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-The above figure illustrates the market for corn.If point a represents the original equilibrium and point b the new equilibrium,which of the following could have caused the change? A) an increase in consumers' preferences for corn B) an increase in consumers' income if corn is a normal good C) an increase in labor costs of producing corn D) an improvement in the technology of producing corn E) an increase in consumers' income if corn is an inferior good -The above figure illustrates the market for corn.If point "a" represents the original equilibrium and point "b" the new equilibrium,which of the following could have caused the change?


A) an increase in consumers' preferences for corn
B) an increase in consumers' income if corn is a normal good
C) an increase in labor costs of producing corn
D) an improvement in the technology of producing corn
E) an increase in consumers' income if corn is an inferior good

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 Quantity demanded  (tons of cat food per year)  Price  (dollars per pound of cat  food)  Quantity supplied  (tons of cat food per year) 521.0015461.5026432.0034402.5040353.0044\begin{array} { c c c } \begin{array} { c } \text { Quantity demanded } \\\text { (tons of cat food per year) }\end{array} & \begin{array} { c } \text { Price } \\\text { (dollars per pound of cat } \\\text { food) }\end{array} & \begin{array} { c } \text { Quantity supplied } \\\text { (tons of cat food per year) }\end{array} \\\hline 52 & 1.00 & 15 \\46 & 1.50 & 26 \\43 & 2.00 & 34 \\40 & 2.50 & 40 \\35 & 3.00 & 44 \\\hline\end{array} -The above table gives the demand and supply schedules for cat food.If the price is $3.00 per pound of cat food,will there be a shortage,a surplus,or is this price the equilibrium price? If there is a shortage,how much is the shortage? If there is a surplus,how much is the surplus? If $3.00 is the equilibrium price,what is the equilibrium quantity?

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At a price of $3.00 per pound ...

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If income increases and the demand for bus rides decreases,


A) bus rides are a normal good.
B) consumers are behaving irrationally.
C) bus rides are an inferior good.
D) bus rides are a substitute good.
E) bus rides must be a complement good with some other good.

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If good weather conditions result in a larger than normal crop of peaches,then the


A) equilibrium price of peaches rises, and the equilibrium quantity of peaches increases.
B) equilibrium price of peaches falls, and the equilibrium quantity of peaches increases.
C) demand curve for peaches shifts leftward.
D) increase in the supply of peaches induces a greater demand for peaches, so that the equilibrium price rises and the equilibrium quantity increases.
E) equilibrium price of peaches falls, and the equilibrium quantity of peaches decreases.

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When the demand for a good decreases,its equilibrium price ________ and equilibrium quantity ________.


A) falls; decreases
B) falls; increases
C) rises; decreases
D) rises; increases
E) falls; does not change

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-The above figure shows the market for pizza.The market is in equilibrium when the cheese used to produce pizza falls in price.What point represents the most likely new price and quantity? A) A B) B C) C D) D E) E -The above figure shows the market for pizza.The market is in equilibrium when the cheese used to produce pizza falls in price.What point represents the most likely new price and quantity?


A) A
B) B
C) C
D) D
E) E

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The downward slope of a demand curve


A) represents the law of demand.
B) shows that as the price of a good rises, consumers increase the quantity they demand.
C) indicates how the quantity demanded changes when incomes rise and the good is a normal good.
D) indicates how demand changes when incomes rise and the good is a normal good.
E) indicates how demand changes when the price changes and the good is a normal good.

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-In the above figure,the movement from point a to point b reflects A) an increase in the price of pizza. B) an increase in the supply of pizza. C) an increase in the number of producers of pizza. D) a decrease in the cost of the tomato sauce used to produce pizza. E) a decrease in income if pizza is a normal good. -In the above figure,the movement from point a to point b reflects


A) an increase in the price of pizza.
B) an increase in the supply of pizza.
C) an increase in the number of producers of pizza.
D) a decrease in the cost of the tomato sauce used to produce pizza.
E) a decrease in income if pizza is a normal good.

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Pizza and tacos are substitutes,and the price of a pizza increases.Which of the following correctly indicates what happens?


A) The demand for pizzas decreases and the demand for tacos increases.
B) The demand for both goods decreases.
C) The quantity of tacos demanded increases and the quantity of pizza demanded decreases.
D) The quantity of pizza demanded decreases and the demand for tacos increases.
E) The demand for each decreases because both are normal goods.

