Question 1

Use the supply and demand model to explain what happens to the equilibrium price and the equilibrium quantity for pasta in the following cases:
 (A) There is a lare expansion in the nunber of firm producing pasta.
(B) It is witely publicized in the press that pasta i5n't as healthful as previdusly thaught.
(C) There is a sudiden increase in the price of paste flour, which is used to produce paste.
(D) Pasta suddenly becames papular because amavie idol pramates it in televisian commercials.

Accepted Answer

(A) Supply shift right increasing the eq...

Question 2

A shortage occurs when quantity demanded exceeds quantity supplied.

Accepted Answer

A) True 
 B)False

Question 3

Why does supply slope upward?

Accepted Answer

As more of a good is produced, per-unit ...

Question 4

Draw a supply and demand diagram with supply and demand both increasing and market equilibrium price increasing as well.

Accepted Answer

The answer of Draw a supply and demand diagram with...

Question 5

When economists say that the demand for a product has decreased, they mean that

Accepted Answer

A)   a greater quantity will be produced at any price.
B)   the price is too high for equilibrium.
C)   a smaller quantity will be produced at any price.
D)   demand was too high for producers to make a profit.
E)   the price is too low for equilibrium.F) C) and D)
G) A) and D)

Question 6

Other things being equal, the quantity supplied decreases as price increases.

Accepted Answer

A) True 
 B)False

Question 7

Exhibit 3-1   Price  Quantity Demanded  Quantity Supplied $11,0001002900350350050043001,00051001,200\begin{array} { | c | c | c | } \hline 	ext { Price } & 	ext { Quantity Demanded } & 	ext { Quantity Supplied } \\hline \$ 1 & 1,000 & 100 \\hline 2 & 900 & 350 \\hline 3 & 500 & 500 \\hline 4 & 300 & 1,000 \\hline 5 & 100 & 1,200 \\hline\end{array} Price $12345​ Quantity Demanded 1,000900500300100​ Quantity Supplied 1003505001,0001,200​​ 
-Consider the market represented by the schedule in Exhibit 3-1. At a price of $2 per unit,

Accepted Answer

A)   the quantity purchased is 1,000 units.
B)   there will be a tendency for the price to decrease.
C)   there is a surplus of 300 units.
D)   the quantity sold is 350 units.
E)   the quantity purchased equals the quantity sold. F) C) and E)
G) A) and B)

Question 8

Exhibit 3-3 
-Refer to Exhibit 3-3. A shortage of ____ units will result in a price of ____.

Accepted Answer

A)   42; $9
B)   32; $18
C)   25; $27
D)   30; $27
E)   30; $9F) All of the above
G) C) and D)

Question 9

Why is the word equilibrium used to describe the price determined by supply and demand in a market?

Accepted Answer

Equilibrium is a general term ...

Question 10

Which of the following will not increase the demand for a good?

Accepted Answer

A)   An expectation of a decline in the product price in the future
B)   The product price falls, ceteris paribus.
C)   An increase in the price of a substitute
D)   A decrease in the price of a complement
E)   A foreign country opens its markets to imports from others.F) None of the above
G) All of the above

Question 11

Market equilibrium is determined by

Accepted Answer

A)   the producers in the market.
B)   the largest consumers in the market.
C)   all producers and consumers together.
D)   the consumers in the market.
E)   the largest firms in the market.F) D) and E)
G) C) and D)

Question 12

If the equilibrium quantity decreases while the equilibrium price increases, which of the following is the most likely reason?

Accepted Answer

A)   Supply increases while demand decreases.
B)   Supply increases while demand does not change.
C)   Both supply and demand increase.
D)   Both supply and demand decrease.
E)   Neither supply nor demand changes.F) A) and B)
G) A) and C)

Question 13

The supply curve slopes downward because sellers attempt to sell more when price drops.

Accepted Answer

A) True 
 B)False

Question 14

A change in the quantity supplied is reflected by a shift of the supply curve.

Accepted Answer

A) True 
 B)False

Question 15

The relationship between price and quantity demanded, other things being equal, is

Accepted Answer

A)   negative in some markets but positive in other markets.
B)   negative in markets without government intervention but positive in markets with government intervention.
C)   always negative in any market.
D)   positive in markets without government intervention but negative in markets with government intervention.
E)   always positive in any market.F) B) and D)
G) C) and E)

Question 16

The term quantity demanded refers to

Accepted Answer

A)   that point where the supply and demand curves cross.
B)   the amount of a good consumers are willing to buy at a given price.
C)   a particular demand schedule.
D)   the entire demand curve.
E)   the amount of a good people must forcibly demand from a producer in order to survive.F) A) and B)
G) C) and D)

Question 17

Which of the following leads to a leftward shift of the demand curve?

Accepted Answer

A)   An expectation of a decline in the product price in the future
B)   A decrease in the good's own price
C)   An increase in the price of a substitute
D)   A decrease in the price of a complement
E)   An increase in the number of consumersF) All of the above
G) B) and C)

Question 18

Which of the following will not cause the demand for ice cream to change?

