Question 1

A decrease in the price of a product and an increase in the number of buyers in the market affect the demand curve in the same general way.

Accepted Answer

A) True 
 B)False

Question 2

If Miguel expects to earn a higher income next month, he may choose to

Accepted Answer

A)   save more now and spend less of his current income on goods and services.
B)   save less now and spend more of his current income on goods and services.
C)   decrease his current demand for goods and services.
D)   move along his current demand curves for goods and services.E) A) and D)
F) A) and B)

Question 3

It is not possible for demand and supply to shift at the same time.

Accepted Answer

A) True 
 B)False

Question 4

A market demand curve shows

Accepted Answer

A)   the relationship between price and the number of buyers in a market.
B)   how quantity demanded changes when the number of sellers changes.
C)   the sum of all prices that individual buyers are willing and able to pay for each possible quantity of the good.
D)   how much of a good all buyers are willing and able to buy at each possible price.E) C) and D)
F) None of the above

Question 5

During the last few decades in the United States, health officials have argued that eating too much beef might be harmful to human health. As a result, there has been a significant decrease in the amount of beef produced. Which of the following best explains the decrease in production?

Accepted Answer

A)   Beef producers, concerned about the health of their customers, decided to produce relatively less beef.
B)   Government officials, concerned about consumer health, ordered beef producers to produce relatively less beef.
C)   Individual consumers, concerned about their own health, decreased their demand for beef, which lowered the equilibrium price of beef, making it less attractive to produce.
D)   Anti-beef protesters have made it difficult for both buyers and sellers of beef to meet in the marketplace.E) A) and C)
F) None of the above

Question 6

If the price of ice cream rose to $30 per gallon, consumers would purchase fewer gallons of ice cream than if the price were $4 per gallon. If the price of chocolate sauce fell to $0.50 per can, consumers would purchase more chocolate sauce than if the price were $5 per can. These relationships illustrate the

Accepted Answer

A)   law of supply.
B)   law of demand.
C)   difference between normal and inferior goods.
D)   difference between substitute and complement goods.E) A) and B)
F) A) and C)

Question 7

Table 4-16
The following table shows the supply and demand schedules in a market.
 
-Refer to Table 4-16. At a price of $2, will there be a surplus or shortage of units in this market?

Accepted Answer

The answer of Table 4-16
The following table shows the supply...

Question 8

Pens are normal goods. What will happen to the equilibrium price of pens if the price of pencils rises, consumers experience an increase in income, writing in ink becomes fashionable, people expect the price of pens to rise in the near future, the population increases, fewer firms manufacture pens, and the wages of pen-makers increase?

Accepted Answer

A)   Price will rise.
B)   Price will fall.
C)   Price will stay exactly the same.
D)   The price change will be ambiguous.E) C) and D)
F) All of the above

Question 9

A supply curve slopes upward because

Accepted Answer

A)   as more is produced, total cost of production falls.
B)   an increase in input prices increases supply.
C)   the quantity supplied of most goods and services increases over time.
D)   an increase in price gives producers an incentive to supply a larger quantity.E) C) and D)
F) B) and D)

Question 10

Figure 4-27
Panel a)  Panel b) 
   Panel c)  Panel d) 
  
-Refer to Figure 4-27. Which of the four panels represents the market for cars as a result of the adoption of new technology on assembly lines?

Accepted Answer

A)   Panel a) 
B)   Panel b) 
C)   Panel c) 
D)   Panel d) E) B) and C)
F) A) and B)

Question 11

In a competitive market, the quantity of each good produced and the price at which it is sold are not determined by any single buyer or seller.

Accepted Answer

A) True 
 B)False

Question 12

A likely example of complementary goods for most people would be

Accepted Answer

A)   butter and margarine.
B)   lawnmowers and automobiles.
C)   chips and salsa.
D)   cola and lemonade.E) None of the above
F) C) and D)

Question 13

The law of demand is true for most goods in the economy.

Accepted Answer

A) True 
 B)False

Question 14

In a market, the price of any good adjusts until quantity demanded equals quantity supplied.

Accepted Answer

A) True 
 B)False

Question 15

If the demand for a product decreases, 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 to both increase.
D)   and equilibrium quantity to both decrease.E) A) and D)
F) C) and D)

Question 16

If the number of buyers in a market decreases, then

Accepted Answer

A)   demand will increase.
B)   demand will decrease.
C)   supply will increase.
D)   supply will decrease.E) A) and D)
F) A) and C)

Question 17

Suppose that a decrease in the price of good X results in fewer units of good Y being demanded. This implies that X and Y are

Accepted Answer

A)   complementary goods.
B)   normal goods.
C)   inferior goods.
D)   substitute goods.E) C) and D)
F) A) and B)

Question 18

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

Accepted Answer

A) True 
 B)False

Question 19

In a market economy, prices are the signals that guide the allocation of scarce resources.

