Question 1

In the following question you are asked to determine,other things equal,the effects of a given change in a determinant of demand or supply for product X upon (1) the demand (D) for,or supply (S) of,X; (2) the equilibrium price (P) of X;and (3) the equilibrium quantity (Q) of X. An increase in income,if X is a normal good,will:

Accepted Answer

A)   increase D,increase P,and increase Q.
B)   increase D,increase P,and decrease Q.
C)   increase S,increase P,and increase Q.
D)   decrease D,increase P,and increase Q.E) A) and B)
F) B) and D)

Question 2

Because of unseasonably cold weather,the supply of oranges has substantially decreased.This statement indicates that:

Accepted Answer

A)   the demand for oranges will necessarily rise.
B)   the equilibrium quantity of oranges will rise.
C)   the amount of oranges that will be available at various prices has declined.
D)   the price of oranges will fall.E) None of the above
F) All of the above

Question 3

Ticket scalping refers to:

Accepted Answer

A)   the surplus of tickets that occurs when price is set below equilibrium.
B)   the shortage of tickets that occurs when price is set above equilibrium.
C)   pricing tickets so high that an athletic or artistic event will not be sold out.
D)   reselling a ticket at a price above its original purchase price.E) B) and D)
F) B) and C)

Question 4

Other things equal,which of the following might shift the demand curve for gasoline to the left?

Accepted Answer

A)   The discovery of vast new tar sands oil reserves in Canada
B)   The development of a low-cost electric automobile
C)   An increase in the price of train and air transportation
D)   A large decline in the price of automobilesE) A) and B)
F) None of the above

Question 5

One reason that the quantity demanded of a good increases when its price falls is that the:

Accepted Answer

A)   price decline shifts the supply curve to the left.
B)   lower price shifts the demand curve to the left.
C)   lower price shifts the demand curve to the right.
D)   lower price increases the real incomes of buyers,enabling them to buy more.E) A) and D)
F) None of the above

Question 6

Suppose that tacos and pizza are substitutes,and soda and pizza are complements.We would expect an increase in the price of pizza to:

Accepted Answer

A)   reduce the demand for tacos and increase the demand for sodas.
B)   reduce the demand for soda and increase the demand for tacos.
C)   increase the demand for both soda and tacos.
D)   reduce the demand for both soda and tacos.E) All of the above
F) A) and D)

Question 7

A product market is in equilibrium:

Accepted Answer

A)   when there is no surplus of the product.
B)   when there is no shortage of the product.
C)   when consumers want to buy more of the product than producers offer for sale.
D)   where the demand and supply curves intersect.E) C) and D)
F) None of the above

Question 8

If a legal price ceiling is set above the equilibrium price:

Accepted Answer

A)   a shortage of the product will occur.
B)   a surplus of the product will occur.
C)   a black market will evolve.
D)   neither the equilibrium price nor the equilibrium quantity will be affected.E) B) and C)
F) A) and D)

Question 9

Refer to the above data.If the price in this market was $4:

Accepted Answer

A)   the market would clear;quantity demanded would equal quantity supplied.
B)   buyers would want to purchase more wheat than is currently being supplied.
C)   farmers would not be able to sell all their wheat.
D)   there would be a shortage of wheat.E) All of the above
F) A) and D)

Question 10

1 to S2. C)  shift from S2 to S1. D)  move from point x to point y." class="answers-bank-image d-inline" rel="preload" > Refer to the above diagram.An increase in quantity supplied is depicted by a:

Accepted Answer

A)   move from point y to point x.
B)   shift from S1 to S2.
C)   shift from S2 to S1.
D)   move from point x to point y.E) B) and D)
F) A) and C)

Question 11

In the following question you are asked to determine,other things equal,the effects of a given change in a determinant of demand or supply for product X upon (1) the demand (D) for,or supply (S) of,X; (2) the equilibrium price (P) of X;and (3) the equilibrium quantity (Q) of X. An increase in the price of a product that is a close substitute for X will:

Accepted Answer

A)   decrease D,increase P,and decrease Q.
B)   increase D,increase P,and decrease Q.
C)   increase D,increase P,and increase Q.
D)   increase D,decrease P,and increase Q.E) A) and B)
F) None of the above

Question 12

A government subsidy to the producers of a product:

Accepted Answer

A)   reduces product supply.
B)   increases product supply.
C)   reduces product demand.
D)   increases product demand.E) B) and C)
F) None of the above

Question 13

Ticket scalping is likely to:

Accepted Answer

A)   produce a less interested audience.
B)   reduce the well-being of ticket sellers.
C)   reduce the well-being of ticket buyers.
D)   produce a more interested audience.E) A) and D)
F) B) and C)

Question 14

Economists use the term "demand" to refer to:

Accepted Answer

A)   a particular price-quantity combination on a stable demand curve.
B)   the total amount spent on a particular commodity over a stipulated time period.
C)   an upsloping line on a graph that relates consumer purchases and product price.
D)   a schedule of various combinations of market prices and amounts demanded.E) C) and D)
F) A) and C)

Question 15

College students living off-campus frequently consume large amounts of boxed macaroni and cheese.When they finish school and start their careers,their consumption of this good frequently declines.This suggests that boxed macaroni and cheese is:

Accepted Answer

A)   an inferior good.
B)   a normal good.
C)   a complementary good.
D)   a substitute good.E) B) and C)
F) C) and D)

Question 16

If we say that a price is too high to clear the market,we mean that:

