced and the price at which it is sold are not determined by any single buyer or seller.

Correct AnswerverifiedShow Answer

When the market price is below the equilibrium price, the quantity of the good demanded exceeds the quantity supplied.

Correct AnswerverifiedShow Answer

A movement upward and to the left along a demand curve is called an)

Correct AnswerverifiedShow Answer

Correct Answerverifieda. A change in demand refers to a shift ...View AnswerShow Answer

If mayonnaise and Miracle Whip are substitutes, then which of the following would increase the demand for Miracle Whip?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedThere is a...View AnswerShow Answer

A movement downward and to the left along a supply curve is called an)

Correct AnswerverifiedShow Answer

An increase in the price of a good would

Correct AnswerverifiedShow Answer

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a. A change in demand refers to a shift ...
View Answer

Correct Answer
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Correct Answer
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There is a...
View Answer

Correct Answer
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Correct Answer
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