Question 1

Suppose scientists provide evidence that chocolate pudding increases the bad cholesterol levels of those who eat it.We would expect to see

Accepted Answer

A)   no change in the demand for chocolate pudding.
B)   a decrease in the demand for chocolate pudding.
C)   an increase in the demand for chocolate pudding.
D)   a decrease in the supply of chocolate pudding.E) A) and B)
F) A) and C)

Question 2

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.E) None of the above
F) C) and D)

Question 3

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 right.

Accepted Answer

A) True 
 B)False

Question 4

If scientists discover that steamed milk,which is used to make lattés,prevents heart attacks,what would happen to the equilibrium price and quantity of lattés?

Accepted Answer

A)   Both the equilibrium price and quantity would increase.
B)   Both the equilibrium price and quantity would decrease.
C)   The equilibrium price would increase, and the equilibrium quantity would decrease.
D)   The equilibrium price would decrease, and the equilibrium quantity would increase.E) None of the above
F) All of the above

Question 5

An increase in the price of oranges would lead to

Accepted Answer

A)   an increased supply of oranges.
B)   a reduction in the prices of inputs used in orange production.
C)   an increased demand for oranges.
D)   a movement up and to the right along the supply curve for oranges.E) All of the above
F) A) and C)

Question 6

Currently you purchase ten frozen pizza per month.You will graduate from college in December,and you will start a new job in January.You have no plans to purchase frozen pizzas in January.For you,frozen pizzas are a(n)

Accepted Answer

A)   substitute good.
B)   normal good.
C)   inferior good.
D)   complementary good.E) None of the above
F) A) and B)

Question 7

If car manufacturers begin using new labor-saving technology on their assembly lines,we would not expect

Accepted Answer

A)   a smaller quantity of labor to be used.
B)   the supply of cars to increase.
C)   the firms' costs to fall.
D)   individual car manufacturers to move up and to the right along their individual supply curves.E) None of the above
F) A) and C)

Question 8

Figure 4-9
 
-Refer to Figure 4-9.The movement from point A to point B on the graph represents

Accepted Answer

A)   an increased willingness and ability on the part of suppliers to supply the good at each possible price.
B)   an increase in the number of suppliers.
C)   a decrease in the price of a relevant input.
D)   an increase in the price of the good that is being supplied and the suppliers' responses to that price change.E) None of the above
F) A) and B)

Question 9

Suppose the demand for calendars increases in November.At the same time,the price of the ink used in the production of calendars increases.In the market for calendars,if the size of the shift of the demand curve is larger than the size of the shift of the supply curve,then the equilibrium quantity rises.

Accepted Answer

A) True 
 B)False

Question 10

An increase in the price of a good will

Accepted Answer

A)   increase supply.
B)   decrease supply.
C)   increase quantity supplied.
D)   decrease quantity supplied.E) C) and D)
F) None of the above

Question 11

Figure 4-21
 
-Refer to Figure 4-21.Which of the following movements would illustrate the effect in the market for chocolate chip cookies of a decrease in the price of flour?

Accepted Answer

A)   Point A to Point B
B)   Point C to Point B
C)   Point C to Point D
D)   Point A to Point DE) B) and D)
F) None of the above

Question 12

A newspaper's classified ads are an example of a market.

Accepted Answer

A) True 
 B)False

Question 13

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.E) B) and C)
F) B) and D)

Question 14

Which of the following events would unambiguously cause a decrease in the equilibrium price of cotton shirts?

Accepted Answer

A)   an increase in the price of wool shirts and a decrease in the price of raw cotton
B)   a decrease in the price of wool shirts and a decrease in the price of raw cotton
C)   an increase in the price of wool shirts and an increase in the price of raw cotton
D)   a decrease in the price of wool shirts and an increase in the price of raw cottonE) B) and C)
F) A) and D)

Question 15

New oak tables are normal goods.What would happen to the equilibrium price and quantity in the market for oak tables if the price of maple tables rises,the price of oak wood rises,more buyers enter the market for oak tables,and the price of the glue used in the production of the new oak tables increased?

Accepted Answer

A)   Price will fall, and the effect on quantity is ambiguous.
B)   Price will rise, and the effect on quantity is ambiguous.
C)   Quantity will fall, and the effect on price is ambiguous.
D)   Quantity will rise, and the effect on price is ambiguous.E) None of the above
F) All of the above

Question 16

Once the supply curve for a product or service is drawn,it

Accepted Answer

A)   remains stable over time.
B)   can shift either rightward or leftward.
C)   is possible to move along the curve, but the curve will not shift.
D)   tends to become steeper over time.E) B) and C)
F) None of the above

Question 17

Figure 4-6
 
-Refer to Figure 4-6.If the demand curve shifts from D to D',then

Accepted Answer

A)   firms would be willing to supply less of the good than before at each possible price.
B)   people are willing to buy less of the good than before at each possible price.
C)   people's incomes must have decreased.
D)   the price of the product has increased, causing consumers to buy less of the product.E) A) and D)
F) A) and C)

Question 18

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

Question 19

The supply of a good or service is determined by

Accepted Answer

A)   those who buy the good or service.
B)   the government.
C)   those who sell the good or service.
D)   both those who buy and those who sell the good or service.E) C) and D)
F) A) and B)

Question 20

Which of the following is not a reason perfect competition is a useful simplification,despite the diversity of market types we find in the world?

