Question 1

Which of the following is consistent with the law of demand?

Accepted Answer

A)   An increase in the price of a DVD causes an increase in the quantity of DVDs demanded.
B)   An increase in the price of a soda causes a decrease in the quantity of soda demanded.
C)   A decrease in the price of juice causes no change in the quantity of juice demanded.
D)   A decrease in the price of a gallon of milk causes a decrease in the quantity of milk demanded.E) B) and C)
F) None of the above

Question 2

Farmers can use their land to grow soy beans or corn. If the price of corn rises,

Accepted Answer

A)   the supply of soybeans increases.
B)   the supply of corn increases and the corn supply curve shifts rightward.
C)   the supply of corn increases.
D)   the supply of soybeans decreases and the soybean supply curve shifts leftward.E) A) and D)
F) A) and C)

Question 3

The demand curve for a normal good shifts leftward if income or the expected future price _ _.

Accepted Answer

A)   decreases; falls
B)   increases; falls
C)   increases; rises
D)   decreases; risesE) B) and D)
F) None of the above

Question 4

-The figure illustrates the market for pens. The equilibrium quantity is

Accepted Answer

A)   between 400 and 600 pens, but it is impossible to be precise.
B)   5 pens a month.
C)   500 pens a month.
D)   2 pens a month.E) C) and D)
F) A) and B)

Question 5

Which of the following shifts the demand curve for oranges?

Accepted Answer

A)   a decrease in the price of a pound of bananas, a substitute in consumption for oranges
B)   great weather that produces a bumper orange crop this year
C)   disastrous weather that destroys about half of this year's orange crop
D)   an increase in the price of the fuel used to transport oranges to supermarketsE) A) and C)
F) All of the above

Question 6

A shortage causes the

Accepted Answer

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

Question 7

A technological improvement lowers the cost of producing coffee. At the same time, consumers' preferences for coffee increase. The equilibrium price of coffee will

Accepted Answer

A)   rise.
B)   remain the same.
C)   fall.
D)   rise, fall, or stay the same, depending on the relative size of the shifts in the demand and supply curves.E) B) and C)
F) None of the above

Question 8

Pizza is a normal good. When the price of a pizza decreases from $14 to $12,

Accepted Answer

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

Question 9

The ABC Music club charges a price of $8 for a cassette and $16 for a CD. For an ABC Music Club member, the opportunity cost of a CD is

Accepted Answer

A)   1/2 a cassette.
B)   2 cassettes plus $16.
C)   2 cassettes.
D)   None of the above answers is correct.E) B) and C)
F) C) and D)

Question 10

List the factors change demand and shift the demand curve. Tell what happens to demand and the demand curve when there is an increase in the factor.

Accepted Answer

One factor that changes demand is a chan...

Question 11

-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) A) and C)
F) C) and D)

Question 12

Which of the following pairs of goods are most likely substitutes?

Accepted Answer

A)   DVDs and DVD players
B)   lettuce and salad dressing
C)   peanut butter and gasoline
D)   cola and lemon lime sodaE) All of the above
F) A) and B)

Question 13

1 to D2 and the supply curve shifts from S1 to S2. B)  demand curve shifts from D2 to D1 and the supply curve does not shift. C)  demand curve shifts from D2 to D1 and the supply curve shifts from S2 to S1. D)  demand curve does not shift, and the supply curve shifts from S1 to S2." class="answers-bank-image d-inline" rel="preload" >
-The figure above represents the market for candy. People become more concerned that eating candy causes them to gain weight, which they do not like. As a result, the

Accepted Answer

A)   demand curve shifts from D1 to D2 and the supply curve shifts from S1 to S2.
B)   demand curve shifts from D2 to D1 and the supply curve does not shift.
C)   demand curve shifts from D2 to D1 and the supply curve shifts from S2 to S1.
D)   demand curve does not shift, and the supply curve shifts from S1 to S2.E) All of the above
F) B) and C)

Question 14

When we say demand increases, we mean that there is a

Accepted Answer

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

Question 15

The Miami Dolphins play football in Joe Robbie Stadium which holds 76,500 seats. In 2007, attendance averaged about 70,000 fans per game. This means that the quantity supplied of seats is

Accepted Answer

A)   126,500.
B)   6,500.
C)   70,000.
D)   76,500.E) None of the above
F) A) and C)

Question 16

Which of the following would result in a movement along, but not a shift of the supply curve for spinach?

