Question 1

Which of the following decreases the demand for an inferior good?

Accepted Answer

A)   an increase in income
B)   a decrease in the price of a complement
C)   a decrease in income
D)   an increase in the price of a substituteE) A) and C)
F) A) and B)

Question 2

Ham and eggs are complements. If the price of ham rises, the demand for eggs will

Accepted Answer

A)   increase or decrease but the demand curve for ham will not change.
B)   decrease and the demand curve for ham will shift rightward.
C)   not change but there will be a movement along the demand curve for eggs.
D)   decrease and the demand curve for eggs will shift leftward.E) A) and D)
F) All of the above

Question 3

When the price of a pizza decreases from $12 to $10, it is definitely the case that the

Accepted Answer

A)   income effect means people buy less pizza.
B)   substitution effect means people buy more pizza.
C)   quantity demanded of pizza will not change.
D)   None of the above answers is correct.E) None of the above
F) B) and C)

Question 4

-The above table shows the demand schedule and supply schedule for chocolate chip cookies. What is the equilibrium quantity and equilibrium price for chocolate chip cookies?

Accepted Answer

A)   7 pounds, $3.00 per pound
B)   2 pounds, $3.00 per pound
C)   2 pounds, $6.00 per pound
D)   4 pounds, $5.00 per poundE) B) and C)
F) A) and D)

Question 5

Which of the following does NOT shift the demand curve for broccoli?

Accepted Answer

A)   an increase in the cost of fertilizer used to grow broccoli
B)   a warning by the U.S. Surgeon General that broccoli causes schizophrenia
C)   an increase in the price of spinach, a substitute for broccoli, because rodents gobbled up much of this year's spinach crop
D)   a decrease in the price of spinach, a substitute for broccoli, because of a bumper crop of spinach this yearE) B) and C)
F) A) and D)

Question 6

The equilibrium price will fall and the equilibrium quantity might increase, decrease, or stay the same when the

Accepted Answer

A)   demand and the supply of a good both increase.
B)   demand for a good increases and the supply of it decreases.
C)   demand for a good decreases and the supply of it increases.
D)   demand and the supply of a good both decrease.E) B) and D)
F) All of the above

Question 7

Changes in which of the following shifts the supply curve of hamburgers?

Accepted Answer

A)   a rise in the price of soda, a complement for hamburgers
B)   new research that establishes a link between hamburgers and heart problems
C)   an increase in the price of meat used to produce hamburgers
D)   an economy-wide decrease in income because of a long recessionE) All of the above
F) B) and C)

Question 8

The price of a gallon of milk falls. Which of the following is a possible cause?

Accepted Answer

A)   a decrease in the price of oatmeal, a complement to milk
B)   a discovery that milk cause diabetes
C)   Milk is a normal good and people's incomes rise.
D)   a drought that reduces supplies of feed grains fed to cows that produce milkE) B) and C)
F) B) and D)

Question 9

Scarcity guarantees that

Accepted Answer

A)   demands will exceed wants.
B)   wants will exceed demands.
C)   demands will be equal to wants.
D)   most demands will be satisfied.E) A) and B)
F) A) and C)

Question 10

If workers who make DVDs get a pay raise, the equilibrium price of a DVD ________ and the equilibrium quantity of DVDs ________.

Accepted Answer

A)   rises; increases
B)   rises; decreases
C)   falls; decreases
D)   falls; increasesE) All of the above
F) B) and C)

Question 11

Which of the following does NOT shift the supply curve?

Accepted Answer

A)   a technological advance
B)   a decrease in the wages of labor used in production of the good
C)   a fall in the price of a substitute in production
D)   an increase in the price of the goodE) C) and D)
F) All of the above

Question 12

-The above figures show the market for oranges. Which figure(s)  shows the effect of an increase in the price of bananas, a substitute for oranges?

Accepted Answer

A)   Figure A
B)   Figure C
C)   Figure D
D)   Figure A and CE) B) and C)
F) B) and D)

Question 13

-The above table gives the demand and supply schedules for Blu-ray discs. Based on the table, the equilibrium quantity and price of a Blu-ray discs is

Accepted Answer

A)   28,000 and $12.
B)   20,000 and $20.
C)   16,000 and $24.
D)   16,000 and $16.E) None of the above
F) A) and D)

Question 14

Suppose a market begins in equilibrium. If supply increases, then at the original equilibrium price the quantity demanded is

Accepted Answer

A)   is less than the quantity supplied and a surplus results.
B)   is less than the quantity supplied and a shortage results.
C)   exceeds the quantity supplied and a surplus results.
D)   exceeds the quantity supplied and a shortage results.E) A) and B)
F) A) and C)

Question 15

If there exists a shortage in the market for snowmobiles, then the price of a snowmobile will

Accepted Answer

A)   rise.
B)   fall.
C)   neither rise nor fall.
D)   at first fall then rise.E) B) and D)
F) B) and C)

Question 16

-The above table gives the demand and supply schedules for cat food. What is the equilibrium price and quantity?