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The "law of demand" refers to the fact that,other things remaining the same,when the price of a good rises,


A) the demand curve shifts rightward.
B) the demand curve shifts leftward.
C) there is a movement down along the demand curve to a larger quantity demanded.
D) there is a movement up along the demand curve to a smaller quantity demanded.
E) the demand curve shifts rightward and there is a movement up along the demand curve to a smaller quantity demanded.

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Suppose that the demand curve for desktop computers shifts rightward and at the same time the supply curve shifts leftward.Which of the following could have caused these shifts?


A) Desktop computers are a normal good and incomes increased, while more firms entered the market.
B) The price of a laptop computer, a substitute for desktop computers, fell, and the cost of producing desktop computers decreased.
C) Consumers purchased more computers because of the Christmas season, and the labor costs of producing desktop computers decreased.
D) Desktop computers are a normal good and incomes increased, while the labor costs of producing personal computers increased.
E) Desktop computers are a normal good and incomes decreased, while the labor costs of producing personal computers increased.

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If the demand for digital cameras increases when consumers' incomes rise,then digital cameras are


A) a normal good.
B) an inferior good.
C) a substitute for camcorders.
D) a complement to camcorders.
E) made using advanced technology.

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-The above figure shows the market for game day t-shirts.If the price of t-shirts is $8,then A) the market is in equilibrium. B) there is a surplus and the price of t-shirts will rise. C) the quantity demanded is greater than quantity supplied. D) there is a shortage and the price of t-shirts will fall. E) there is a surplus and the price of t-shirts will fall. -The above figure shows the market for game day t-shirts.If the price of t-shirts is $8,then


A) the market is in equilibrium.
B) there is a surplus and the price of t-shirts will rise.
C) the quantity demanded is greater than quantity supplied.
D) there is a shortage and the price of t-shirts will fall.
E) there is a surplus and the price of t-shirts will fall.

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-In the figure above,if point a represents the original equilibrium and point b the new equilibrium,then A) there has been an increase in supply. B) there has been an increase in demand. C) there has been a change in the quantity supplied and no change in supply. D) Both answers B and C are correct. E) Both answers A and B are correct. -In the figure above,if point "a" represents the original equilibrium and point "b" the new equilibrium,then


A) there has been an increase in supply.
B) there has been an increase in demand.
C) there has been a change in the quantity supplied and no change in supply.
D) Both answers B and C are correct.
E) Both answers A and B are correct.

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What leads to a decrease in the quantity demanded of a good or service?

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The quantity demande...

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Milk can be used to produce cheese or butter.If the price of a pound of butter rises,what happens to the supply of cheese?


A) The supply of cheese increases.
B) The supply of cheese decreases.
C) The supply of cheese stays the same, and there is no change in the quantity supplied of cheese.
D) The supply of cheese stays the same, and there is a decrease in the quantity supplied of cheese.
E) The supply of cheese could increase, decrease, or stay the same depending on what happens to the supply of butter.

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-Contractors can use plywood or brick to construct walls.Suppose the price of bricks increases.Which of the figures above best illustrates the effect of this change on the market for plywood? A) Figure A B) Figure B C) Figure C D) Figure D E) Figure A or Figure C depending on how contractors react to the higher price of bricks. -Contractors can use plywood or brick to construct walls.Suppose the price of bricks increases.Which of the figures above best illustrates the effect of this change on the market for plywood?


A) Figure A
B) Figure B
C) Figure C
D) Figure D
E) Figure A or Figure C depending on how contractors react to the higher price of bricks.

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-Which figure above shows the effect of an increase in the cost of the tomato sauce used to produce pizza? A) Figure A B) Figure B C) Figure C D) Figure D E) Both Figure B and Figure C -Which figure above shows the effect of an increase in the cost of the tomato sauce used to produce pizza?


A) Figure A
B) Figure B
C) Figure C
D) Figure D
E) Both Figure B and Figure C

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Suppose that the equilibrium price and quantity of new houses both increase.Which of the following could be a cause of this change?


A) The wage paid carpenters who build new houses might have risen.
B) A technological advance in framing a new house might have occurred.
C) The rent for nearby apartments might have fallen.
D) More home buyers might have moved into the area.
E) The cost of wood framing used to build houses might have fallen.

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Consider the market for bread.If the price of wheat rises,then the


A) demand curve for bread shifts leftward.
B) supply curve of bread shifts leftward.
C) price of bread falls.
D) equilibrium quantity of bread increases.
E) demand curve for bread shifts rightward.

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