Accepted Answer

A) True 
 B)False

Question 20

When quantity demanded decreases at every possible price, the demand curve has

Accepted Answer

A)   shifted to the left.
B)   shifted to the right.
C)   not shifted; rather, we have moved along the demand curve to a new point on the same curve.
D)   not shifted; rather, the demand curve has become flatter.E) C) and D)
F) B) and D)

Exam 4: The Market Forces of Supply and Demand

Suppose that a decrease in the price of good X results in fewer units of good Y being demanded. This implies that X and Y are

Correct Answer
verified

Correct Answer
verified

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

Correct Answer
verified

A likely example of complementary goods for most people would be

Correct Answer
verified

Table 4-16 The following table shows the supply and demand schedules in a market. -Refer to Table 4-16. At a price of $2, will there be a surplus or shortage of units in this market?

Correct Answer
verified

In a market, the price of any good adjusts until quantity demanded equals quantity supplied.

Correct Answer
verified

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

Correct Answer
verified

During the last few decades in the United States, health officials have argued that eating too much beef might be harmful to human health. As a result, there has been a significant decrease in the amount of beef produced. Which of the following best explains the decrease in production?

Correct Answer
verified

If Miguel expects to earn a higher income next month, he may choose to

Correct Answer
verified

If the number of buyers in a market decreases, then

Correct Answer
verified

In a competitive market, the quantity of each good produced and the price at which it is sold are not determined by any single buyer or seller.

Correct Answer
verified

In a market economy, prices are the signals that guide the allocation of scarce resources.

Correct Answer
verified

A market demand curve shows

Correct Answer
verified

A supply curve slopes upward because

Correct Answer
verified

A decrease in the price of a product and an increase in the number of buyers in the market affect the demand curve in the same general way.

Correct Answer
verified

When quantity demanded decreases at every possible price, the demand curve has

Correct Answer
verified

Correct Answer
verified

It is not possible for demand and supply to shift at the same time.

Correct Answer
verified

Figure 4-27 Panel a) Panel b) Panel c) Panel d) -Refer to Figure 4-27. Which of the four panels represents the market for cars as a result of the adoption of new technology on assembly lines?

Correct Answer
verified

The law of demand is true for most goods in the economy.

Correct Answer
verified

Exam 4: The Market Forces of Supply and Demand

Suppose that a decrease in the price of good X results in fewer units of good Y being demanded. This implies that X and Y are

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

A likely example of complementary goods for most people would be

Correct AnswerverifiedShow Answer

Table 4-16 The following table shows the supply and demand schedules in a market. -Refer to Table 4-16. At a price of $2, will there be a surplus or shortage of units in this market?

Correct AnswerverifiedShow Answer

In a market, the price of any good adjusts until quantity demanded equals quantity supplied.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

During the last few decades in the United States, health officials have argued that eating too much beef might be harmful to human health. As a result, there has been a significant decrease in the amount of beef produced. Which of the following best explains the decrease in production?

Correct AnswerverifiedShow Answer

If Miguel expects to earn a higher income next month, he may choose to

Correct AnswerverifiedShow Answer

If the number of buyers in a market decreases, then

Correct AnswerverifiedShow Answer

In a competitive market, the quantity of each good produced and the price at which it is sold are not determined by any single buyer or seller.

Correct AnswerverifiedShow Answer

In a market economy, prices are the signals that guide the allocation of scarce resources.

Correct AnswerverifiedShow Answer

A market demand curve shows

Correct AnswerverifiedShow Answer

A supply curve slopes upward because

Correct AnswerverifiedShow Answer

A decrease in the price of a product and an increase in the number of buyers in the market affect the demand curve in the same general way.

Correct AnswerverifiedShow Answer

When quantity demanded decreases at every possible price, the demand curve has

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

It is not possible for demand and supply to shift at the same time.

Correct AnswerverifiedShow Answer

Figure 4-27 Panel a) Panel b) Panel c) Panel d) -Refer to Figure 4-27. Which of the four panels represents the market for cars as a result of the adoption of new technology on assembly lines?

Correct AnswerverifiedShow Answer

The law of demand is true for most goods in the economy.

Correct AnswerverifiedShow Answer

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