Accepted Answer

A)   Great weather that produces a bumper spinach crop this year.
B)   Disastrous weather that destroys half of this year's spinach crop.
C)   A rise in the price of of spinach.
D)   An increase in wages for workers in spinach fields.E) None of the above
F) B) and C)

Question 17

Suppose the equilibrium price of bottled water has risen from $1.00 per bottle to $2.00 per bottle and the equilibrium quantity has increased. These changes are a result of a shift of the
Curve for bottled water.

Accepted Answer

A)   rightward; supply
B)   leftward; supply
C)   rightward; demand
D)   leftward; demandE) None of the above
F) C) and D)

Question 18

After the sugar substitute saccharin was found to cause cancer in laboratory mice, its price dropped dramatically. This change in the price was because

Accepted Answer

A)   the government ordered the price reduction.
B)   the demand for saccharin decreased.
C)   saccharin producers felt sorry for their past customers and were making an honest attempt to compensate them.
D)   the supply of saccharin decreased.E) None of the above
F) B) and D)

Question 19

The "law of demand" most directly means that consumers buy

Accepted Answer

A)   less of a good the higher its price.
B)   more of a good the higher their incomes.
C)   buy less of a good the greater is its supply.
D)   buy more of a good the less is its supply.E) B) and D)
F) None of the above

Question 20

Which of the following will increase the quantity supplied of compact discs but NOT increase the supply of compact discs?

Accepted Answer

A)   a decrease in the price of a compact disc
B)   an increase in the price of the factors of production used to produce compact discs
C)   an increase in the price of a compact disc
D)   a decrease in the number of suppliers of compact discsE) B) and C)
F) A) and D)

Exam 3: Demand and Supply

A shortage causes the

Correct AnswerverifiedShow Answer

The Miami Dolphins play football in Joe Robbie Stadium which holds 76,500 seats. In 2007, attendance averaged about 70,000 fans per game. This means that the quantity supplied of seats is

Correct AnswerverifiedShow Answer

The ABC Music club charges a price of $8 for a cassette and $16 for a CD. For an ABC Music Club member, the opportunity cost of a CD is

Correct AnswerverifiedShow Answer

After the sugar substitute saccharin was found to cause cancer in laboratory mice, its price dropped dramatically. This change in the price was because

Correct AnswerverifiedShow Answer

Which of the following pairs of goods are most likely substitutes?

Correct AnswerverifiedShow Answer

Which of the following is consistent with the law of demand?

Correct AnswerverifiedShow Answer

Which of the following will increase the quantity supplied of compact discs but NOT increase the supply of compact discs?

Correct AnswerverifiedShow Answer

Suppose the equilibrium price of bottled water has risen from $1.00 per bottle to $2.00 per bottle and the equilibrium quantity has increased. These changes are a result of a shift of the Curve for bottled water.

Correct AnswerverifiedShow Answer

The "law of demand" most directly means that consumers buy

Correct AnswerverifiedShow Answer

Pizza is a normal good. When the price of a pizza decreases from $14 to $12,

Correct AnswerverifiedShow Answer

Farmers can use their land to grow soy beans or corn. If the price of corn rises,

Correct AnswerverifiedShow Answer

Which of the following shifts the demand curve for oranges?

Correct AnswerverifiedShow Answer

-The figure above represents the market for candy. People become more concerned that eating candy causes them to gain weight, which they do not like. As a result, the

Correct AnswerverifiedShow Answer

-The figure illustrates the market for pens. The equilibrium quantity is

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

When we say demand increases, we mean that there is a

Correct AnswerverifiedShow Answer

Which of the following would result in a movement along, but not a shift of the supply curve for spinach?

Correct AnswerverifiedShow Answer

The demand curve for a normal good shifts leftward if income or the expected future price _ _.

Correct AnswerverifiedShow Answer

List the factors change demand and shift the demand curve. Tell what happens to demand and the demand curve when there is an increase in the factor.

Correct AnswerverifiedOne factor that changes demand is a chan...View AnswerShow Answer

A technological improvement lowers the cost of producing coffee. At the same time, consumers' preferences for coffee increase. The equilibrium price of coffee will

Correct AnswerverifiedShow Answer

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One factor that changes demand is a chan...
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