Question 1

Figure 4-22
 
-Refer to Figure 4-22. Panel (a)  shows which of the following?

Accepted Answer

A)   an increase in demand and an increase in quantity supplied
B)   an increase in demand and an increase in supply
C)   an increase in quantity demanded and an increase in quantity supplied
D)   an increase in quantity demanded and an increase in supply A

Question 2

Suppose roses are currently selling for $40 per dozen, but the equilibrium price of roses is $30 per dozen. We would expect a

Accepted Answer

A)   shortage to exist and the market price of roses to increase.
B)   shortage to exist and the market price of roses to decrease.
C)   surplus to exist and the market price of roses to increase.
D)   surplus to exist and the market price of roses to decrease.

Question 3

The law of supply and demand asserts that

Accepted Answer

A)   demand curves and supply curves tend to shift to the right as time goes by.
B)   the price of a good will eventually rise in response to an excess demand for that good.
C)   when the supply curve for a good shifts, the demand curve for that good shifts in response.
D)   the equilibrium price of a good will be rising more often than it will be falling.

Question 4

Table 4-9
The demand schedule below pertains to sandwiches demanded per week.
 
-Refer to Table 4-9. Suppose x = 1. Then it must be true that

Accepted Answer

A)   Harry and Jake have the same income, which is lower than Darby's income.
B)   if sandwiches and potato chips are complements for Harry, then those two goods are also complements for Jake.
C)   Harry's demand curve is identical to Jake's demand curve.
D)   All of the above are correct.

Question 5

Which of the following would not shift the demand curve for mp3 players?

Accepted Answer

A)   a decrease in the price of mp3 players
B)   a fad that makes mp3 players more popular among 12-25 year olds
C)   an increase in the price of digital music downloads, a complement for mp3 players
D)   a decrease in the price of satellite radio, a substitute for mp3 players A

Question 6

If the number of sellers in a market increases, then the

Accepted Answer

A)   demand in that market will increase.
B)   supply in that market will increase.
C)   supply in that market will decrease.
D)   demand in that market will decrease.

Question 7

Table 4-7
 
-Refer to Table 4-7. The equilibrium price and quantity, respectively, are

Accepted Answer

A)   $2 and 50 units.
B)   $6 and 30 units.
C)   $6 and 60 units.
D)   $12 and 30 units.

Question 8

If the demand for a product increases, then we would expect equilibrium price

Accepted Answer

A)   to increase and equilibrium quantity to decrease.
B)   to decrease and equilibrium quantity to increase.
C)   and equilibrium quantity both to increase.
D)   and equilibrium quantity both to decrease.

Question 9

All goods and services are sold in perfectly competitive markets.

Accepted Answer

A) True 
 B)False

Question 10

Suppose that demand for a good increases and, at the same time, supply of the good decreases. What would happen in the market for the good?

Accepted Answer

A)   Equilibrium price would decrease, but the impact on equilibrium quantity would be ambiguous.
B)   Equilibrium price would increase, but the impact on equilibrium quantity would be ambiguous.
C)   Equilibrium quantity would decrease, but the impact on equilibrium price would be ambiguous.
D)   Equilibrium quantity would increase, but the impact on equilibrium price would be ambiguous.

Question 11

In a competitive market, each seller has limited control over the price of his product because

Accepted Answer

A)   other sellers are offering similar products.
B)   buyers exert more control over the price than do sellers.
C)   these markets are highly regulated by the government.
D)   sellers usually agree to set a common price that will allow each seller to earn a comfortable profit.

Question 12

Figure 4-20
The graph below pertains to the supply of paper to colleges and universities.
 A to SB. D)  SB to SA. " class="answers-bank-image d-inline" rel="preload" >
-Refer to Figure 4-20. All else equal, an increase in the use of laptop computers for note-taking would cause a move from

Accepted Answer

A)   x to y.
B)   y to x.
C)   SA to SB.
D)   SB to SA.

Question 13

When the price of hot dogs changes, the demand curve for hot dogs

Accepted Answer

A)   shifts because the price of hot dogs is measured on the vertical axis of the graph.
B)   shifts because the quantity demanded of hot dogs is measured on the horizontal axis of the graph.
C)   does not shift because the price of hot dogs is measured on the vertical axis of the graph.
D)   does not shift because the price of hot dogs is measured on the horizontal axis of the graph.

