Question 1

A movement along the supply curve might be caused by a change in

Accepted Answer

A)  production technology.
B)  input prices.
C)  expectations about future prices.
D)  the price of the good or service that is being supplied.E) None of the above
F) A) and C)

Question 2

Figure 4-1 
-Refer to Figure 4-1. It is apparent from the figure that the

Accepted Answer

A)  good is inferior.
B)  demand for the good decreases as income increases.
C)  demand for the good conforms to the law of demand.
D)  All of the above are correct.E) C) and D)
F) B) and D)

Question 3

Figure 4-29
​ 
-Refer to Figure 4-29. If the price increases from $5 to $6, how does the quantity demanded change?

Accepted Answer

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

Question 4

The belief that tobacco is a "gateway drug" is consistent with

Accepted Answer

A)  the idea that tobacco and marijuana are substitutes.
B)  the idea that an increase in income causes a decrease in the demand for tobacco and an increase in the demand for marijuana.
C)  the idea that lower cigarette prices are associated with less use of marijuana.
D)  most of the available evidence.E) A) and B)
F) A) and C)

Question 5

The difference between a supply schedule and a supply curve is that a supply schedule

Accepted Answer

A)  incorporates demand and a supply curve does not.
B)  incorporates profit and a supply curve does not.
C)  can shift, but a supply curve cannot shift.
D)  is a table, and a supply curve is drawn on a graph.E) B) and D)
F) A) and B)

Question 6

Suppose the United States had a short-term shortage of farmers. Which mechanisms would adjust to remove the shortage?

Accepted Answer

A)  The government would provide tax incentives to encourage people to become farmers.
B)  The government would subsidize the production of food.
C)  The prices of food and the wages of farmers would adjust.
D)  There are no mechanisms to remove the shortage.E) A) and D)
F) B) and C)

Question 7

Two goods are complements when a decrease in the price of one good

Accepted Answer

A)  decreases the quantity demanded of the other good.
B)  decreases the demand for the other good.
C)  increases the quantity demanded of the other good.
D)  increases the demand for the other good.E) None of the above
F) B) and D)

Question 8

A market includes

Accepted Answer

A)  buyers only.
B)  sellers only.
C)  both buyers and sellers.
D)  the place where transactions occur but not the people involved.E) C) and D)
F) B) and D)

Question 9

Suppose you make jewelry. If the price of gold falls, then we would expect you to

Accepted Answer

A)  be willing and able to produce less jewelry than before at each possible price.
B)  be willing and able to produce more jewelry than before at each possible price.
C)  face a greater demand for your jewelry.
D)  face a weaker demand for your jewelry.E) A) and B)
F) None of the above

Question 10

When a surplus exists in a market, sellers

Accepted Answer

A)  raise price, which increases quantity demanded and decreases quantity supplied, until the surplus is eliminated.
B)  raise price, which decreases quantity demanded and increases quantity supplied, until the surplus is eliminated.
C)  lower price, which increases quantity demanded and decreases quantity supplied, until the surplus is eliminated.
D)  lower price, which decreases quantity demanded and increases quantity supplied, until the surplus is eliminated.E) B) and C)
F) A) and D)

Question 11

At the equilibrium price, quantity demanded is equal to quantity supplied.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following events must cause equilibrium price 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) All of the above
F) None of the above

Question 13

When the price of a good is lower than the equilibrium price,

Accepted Answer

A)  a surplus will exist.
B)  buyers desire to purchase more than is produced.
C)  sellers desire to produce and sell more than buyers wish to purchase.
D)  quantity supplied exceeds quantity demanded.E) A) and C)
F) B) and C)

Question 14

A leftward shift of a demand curve is called a(n)

Accepted Answer

A)  increase in demand.
B)  decrease in demand.
C)  decrease in quantity demanded.
D)  increase in quantity demanded.E) B) and C)
F) A) and D)

Question 15

Table 4-16
The following table shows the supply and demand schedules in a market. 
-Refer to Table 4-16. At a price of $2, will there be a surplus or shortage of units in this market?

Accepted Answer

The answer of Table 4-16
The following table shows the supply...

Question 16

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

Question 17

Suppose that Amanda receives a pay increase. We would expect

Accepted Answer

A)  to observe Amanda moving down and to the right along her given demand curve.
B)  Amanda's demand for inferior goods to decrease.
C)  Amanda's demand for each of two goods that are complements to increase.
D)  Amanda's demand for normal goods to decrease.E) None of the above
F) A) and B)

Question 18

Table 4-10
The following table shows the number of cases of water each seller is willing to sell at the prices listed. 
-Refer to Table 4-10. If the four suppliers listed are the only suppliers in this market and the market quantity demanded is 500 cases when the price is $5.00, which of the following statements is correct?