Accepted Answer

A)   A change in population size
B)   A change in the price of ice cream
C)   A change in consumer incomes
D)   A change in the price of yogurt
E)   A change in seasonsF) C) and D)
G) A) and E)

Question 19

What is the underlying cause of the law of supply?

Accepted Answer

The incentive to pro...

Question 20

If incomes increase, then the ____ in the market for luxury cars as normal goods ____.

Accepted Answer

A)   supply; decreases
B)   supply; increases
C)   demand; increases
D)   deman
E)   both supply and demanF) B) and E)
G) A) and E)

Exam 3: The Supply and Demand Model

Which of the following will not cause the demand for ice cream to change?

Correct Answer
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Draw a supply and demand diagram with supply and demand both increasing and market equilibrium price increasing as well.

Correct Answer
verified

What is the underlying cause of the law of supply?

Correct Answer
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The incentive to pro...
View Answer

The term quantity demanded refers to

Correct Answer
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Exhibit 3-3 -Refer to Exhibit 3-3. A shortage of units will result in a price of .

Correct Answer
verified

A shortage occurs when quantity demanded exceeds quantity supplied.

Correct Answer
verified

Why does supply slope upward?

Correct Answer
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As more of a good is produced, per-unit ...
View Answer

The supply curve slopes downward because sellers attempt to sell more when price drops.

Correct Answer
verified

The relationship between price and quantity demanded, other things being equal, is

Correct Answer
verified

Why is the word equilibrium used to describe the price determined by supply and demand in a market?

Correct Answer
verified
Equilibrium is a general term ...
View Answer

Which of the following leads to a leftward shift of the demand curve?

Correct Answer
verified

Correct Answer
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(A) Supply shift right increasing the eq...
View Answer

Correct Answer
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Other things being equal, the quantity supplied decreases as price increases.

Correct Answer
verified

If incomes increase, then the in the market for luxury cars as normal goods .

Correct Answer
verified

Market equilibrium is determined by

Correct Answer
verified

If the equilibrium quantity decreases while the equilibrium price increases, which of the following is the most likely reason?

Correct Answer
verified

A change in the quantity supplied is reflected by a shift of the supply curve.

Correct Answer
verified

Which of the following will not increase the demand for a good?

Correct Answer
verified

When economists say that the demand for a product has decreased, they mean that

Correct Answer
verified

Exam 3: The Supply and Demand Model

Which of the following will not cause the demand for ice cream to change?

Correct AnswerverifiedShow Answer

Draw a supply and demand diagram with supply and demand both increasing and market equilibrium price increasing as well.

Correct AnswerverifiedShow Answer

What is the underlying cause of the law of supply?

Correct AnswerverifiedThe incentive to pro...View AnswerShow Answer

The term quantity demanded refers to

Correct AnswerverifiedShow Answer

Exhibit 3-3 -Refer to Exhibit 3-3. A shortage of ____ units will result in a price of ____.

Correct AnswerverifiedShow Answer

A shortage occurs when quantity demanded exceeds quantity supplied.

Correct AnswerverifiedShow Answer

Why does supply slope upward?

Correct AnswerverifiedAs more of a good is produced, per-unit ...View AnswerShow Answer

The supply curve slopes downward because sellers attempt to sell more when price drops.

Correct AnswerverifiedShow Answer

The relationship between price and quantity demanded, other things being equal, is

Correct AnswerverifiedShow Answer

Why is the word equilibrium used to describe the price determined by supply and demand in a market?

Correct AnswerverifiedEquilibrium is a general term ...View AnswerShow Answer

Which of the following leads to a leftward shift of the demand curve?

Correct AnswerverifiedShow Answer

Correct Answerverified(A) Supply shift right increasing the eq...View AnswerShow Answer

Correct AnswerverifiedShow Answer

Other things being equal, the quantity supplied decreases as price increases.

Correct AnswerverifiedShow Answer

If incomes increase, then the ____ in the market for luxury cars as normal goods ____.

Correct AnswerverifiedShow Answer

Market equilibrium is determined by

Correct AnswerverifiedShow Answer

If the equilibrium quantity decreases while the equilibrium price increases, which of the following is the most likely reason?

Correct AnswerverifiedShow Answer

A change in the quantity supplied is reflected by a shift of the supply curve.

Correct AnswerverifiedShow Answer

Which of the following will not increase the demand for a good?

Correct AnswerverifiedShow Answer

When economists say that the demand for a product has decreased, they mean that

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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Correct Answer
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The incentive to pro...
View Answer

Correct Answer
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Exhibit 3-3 -Refer to Exhibit 3-3. A shortage of units will result in a price of .

Correct Answer
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Correct Answer
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Correct Answer
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As more of a good is produced, per-unit ...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Equilibrium is a general term ...
View Answer

Correct Answer
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Correct Answer
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(A) Supply shift right increasing the eq...
View Answer

Correct Answer
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Correct Answer
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If incomes increase, then the in the market for luxury cars as normal goods .

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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