Accepted Answer

A)   quantity demanded exceeds quantity supplied.
B)   the equilibrium price is above the current price.
C)   quantity supplied exceeds quantity demanded.
D)   the price of the good is likely to rise.E) All of the above
F) C) and D)

Question 17

If a product is in surplus supply,its price:

Accepted Answer

A)   is below the equilibrium level.
B)   is above the equilibrium level.
C)   will rise in the near future.
D)   is in equilibrium.E) C) and D)
F) A) and B)

Question 18

Effective price ceilings and price floors:

Accepted Answer

A)   cause surpluses and shortages,respectively.
B)   make the rationing function of free markets more efficient.
C)   interfere with the rationing function of prices.
D)   shift demand and supply curves and therefore have no effect on the rationing function of prices.E) A) and D)
F) B) and C)

Question 19

1 and D1 represent the original supply and demand curves and S2 and D2 the new curves.In this market: A)  supply has decreased and equilibrium price has increased. B)  demand has increased and equilibrium price has decreased. C)  demand has decreased and equilibrium price has decreased. D)  demand has increased and equilibrium price has increased." class="answers-bank-image d-inline" rel="preload" > Refer to the above diagram,in which S1 and D1 represent the original supply and demand curves and S2 and D2 the new curves.In this market:

Accepted Answer

A)   supply has decreased and equilibrium price has increased.
B)   demand has increased and equilibrium price has decreased.
C)   demand has decreased and equilibrium price has decreased.
D)   demand has increased and equilibrium price has increased.E) B) and D)
F) B) and C)

Question 20

Which of the above diagrams illustrate(s) the effect of an increase in the price of Budweiser beer on the market for Coors beer?

Accepted Answer

A)   A and C
B)   A only
C)   B only
D)   C onlyE) B) and C)
F) C) and D)

Exam 3: Demand, Supply, and Market Equilibrium

Because of unseasonably cold weather,the supply of oranges has substantially decreased.This statement indicates that:

Correct Answer
verified

Suppose that tacos and pizza are substitutes,and soda and pizza are complements.We would expect an increase in the price of pizza to:

Correct Answer
verified

Economists use the term "demand" to refer to:

Correct Answer
verified

Correct Answer
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If a product is in surplus supply,its price:

Correct Answer
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One reason that the quantity demanded of a good increases when its price falls is that the:

Correct Answer
verified

Refer to the above data.If the price in this market was $4:

Correct Answer
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A government subsidy to the producers of a product:

Correct Answer
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Effective price ceilings and price floors:

Correct Answer
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Refer to the above diagram,in which S₁ and D₁ represent the original supply and demand curves and S₂ and D₂ the new curves.In this market:

Correct Answer
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If we say that a price is too high to clear the market,we mean that:

Correct Answer
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If a legal price ceiling is set above the equilibrium price:

Correct Answer
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College students living off-campus frequently consume large amounts of boxed macaroni and cheese.When they finish school and start their careers,their consumption of this good frequently declines.This suggests that boxed macaroni and cheese is:

Correct Answer
verified

Which of the above diagrams illustrate(s) the effect of an increase in the price of Budweiser beer on the market for Coors beer?

Correct Answer
verified

Ticket scalping refers to:

Correct Answer
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Correct Answer
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Other things equal,which of the following might shift the demand curve for gasoline to the left?

Correct Answer
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Ticket scalping is likely to:

Correct Answer
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Refer to the above diagram.An increase in quantity supplied is depicted by a:

Correct Answer
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A product market is in equilibrium:

Correct Answer
verified

Exam 3: Demand, Supply, and Market Equilibrium

Because of unseasonably cold weather,the supply of oranges has substantially decreased.This statement indicates that:

Correct AnswerverifiedShow Answer

Suppose that tacos and pizza are substitutes,and soda and pizza are complements.We would expect an increase in the price of pizza to:

Correct AnswerverifiedShow Answer

Economists use the term "demand" to refer to:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

If a product is in surplus supply,its price:

Correct AnswerverifiedShow Answer

One reason that the quantity demanded of a good increases when its price falls is that the:

Correct AnswerverifiedShow Answer

Refer to the above data.If the price in this market was $4:

Correct AnswerverifiedShow Answer

A government subsidy to the producers of a product:

Correct AnswerverifiedShow Answer

Effective price ceilings and price floors:

Correct AnswerverifiedShow Answer

Refer to the above diagram,in which S1 and D1 represent the original supply and demand curves and S2 and D2 the new curves.In this market:

Correct AnswerverifiedShow Answer

If we say that a price is too high to clear the market,we mean that:

Correct AnswerverifiedShow Answer

If a legal price ceiling is set above the equilibrium price:

Correct AnswerverifiedShow Answer

College students living off-campus frequently consume large amounts of boxed macaroni and cheese.When they finish school and start their careers,their consumption of this good frequently declines.This suggests that boxed macaroni and cheese is:

Correct AnswerverifiedShow Answer

Which of the above diagrams illustrate(s) the effect of an increase in the price of Budweiser beer on the market for Coors beer?

Correct AnswerverifiedShow Answer

Ticket scalping refers to:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Other things equal,which of the following might shift the demand curve for gasoline to the left?

Correct AnswerverifiedShow Answer

Ticket scalping is likely to:

Correct AnswerverifiedShow Answer

Refer to the above diagram.An increase in quantity supplied is depicted by a:

Correct AnswerverifiedShow Answer

A product market is in equilibrium:

Correct AnswerverifiedShow Answer

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Refer to the above diagram,in which S₁ and D₁ represent the original supply and demand curves and S₂ and D₂ the new curves.In this market:

Correct Answer
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