Question 1

Which of the following pairs of goods are likely to be complements for a large group of consumers?

Accepted Answer

A)  televisions and radios
B)  cars and trucks
C)  tea and coffee
D)  e-readers and e-books
E)  tents and tent-trailers

Question 2

Which statement best describes the ʺlaw of demandʺ? Other things being equal,the quantity of tennis rackets demanded will be greater if the

Accepted Answer

A)  incomes of tennis players are higher.
B)  price of tennis rackets is lower.
C)  price of badminton rackets is higher.
D)  number of tennis players is higher.
E)  demand for tennis rackets rises.

Question 3

Which of the following would cause a movement along the demand curve for ski-lift tickets,other things being equal?

Accepted Answer

A)  a change in tastes in favour of skiing
B)  an increase in price as the supply curve for lift tickets shifts to the left
C)  a rise in the price of ski boots and skis
D)  a rise in average household income
E)  an increase in population

Question 4

Suppose we observe that movie theatre prices are less during the daytime than in the evening.If the supply of movies does not change between daytime and evening,then the most likely explanation for this difference in price is

Accepted Answer

A)  the evening demand curve is to the left of the daytime demand curve.
B)  the evening demand curve is to the right of the daytime demand curve.
C)  the evening supply curve is to the left of the daytime supply curve.
D)  the evening supply curve is to the right of the daytime supply curve.

Question 5

If goods X and Y are substitutes and the price of X falls,all other things being equal,the demand curve for Y will

Accepted Answer

A)  shift to the left.
B)  shift to the right.
C)  not shift at all.
D)  be indeterminate.

Question 6

For a given commodity,quantity demanded can be represented by

Accepted Answer

A)  a demand curve.
B)  a demand schedule.
C)  a point on a demand curve.
D)  the money value of the stock of the commodity held by households.
E)  the price on the vertical axis.

Question 7

The time period to which quantity demanded refers when constructing demand curves is

Accepted Answer

A)  a moment in time.
B)  a long period of time.
C)  one year.
D)  any specified time period.
E)  a period shorter than one year.

Question 8

Suppose the demand and supply curves in the market for apples have the following functional form: Q D = 250 - 4p and QS = 10 + p.If the prevailing market price is 40,then

Accepted Answer

A)  the market is clearing.
B)  the market exhibits an excess supply of 50 units.
C)  the market exhibits an excess supply of 40 units.
D)  the market exhibits an excess demand of 50 units.
E)  the market exhibits an excess demand of 40 units.

Question 9

In which statement is the term ʺdemandʺ used correctly? (1) An increase in the price of copper will lead to a decrease in the demand for copper.(2) An increase in the price of copper will lead to an increase in the demand for aluminum (a substitute for copper) .

Accepted Answer

A)  neither statement
B)  the first statement only
C)  the second statement only
D)  both statements
E)  more information is needed

Question 10

A variable that is a ʺstockʺ

Accepted Answer

A)  is measured per unit of time.
B)  has meaning only at a point in time.
C)  has only to do with products where inventory is kept.
D)  has the same units as a flow variable.
E)  is used only in accounting.

Question 11

A demand curve represents graphically

Accepted Answer

A)  a functional statement of the income-quantity relationship.
B)  the timeless relationship between quantity demanded and price.
C)  the quantity demanded per unit of time at various prices.
D)  the available quantities at all possible prices for the product.
E)  quantity demanded.

Question 12

What is an inferior good?

Accepted Answer

A)  a good that everyone normally consumes
B)  a good that inferior people consume
C)  a good for which demand varies directly with household income
D)  a good for which demand varies inversely with household income
E)  a good for which demand does not vary with household income

Question 13

Ceteris paribus means

Accepted Answer

A)  other things being equal.
B)  and so forth.
C)  knowledge gained before the study of evidence is made.
D)  among other things.
E)  in a historical context.

Question 14

A ʺdecrease in supplyʺ refers to which of the following?

Accepted Answer

A)  the likely result from a decrease in the price of a factor of production
B)  a downward movement along a supply curve
C)  a decrease in quantity supplied
D)  a leftward shift in the supply curve
E)  a drop in the quantity actually exchanged

Question 15

Goods X and Y are defined to be substitutes in consumption if

Accepted Answer

A)  the supply of Y varies inversely with the price of X.
B)  the two goods are virtually the same.
C)  the supply of Y varies directly with the price of X.
D)  the demand for Y varies directly with the price of X.
E)  the demand for Y varies inversely with the price of X.

Question 16

A change in which of the following variables will result in NO change in the demand for a given commodity?

Accepted Answer

A)  average household income
B)  the distribution of income
C)  population
D)  tastes in favour of the commodity
E)  the price of the commodity

Question 17

Which of the following events would result in a change in the quantity demanded for some commodity but NOT a change in the demand for that commodity?

Accepted Answer

A)  a change in average household income
B)  a change in the distribution of income
C)  a change in population
D)  a change in tastes in favour of the commodity
E)  a change in the price of the commodity

Question 18

Consider the global market for barley,an agricultural commodity.Suppose that in August,2014,the equilibrium price and quantity were P = $150 per tonne and Q = 350 million tonnes.In August,2015,the equilibrium price and quantity were P = $140 per tonne and Q = 325 million tonnes.Which of the following is the best possible explanation for this change in market equilibrium?