Accepted Answer

A)   Perfectly competitive markets are the easiest to analyze because everyone participating in the market takes the price as given by market conditions.
B)   Some degree of competition is present in most markets.
C)   There are many buyers and many sellers in all types of markets.
D)   Many of the lessons that we learn by studying supply and demand under perfect competition apply in more complicated markets as well.E) None of the above
F) B) and D)

Exam 4: The Market Forces of Supply and Demand.

Correct Answer
verified

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

Correct Answer
verified

Figure 4-21 -Refer to Figure 4-21.Which of the following movements would illustrate the effect in the market for chocolate chip cookies of a decrease in the price of flour?

Correct Answer
verified

Once the supply curve for a product or service is drawn,it

Correct Answer
verified

Figure 4-6 -Refer to Figure 4-6.If the demand curve shifts from D to D',then

Correct Answer
verified

If car manufacturers begin using new labor-saving technology on their assembly lines,we would not expect

Correct Answer
verified

Which of the following events would unambiguously cause a decrease in the equilibrium price of cotton shirts?

Correct Answer
verified

The supply of a good or service is determined by

Correct Answer
verified

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 right.

Correct Answer
verified

A monopoly is a market with one

Correct Answer
verified

Figure 4-9 -Refer to Figure 4-9.The movement from point A to point B on the graph represents

Correct Answer
verified

Correct Answer
verified

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

Correct Answer
verified

If scientists discover that steamed milk,which is used to make lattés,prevents heart attacks,what would happen to the equilibrium price and quantity of lattés?

Correct Answer
verified

An increase in the price of oranges would lead to

Correct Answer
verified

A newspaper's classified ads are an example of a market.

Correct Answer
verified

An increase in the price of a good will

Correct Answer
verified

Which of the following is not a reason perfect competition is a useful simplification,despite the diversity of market types we find in the world?

Correct Answer
verified

Currently you purchase ten frozen pizza per month.You will graduate from college in December,and you will start a new job in January.You have no plans to purchase frozen pizzas in January.For you,frozen pizzas are a(n)

Correct Answer
verified

Suppose scientists provide evidence that chocolate pudding increases the bad cholesterol levels of those who eat it.We would expect to see

Correct Answer
verified

Exam 4: The Market Forces of Supply and Demand.

Correct AnswerverifiedShow Answer

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

Figure 4-21 -Refer to Figure 4-21.Which of the following movements would illustrate the effect in the market for chocolate chip cookies of a decrease in the price of flour?

Correct AnswerverifiedShow Answer

Once the supply curve for a product or service is drawn,it

Correct AnswerverifiedShow Answer

Figure 4-6 -Refer to Figure 4-6.If the demand curve shifts from D to D',then

Correct AnswerverifiedShow Answer

If car manufacturers begin using new labor-saving technology on their assembly lines,we would not expect

Correct AnswerverifiedShow Answer

Which of the following events would unambiguously cause a decrease in the equilibrium price of cotton shirts?

Correct AnswerverifiedShow Answer

The supply of a good or service is determined by

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 right.

Correct AnswerverifiedShow Answer

A monopoly is a market with one

Correct AnswerverifiedShow Answer

Figure 4-9 -Refer to Figure 4-9.The movement from point A to point B on the graph represents

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

If scientists discover that steamed milk,which is used to make lattés,prevents heart attacks,what would happen to the equilibrium price and quantity of lattés?

Correct AnswerverifiedShow Answer

An increase in the price of oranges would lead to

Correct AnswerverifiedShow Answer

A newspaper's classified ads are an example of a market.

Correct AnswerverifiedShow Answer

An increase in the price of a good will

Correct AnswerverifiedShow Answer

Which of the following is not a reason perfect competition is a useful simplification,despite the diversity of market types we find in the world?

Correct AnswerverifiedShow Answer

Currently you purchase ten frozen pizza per month.You will graduate from college in December,and you will start a new job in January.You have no plans to purchase frozen pizzas in January.For you,frozen pizzas are a(n)

Correct AnswerverifiedShow Answer

Suppose scientists provide evidence that chocolate pudding increases the bad cholesterol levels of those who eat it.We would expect to see

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified