Question 1

If the price of product L increases, the demand curve for close-substitute product J will

Accepted Answer

A)   shift downward toward the horizontal axis.
B)   shift to the left.
C)   shift to the right.
D)   remain unchanged.

Question 2

Other things equal, an excise tax on a product will

Accepted Answer

A)   increase its supply.
B)   increase its price.
C)   increase the quantity sold.
D)   increase its demand.

Question 3

An increase in quantity supplied might be caused by an increase in resource costs.

Accepted Answer

A) True 
 B)False

Question 4

Refer to the diagram. An effective government-set price ﬂoor is best illustrated by

Accepted Answer

A)   price A.
B)   quantity E.
C)   price C.
D)   price B.

Question 5

An increase in the price of product A will

Accepted Answer

A)   reduce the demand for resources used in the production of A.
B)   increase the demand for complementary product C.
C)   increase the demand for substitute product B.
D)   reduce the demand for substitute product B.

Question 6

Refer to the diagram. If this is a competitive market, price and quantity will move toward

Accepted Answer

A)   $60 and 100, respectively.
B)   $60 and 200, respectively.
C)   $40 and 150, respectively.
D)   $20 and 150, respectively.

Question 7

Refer to the diagram. A government price support program to aid farmers is best illustrated by

Accepted Answer

A)   quantity E.
B)   price C.
C)   price A.
D)   price B.

Question 8

Which of the following factors is a "demand shifter" for new houses?

Accepted Answer

A)   the price of lumber
B)   wages for construction workers
C)   the price of new houses
D)   the interest rates on mortgage loans

Question 9

A government tax per unit of output reduces supply.

Accepted Answer

A) True 
 B)False

Question 10

Other things being equal, the law of demand suggests that as

Accepted Answer

A)   the demand for iPads increases, this will cause the price to increase.
B)   income increases, the quantity of iPads demanded will increase.
C)   the price of iPads decreases, the quantity demanded will increase.
D)   the price of iPads decreases, the quantity demanded will decrease.

Question 11

(1) (2) (3) (4) (5) QdQd Price QSQS5040$1070806050960708060850609070740501008063040\begin{array} { | c | c | c | c | c | } \hline ( 1 )  & ( 2 )  & ( 3 )  & ( 4 )  & ( 5 )  \Q _ { d } & Q _ { d } & 	ext { Price } & Q _ { S } & Q _ { S } \\hline 50 & 40 & \$ 10 & 70 & 80 \\hline 60 & 50 & 9 & 60 & 70 \\hline 80 & 60 & 8 & 50 & 60 \\hline 90 & 70 & 7 & 40 & 50 \\hline 100 & 80 & 6 & 30 & 40 \\hline\end{array}(1) Qd​50608090100​(2) Qd​4050607080​(3)  Price $109876​(4) QS​7060504030​(5) QS​8070605040​​  Refer to the table. If demand is represented by columns (3)  and (1)  and supply is represented by columns (3)  and (4) , equilibrium price and quantity will be

Accepted Answer

A)   $10 and 60 units.
B)   $9 and 60 units.
C)   $8 and 80 units.
D)   $8 and 60 units.

Question 12

If an economy produces its most wanted goods but uses outdated production methods, it is

Accepted Answer

A)   achieving productive eﬃciency but not allocative eﬃciency.
B)   not achieving productive eﬃciency.
C)   achieving both productive and allocative eﬃciency.
D)   engaged in roundabout production.

Question 13

Price Per  Unit Quantity Demanded Per YearQuantity Supplied Per Year$52,0000101,800300151,600600201,400900251,2001,200301,0001,500\begin{array} { | c | c | c | } \hline \begin{array} { c } 	ext { Price Per } \	ext { Unit }\end{array} & 	ext{Quantity Demanded Per Year}&	ext{Quantity Supplied Per Year} \\hline \$ 5 & 2,000 & 0 \\hline 10 & 1,800 & 300 \\hline 15 & 1,600 & 600 \\hline 20 & 1,400 & 900 \\hline 25 & 1,200 & 1,200 \\hline 30 & 1,000 & 1,500 \\hline\end{array} Price Per  Unit ​$51015202530​Quantity Demanded Per Year2,0001,8001,6001,4001,2001,000​Quantity Supplied Per Year03006009001,2001,500​​  Refer to the above table. In this competitive market, the price and quantity will settle at

Accepted Answer

A)   $10 and 2,000 units.
B)   $15 and 1,600 units.
C)   $20 and 900 units.
D)   $25 and 1,200 units.

