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) A) and D)
F) All of the above

Question 2

Figure 4-3
 
-Refer to Figure 4-3. If these are the only two consumers in the market, then the market quantity demanded at a price of $6 is

Accepted Answer

A)   12 units.
B)   14 units.
C)   19 units.
D)   21 units.E) B) and C)
F) B) and D)

Question 3

Economists normally

Accepted Answer

A)   do not try to explain people's tastes, but they do try to explain what happens when tastes change.
B)   believe that they must be able to explain people's tastes in order to explain what happens when tastes change.
C)   do not believe that people's tastes determine demand, so they ignore the subject of tastes.
D)   incorporate tastes into economic models only to the extent that tastes determine whether pairs of goods are substitutes or complements.E) A) and C)
F) B) and C)

Question 4

Table 4-3
 
-Refer to Table 4-3. If these are the only four buyers in the market, then when the price increases from $1.00 to $1.50, the market quantity demanded

Accepted Answer

A)   decreases by 1.75 units.
B)   increases by 2 units.
C)   decreases by 7 units.
D)   decreases by 24 units.E) B) and D)
F) None of the above

Question 5

Which of the following might cause the supply curve for an inferior good to shift to the right?

Accepted Answer

A)   an increase in input prices
B)   a decrease in consumer income
C)   an improvement in production technology that makes production of the good more profitable
D)   a decrease in the number of sellers in the marketE) A) and B)
F) B) and C)

Question 6

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

Accepted Answer

A)   income.
B)   the prices of substitutes or complements.
C)   expectations about future prices.
D)   the price of the good or service that is being demanded.E) A) and B)
F) A) and C)

Question 7

Table 4-5
 
-Refer to Table 4-5. If these are the only four sellers in the market, then when the price decreases from $10 to $8, the market quantity supplied decreases by

Accepted Answer

A)   2.5 units.
B)   4 units.
C)   10 units.
D)   50 units.E) B) and C)
F) A) and D)

Question 8

Figure 4-22
 
-Refer to Figure 4-22. Panel (c)  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 supplyE) B) and C)
F) A) and B)

Question 9

For the general population, a 10 percent increase in the price of cigarettes leads to a

Accepted Answer

A)   1 percent reduction in the quantity demanded of cigarettes.
B)   4 percent reduction in the quantity demanded of cigarettes.
C)   10 percent reduction in the quantity demanded of cigarettes.
D)   12 percent reduction in the quantity demanded of cigarettes.E) None of the above
F) B) and D)

Question 10

If muffins and bagels are substitutes, a higher price for bagels would result in a(n)

Accepted Answer

A)   increase in the demand for bagels.
B)   decrease in the demand for bagels.
C)   increase in the demand for muffins.
D)   decrease in the demand for muffins.E) B) and D)
F) B) and C)

Question 11

The demand curve is the upward-sloping line relating price and quantity demanded.

Accepted Answer

A) True 
 B)False

Question 12

An increase in the price of pizza will shift the demand curve for pizza to the left.

Accepted Answer

A) True 
 B)False

Question 13

In markets, prices move toward equilibrium because of

Accepted Answer

A)   the actions of buyers and sellers.
B)   government regulations placed on market participants.
C)   increased competition among sellers.
D)   buyers' ability to affect market outcomes.E) A) and C)
F) A) and B)

Question 14

To obtain the market demand curve for a product, sum the individual demand curves

Accepted Answer

A)   vertically.
B)   diagonally.
C)   horizontally.
D)   and then average them.E) A) and C)
F) B) and C)

Question 15

Matthew bakes apple pies that he sells at the local farmer's market. If the price of apples increases, the

Accepted Answer

A)   supply curve for Matthew's pies will increase.
B)   supply curve for Matthew's pies will decrease.
C)   demand curve for Matthew's pies will increase.
D)   demand curve for Matthew's pies will decrease.E) B) and D)
F) A) and B)

Question 16

A decrease in the price of peanut butter will increase both the equilibrium price and quantity in the market for jelly.

Accepted Answer

A) True 
 B)False

Question 17

Sellers as a group determine the demand for a product, and buyers as a group determine the supply of a product.

Accepted Answer

A) True 
 B)False

Question 18

Whenever a determinant of supply other than price changes, the supply curve shifts.

Accepted Answer

A) True 
 B)False

Question 19

A decrease in supply is represented by a

Accepted Answer

A)   movement downward and to the left along a supply curve.
B)   movement upward and to the right along a supply curve.
C)   rightward shift of a supply curve.
D)   leftward shift of a supply curve.E) A) and D)
F) B) and D)

Question 20

Figure 4-4
 
-Refer to Figure 4-4. Which of the following would cause the demand curve to shift from Demand A to Demand B in the market for oranges in the United States?

Accepted Answer

A)   a freeze in Florida
B)   a technological advance that allows oranges to ripen faster
C)   a decrease in the price of apples
D)   an announcement by the FDA that oranges prevent heart diseaseE) None of the above
F) C) and D)

Exam 4: The Market Forces of Supply and Demand

Table 4-3 -Refer to Table 4-3. If these are the only four buyers in the market, then when the price increases from $1.00 to $1.50, the market quantity demanded

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Whenever a determinant of supply other than price changes, the supply curve shifts.

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Figure 4-3 -Refer to Figure 4-3. If these are the only two consumers in the market, then the market quantity demanded at a price of $6 is

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If muffins and bagels are substitutes, a higher price for bagels would result in a(n)

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A decrease in supply is represented by a

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A decrease in the price of peanut butter will increase both the equilibrium price and quantity in the market for jelly.

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Economists normally

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

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Matthew bakes apple pies that he sells at the local farmer's market. If the price of apples increases, the

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Which of the following might cause the supply curve for an inferior good to shift to the right?

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Table 4-5 -Refer to Table 4-5. If these are the only four sellers in the market, then when the price decreases from $10 to $8, the market quantity supplied decreases by

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An increase in the price of pizza will shift the demand curve for pizza to the left.

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To obtain the market demand curve for a product, sum the individual demand curves

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In markets, prices move toward equilibrium because of

Correct AnswerverifiedShow Answer

The demand curve is the upward-sloping line relating price and quantity demanded.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Sellers as a group determine the demand for a product, and buyers as a group determine the supply of a product.

Correct AnswerverifiedShow Answer

For the general population, a 10 percent increase in the price of cigarettes leads to a

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Figure 4-4 -Refer to Figure 4-4. Which of the following would cause the demand curve to shift from Demand A to Demand B in the market for oranges in the United States?

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