Question 14

A decrease in the price of baseball bats will decrease the demand for baseballs.

Accepted Answer

A) True 
 B)False

Question 15

The dictionary defines equilibrium as a situation in which forces

Accepted Answer

A)   are in balance.
B)   are the same.
C)   clash.
D)   remain constant.

Question 16

If orange juice and apple juice are substitutes, an increase in the price of orange juice will shift the demand curve for apple juice to the left.

Accepted Answer

A) True 
 B)False

Question 17

Figure 4-22
 
-Refer to Figure 4-22. Which of the four panels represents the market for pizza delivery in a college town as we go from summer to the beginning of the fall semester?

Accepted Answer

A)   Panel (a) 
B)   Panel (b) 
C)   Panel (c) 
D)   Panel (d)

Question 18

Which of the following events would cause a movement upward and to the left along the demand curve for olives?

Accepted Answer

A)   The number of people who purchase olives decreases.
B)   Consumer income decreases, and olives are a normal good.
C)   The price of pickles decreases, and pickles are a substitute for olives.
D)   The price of olives rises. D

Question 19

A monopoly is a market with one

Accepted Answer

A)   seller, and that seller is a price taker.
B)   seller, and that seller sets the price.
C)   buyer, and that buyer is a price taker.
D)   buyer, and that buyer sets the price.

Question 20

Which of the following changes would not shift the supply curve for a good or service?

Accepted Answer

A)   a change in production technology
B)   a change in the price of the good or service
C)   a change in expectations about the future price of the good or service
D)   a change in input prices

Exam 4: The Market Forces of Supply and Demand

Figure 4-22 -Refer to Figure 4-22. Panel (a) shows which of the following?

Correct AnswerverifiedA

Suppose roses are currently selling for $40 per dozen, but the equilibrium price of roses is $30 per dozen. We would expect a

Correct AnswerverifiedShow Answer

The law of supply and demand asserts that

Correct AnswerverifiedShow Answer

Table 4-9 The demand schedule below pertains to sandwiches demanded per week. -Refer to Table 4-9. Suppose x = 1. Then it must be true that

Correct AnswerverifiedShow Answer

Which of the following would not shift the demand curve for mp3 players?

Correct AnswerverifiedA

If the number of sellers in a market increases, then the

Correct AnswerverifiedShow Answer

Table 4-7 -Refer to Table 4-7. The equilibrium price and quantity, respectively, are

Correct AnswerverifiedShow Answer

If the demand for a product increases, then we would expect equilibrium price

Correct AnswerverifiedShow Answer

All goods and services are sold in perfectly competitive markets.

Correct AnswerverifiedShow Answer

Suppose that demand for a good increases and, at the same time, supply of the good decreases. What would happen in the market for the good?

Correct AnswerverifiedShow Answer

In a competitive market, each seller has limited control over the price of his product because

Correct AnswerverifiedShow Answer

Figure 4-20 The graph below pertains to the supply of paper to colleges and universities. -Refer to Figure 4-20. All else equal, an increase in the use of laptop computers for note-taking would cause a move from

Correct AnswerverifiedShow Answer

When the price of hot dogs changes, the demand curve for hot dogs

Correct AnswerverifiedShow Answer

A decrease in the price of baseball bats will decrease the demand for baseballs.

Correct AnswerverifiedShow Answer

The dictionary defines equilibrium as a situation in which forces

Correct AnswerverifiedShow Answer

If orange juice and apple juice are substitutes, an increase in the price of orange juice will shift the demand curve for apple juice to the left.

Correct AnswerverifiedShow Answer

Figure 4-22 -Refer to Figure 4-22. Which of the four panels represents the market for pizza delivery in a college town as we go from summer to the beginning of the fall semester?

Correct AnswerverifiedShow Answer

Which of the following events would cause a movement upward and to the left along the demand curve for olives?

Correct AnswerverifiedD

A monopoly is a market with one

Correct AnswerverifiedShow Answer

Which of the following changes would not shift the supply curve for a good or service?

Correct AnswerverifiedShow Answer

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A

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D

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