Question 14

Refer to the diagram. Rent controls are best illustrated by

Accepted Answer

A)   price A.
B)   quantity E.
C)   price C.
D)   price B.

Question 15

Over a period of time, the equilibrium price of a good increases and the quantity decreases. All of the following could account for this situation, except

Accepted Answer

A)   an increase in the costs of production.
B)   the removal of a subsidy on the good or service.
C)   the imposition of a sales tax on the good or service.
D)   a decrease in the price of an alternative good or service that producers could also produce.

Question 16

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.

Question 17

Refer to the above diagram for the milk market. In this market, the equilibrium price is ____ and equilibrium quantity is ___.

Accepted Answer

A)   $1.50 per gallon; 28 million gallons
B)   $1.50 per gallon; 30 million gallons
C)   $28 per gallon; 150 million gallons
D)   $1.00 per gallon; 35 million gallons

Exam 3: Demand, Supply, and Market Equilibrium

Refer to the diagram. A government price support program to aid farmers is best illustrated by

Correct Answer
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An increase in quantity supplied might be caused by an increase in resource costs.

Correct Answer
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An increase in the price of product A will

Correct Answer
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Other things being equal, the law of demand suggests that as

Correct Answer
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A government subsidy to the producers of a product

Correct Answer
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If an economy produces its most wanted goods but uses outdated production methods, it is

Correct Answer
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Other things equal, an excise tax on a product will

Correct Answer
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Which of the following factors is a "demand shifter" for new houses?

Correct Answer
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If the price of product L increases, the demand curve for close-substitute product J will

Correct Answer
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Refer to the diagram. Rent controls are best illustrated by

Correct Answer
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Over a period of time, the equilibrium price of a good increases and the quantity decreases. All of the following could account for this situation, except

Correct Answer
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Correct Answer
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A government tax per unit of output reduces supply.

Correct Answer
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Refer to the above diagram for the milk market. In this market, the equilibrium price is __ and equilibrium quantity is _.

Correct Answer
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Refer to the diagram. An effective government-set price ﬂoor is best illustrated by

Correct Answer
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Refer to the diagram. If this is a competitive market, price and quantity will move toward

Correct Answer
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Exam 3: Demand, Supply, and Market Equilibrium

Refer to the diagram. A government price support program to aid farmers is best illustrated by

Correct AnswerverifiedShow Answer

An increase in quantity supplied might be caused by an increase in resource costs.

Correct AnswerverifiedShow Answer

An increase in the price of product A will

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Other things being equal, the law of demand suggests that as

Correct AnswerverifiedShow Answer

A government subsidy to the producers of a product

Correct AnswerverifiedShow Answer

If an economy produces its most wanted goods but uses outdated production methods, it is

Correct AnswerverifiedShow Answer

Other things equal, an excise tax on a product will

Correct AnswerverifiedShow Answer

Which of the following factors is a "demand shifter" for new houses?

Correct AnswerverifiedShow Answer

If the price of product L increases, the demand curve for close-substitute product J will

Correct AnswerverifiedShow Answer

Refer to the diagram. Rent controls are best illustrated by

Correct AnswerverifiedShow Answer

Over a period of time, the equilibrium price of a good increases and the quantity decreases. All of the following could account for this situation, except

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A government tax per unit of output reduces supply.

Correct AnswerverifiedShow Answer

Refer to the above diagram for the milk market. In this market, the equilibrium price is ____ and equilibrium quantity is ___.

Correct AnswerverifiedShow Answer

Refer to the diagram. An effective government-set price ﬂoor is best illustrated by

Correct AnswerverifiedShow Answer

Refer to the diagram. If this is a competitive market, price and quantity will move toward

Correct AnswerverifiedShow Answer

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Refer to the above diagram for the milk market. In this market, the equilibrium price is __ and equilibrium quantity is _.

Correct Answer
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Correct Answer
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Correct Answer
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