Accepted Answer

The equilibrium price is $2.50...

Question 17

A shortage causes the

Accepted Answer

A)   demand curve to shift leftward.
B)   supply curve to shift rightward.
C)   price to fall.
D)   price to rise.E) B) and D)
F) None of the above

Question 18

In a supply and demand figure, the equilibrium price and quantity are found at the

Accepted Answer

A)   point where quantity supplied equals quantity demanded.
B)   horizontal intercept of the demand curve.
C)   vertical intercept of the supply curve.
D)   horizontal intercept of the supply and the demand curves.E) B) and D)
F) B) and C)

Question 19

The law of demand implies that, other things remaining the same

Accepted Answer

A)   as the price of a cheeseburger rises, the quantity of cheeseburgers demanded will increase.
B)   as the price of a cheeseburger rises, the quantity of cheeseburgers demanded will decrease.
C)   as income increases, the quantity of cheeseburgers demanded will increase.
D)   as the demand for cheeseburgers increases, the price of a cheeseburger will fall.E) None of the above
F) All of the above

Question 20

What happens to the demand for Xbox games if the price of an Xbox falls?

Accepted Answer

A)   The demand for Xboxes decreases because the price of a substitute falls.
B)   The demand for Xboxes increases because the price of a complement falls.
C)   The demand for Xboxes decreases because the price of a complement falls.
D)   The demand for Xboxes remains unchanged.E) B) and D)
F) None of the above

Exam 3: Demand and Supply

Ham and eggs are complements. If the price of ham rises, the demand for eggs will

Correct AnswerverifiedShow Answer

Which of the following decreases the demand for an inferior good?

Correct AnswerverifiedShow Answer

In a supply and demand figure, the equilibrium price and quantity are found at the

Correct AnswerverifiedShow Answer

Suppose a market begins in equilibrium. If supply increases, then at the original equilibrium price the quantity demanded is

Correct AnswerverifiedShow Answer

-The above table gives the demand and supply schedules for Blu-ray discs. Based on the table, the equilibrium quantity and price of a Blu-ray discs is

Correct AnswerverifiedShow Answer

What happens to the demand for Xbox games if the price of an Xbox falls?

Correct AnswerverifiedShow Answer

-The above table gives the demand and supply schedules for cat food. What is the equilibrium price and quantity?

Correct AnswerverifiedThe equilibrium price is $2.50...View AnswerShow Answer

Scarcity guarantees that

Correct AnswerverifiedShow Answer

When the price of a pizza decreases from $12 to $10, it is definitely the case that the

Correct AnswerverifiedShow Answer

The equilibrium price will fall and the equilibrium quantity might increase, decrease, or stay the same when the

Correct AnswerverifiedShow Answer

If workers who make DVDs get a pay raise, the equilibrium price of a DVD ________ and the equilibrium quantity of DVDs ________.

Correct AnswerverifiedShow Answer

-The above figures show the market for oranges. Which figure(s) shows the effect of an increase in the price of bananas, a substitute for oranges?

Correct AnswerverifiedShow Answer

A shortage causes the

Correct AnswerverifiedShow Answer

-The above table shows the demand schedule and supply schedule for chocolate chip cookies. What is the equilibrium quantity and equilibrium price for chocolate chip cookies?

Correct AnswerverifiedShow Answer

Which of the following does NOT shift the supply curve?

Correct AnswerverifiedShow Answer

Which of the following does NOT shift the demand curve for broccoli?

Correct AnswerverifiedShow Answer

Changes in which of the following shifts the supply curve of hamburgers?

Correct AnswerverifiedShow Answer

The law of demand implies that, other things remaining the same

Correct AnswerverifiedShow Answer

The price of a gallon of milk falls. Which of the following is a possible cause?

Correct AnswerverifiedShow Answer

If there exists a shortage in the market for snowmobiles, then the price of a snowmobile will

Correct AnswerverifiedShow Answer

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The equilibrium price is $2.50...
View Answer

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If workers who make DVDs get a pay raise, the equilibrium price of a DVD and the equilibrium quantity of DVDs .

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