Accepted Answer

A)  The market is in equilibrium at a price of $5.00.
B)  There is a surplus of 100 cases at a price of $5.00.
C)  There is a shortage of 100 cases at a price of $5.00.
D)  There is a shortage of 50 cases at a price of $5.00.E) B) and D)
F) B) and C)

Question 19

The law of demand states that, other things equal, when the price of a good rises, the quantity demanded of the good rises, and when the price falls, the quantity demanded falls.

Accepted Answer

A) True 
 B)False

Question 20

In competitive markets,

Accepted Answer

A)  firms produce identical products.
B)  no individual buyer can influence the market price.
C)  no individual seller can influence the market price.
D)  All of the above are correct.E) A) and B)
F) All of the above

Exam 4: The Market Forces of Supply and Demand

Table 4-16 The following table shows the supply and demand schedules in a market. -Refer to Table 4-16. At a price of $2, will there be a surplus or shortage of units in this market?

Correct Answer
verified

A movement along the supply curve might be caused by a change in

Correct Answer
verified

A market includes

Correct Answer
verified

Suppose you make jewelry. If the price of gold falls, then we would expect you to

Correct Answer
verified

In competitive markets,

Correct Answer
verified

Correct Answer
verified

Suppose that Amanda receives a pay increase. We would expect

Correct Answer
verified

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

Correct Answer
verified

When the price of a good is lower than the equilibrium price,

Correct Answer
verified

A leftward shift of a demand curve is called a(n)

Correct Answer
verified

Two goods are complements when a decrease in the price of one good

Correct Answer
verified

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

Correct Answer
verified

Figure 4-29 -Refer to Figure 4-29. If the price increases from $5 to $6, how does the quantity demanded change?

Correct Answer
verified

At the equilibrium price, quantity demanded is equal to quantity supplied.

Correct Answer
verified

The law of demand states that, other things equal, when the price of a good rises, the quantity demanded of the good rises, and when the price falls, the quantity demanded falls.

Correct Answer
verified

Suppose the United States had a short-term shortage of farmers. Which mechanisms would adjust to remove the shortage?

Correct Answer
verified

Figure 4-1 -Refer to Figure 4-1. It is apparent from the figure that the

Correct Answer
verified

The difference between a supply schedule and a supply curve is that a supply schedule

Correct Answer
verified

The belief that tobacco is a "gateway drug" is consistent with

Correct Answer
verified

When a surplus exists in a market, sellers

Correct Answer
verified

Exam 4: The Market Forces of Supply and Demand

Table 4-16 The following table shows the supply and demand schedules in a market. -Refer to Table 4-16. At a price of $2, will there be a surplus or shortage of units in this market?

Correct AnswerverifiedShow Answer

A movement along the supply curve might be caused by a change in

Correct AnswerverifiedShow Answer

A market includes

Correct AnswerverifiedShow Answer

Suppose you make jewelry. If the price of gold falls, then we would expect you to

Correct AnswerverifiedShow Answer

In competitive markets,

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Suppose that Amanda receives a pay increase. We would expect

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

When the price of a good is lower than the equilibrium price,

Correct AnswerverifiedShow Answer

A leftward shift of a demand curve is called a(n)

Correct AnswerverifiedShow Answer

Two goods are complements when a decrease in the price of one good

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Figure 4-29 ​ -Refer to Figure 4-29. If the price increases from $5 to $6, how does the quantity demanded change?

Correct AnswerverifiedShow Answer

At the equilibrium price, quantity demanded is equal to quantity supplied.

Correct AnswerverifiedShow Answer

The law of demand states that, other things equal, when the price of a good rises, the quantity demanded of the good rises, and when the price falls, the quantity demanded falls.

Correct AnswerverifiedShow Answer

Suppose the United States had a short-term shortage of farmers. Which mechanisms would adjust to remove the shortage?

Correct AnswerverifiedShow Answer

Figure 4-1 -Refer to Figure 4-1. It is apparent from the figure that the

Correct AnswerverifiedShow Answer

The difference between a supply schedule and a supply curve is that a supply schedule

Correct AnswerverifiedShow Answer

The belief that tobacco is a "gateway drug" is consistent with

Correct AnswerverifiedShow Answer

When a surplus exists in a market, sellers

Correct AnswerverifiedShow Answer

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Figure 4-29 -Refer to Figure 4-29. If the price increases from $5 to $6, how does the quantity demanded change?

Correct Answer
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Correct Answer
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