Accepted Answer

A)  There has been an increase in supply of barley.
B)  There has been a decrease in supply of barley.
C)  There has been a simultaneous increase in demand and increase in supply of barley.
D)  There has been a decrease in demand for barley.
E)  There has been an increase in demand for barley.

Question 19

Suppose an index of average prices of imported goods in Canada indicates an increase in price of 2.3% over a 12-month period.Over the same period the Consumer Price Index indicates an increase in the general price level of 2.3%.What is the change in the price of imports relative to the change in the overall price level?

Accepted Answer

A)  an increase of 2.3%
B)  an increase of 4.6%
C)  a decrease of 2.3%
D)  a decrease of 4.6%
E)  no change

Question 20

Suppose that many coal mines are shut for environmental reasons.This will cause

Accepted Answer

A)  an increase in the supply of coal (a rightward shift of the supply curve) .
B)  a decrease in the supply of coal (a leftward shift of the supply curve) .
C)  a movement up the supply curve.
D)  a movement down the supply curve.
E)  no change in the supply curve,only a change in price.

Exam 3: Demand, supply, and Price

A change in which of the following variables will result in NO change in the demand for a given commodity?

Correct Answer
verified

Which of the following events would result in a change in the quantity demanded for some commodity but NOT a change in the demand for that commodity?

Correct Answer
verified

What is an inferior good?

Correct Answer
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Suppose we observe that movie theatre prices are less during the daytime than in the evening.If the supply of movies does not change between daytime and evening,then the most likely explanation for this difference in price is

Correct Answer
verified

A demand curve represents graphically

Correct Answer
verified

Which statement best describes the ʺlaw of demandʺ? Other things being equal,the quantity of tennis rackets demanded will be greater if the

Correct Answer
verified

Correct Answer
verified

If goods X and Y are substitutes and the price of X falls,all other things being equal,the demand curve for Y will

Correct Answer
verified

Ceteris paribus means

Correct Answer
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A variable that is a ʺstockʺ

Correct Answer
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In which statement is the term ʺdemandʺ used correctly? (1) An increase in the price of copper will lead to a decrease in the demand for copper.(2) An increase in the price of copper will lead to an increase in the demand for aluminum (a substitute for copper) .

Correct Answer
verified

Which of the following would cause a movement along the demand curve for ski-lift tickets,other things being equal?

Correct Answer
verified

The time period to which quantity demanded refers when constructing demand curves is

Correct Answer
verified

A ʺdecrease in supplyʺ refers to which of the following?

Correct Answer
verified

Suppose that many coal mines are shut for environmental reasons.This will cause

Correct Answer
verified

Suppose the demand and supply curves in the market for apples have the following functional form: Q D = 250 - 4p and QS = 10 + p.If the prevailing market price is 40,then

Correct Answer
verified

Goods X and Y are defined to be substitutes in consumption if

Correct Answer
verified

For a given commodity,quantity demanded can be represented by

Correct Answer
verified

Which of the following pairs of goods are likely to be complements for a large group of consumers?

Correct Answer
verified

Correct Answer
verified

Exam 3: Demand, supply, and Price

A change in which of the following variables will result in NO change in the demand for a given commodity?

Correct AnswerverifiedShow Answer

Which of the following events would result in a change in the quantity demanded for some commodity but NOT a change in the demand for that commodity?

Correct AnswerverifiedShow Answer

What is an inferior good?

Correct AnswerverifiedShow Answer

Suppose we observe that movie theatre prices are less during the daytime than in the evening.If the supply of movies does not change between daytime and evening,then the most likely explanation for this difference in price is

Correct AnswerverifiedShow Answer

A demand curve represents graphically

Correct AnswerverifiedShow Answer

Which statement best describes the ʺlaw of demandʺ? Other things being equal,the quantity of tennis rackets demanded will be greater if the

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

If goods X and Y are substitutes and the price of X falls,all other things being equal,the demand curve for Y will

Correct AnswerverifiedShow Answer

Ceteris paribus means

Correct AnswerverifiedShow Answer

A variable that is a ʺstockʺ

Correct AnswerverifiedShow Answer

In which statement is the term ʺdemandʺ used correctly? (1) An increase in the price of copper will lead to a decrease in the demand for copper.(2) An increase in the price of copper will lead to an increase in the demand for aluminum (a substitute for copper) .

Correct AnswerverifiedShow Answer

Which of the following would cause a movement along the demand curve for ski-lift tickets,other things being equal?

Correct AnswerverifiedShow Answer

The time period to which quantity demanded refers when constructing demand curves is

Correct AnswerverifiedShow Answer

A ʺdecrease in supplyʺ refers to which of the following?

Correct AnswerverifiedShow Answer

Suppose that many coal mines are shut for environmental reasons.This will cause

Correct AnswerverifiedShow Answer

Suppose the demand and supply curves in the market for apples have the following functional form: Q D = 250 - 4p and QS = 10 + p.If the prevailing market price is 40,then

Correct AnswerverifiedShow Answer

Goods X and Y are defined to be substitutes in consumption if

Correct AnswerverifiedShow Answer

For a given commodity,quantity demanded can be represented by

Correct AnswerverifiedShow Answer

Which of the following pairs of goods are likely to be complements for a large group of consumers?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

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