Question 1

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 2

Holding all other things constant, a higher price for ski lift tickets would

Accepted Answer

A)  increase the number of skiers.
B)  increase the price of skis.
C)  decrease the number of skis sold.
D)  decrease the demand for other winter recreational activities.E) A) and C)
F) All of the above

Question 3

Table 4-6
   An Ineatse in Supply  A Decrense in Supply  An Inerease in Denend  A B A Decrense in Denand  C  D \begin{array} { | c | c | c | } \hline & 	ext { An Ineatse in Supply } & 	ext { A Decrense in Supply } \\hline 	ext { An Inerease in Denend } & 	ext { A } & \mathbf { B } \\hline 	ext { A Decrense in Denand } & 	ext { C } & 	ext { D } \\hline\end{array} An Inerease in Denend  A Decrense in Denand ​ An Ineatse in Supply  A  C ​ A Decrense in Supply B D ​​ 
-Refer to Table 4-6. Which combination would produce a decrease in equilibrium quantity and an indeterminate change in equilibrium price?

Accepted Answer

A)  A
B)  B
C)  C
D)  D E) A) and D)
F) All of the above

Question 4

If consumers often purchase muffins to eat while they drink their lattés at local coffee shops, what would happen to the equilibrium price and quantity of lattés if the price of muffins falls?

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) All of the above
F) None of the above

Question 5

Figure 4-3
 
-Refer to Figure 4-3. If these are the only two consumers in the market, then the market quantity demanded at a price of $15 is

Accepted Answer

A)  0 units.
B)  10 units.
C)  15 units.
D)  25 units.E) C) and D)
F) B) and D)

Question 6

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

Accepted Answer

A) True 
 B)False

Question 7

When quantity demanded exceeds quantity supplied at the current market price, the market has a shortage, and market price will likely rise in the future to eliminate the shortage.

Accepted Answer

A) True 
 B)False

Question 8

Two goods are substitutes when a decrease in the price of one good

Accepted Answer

A)  decreases the demand for the other good.
B)  decreases the quantity demanded of the other good.
C)  increases the demand for the other good.
D)  increases the quantity demanded of the other good.E) C) and D)
F) A) and B)

Question 9

A market is a group of buyers and sellers of a particular good or service.

Accepted Answer

A) True 
 B)False

Question 10

If there is an improvement in the technology used to produce a good, then the supply curve for that good will shift to the left.

Accepted Answer

A) True 
 B)False

Question 11

"Other things equal, when the price of a good rises, the quantity demanded of the good falls, and when the price falls, the quantity demanded rises." This relationship between price and quantity demanded is referred to as

Accepted Answer

A)  equilibrium.
B)  the law of demand.
C)  the relationship between supply and demand.
D)  the definition of an inferior good.E) B) and D)
F) All of the above

Question 12

A improvement in production technology will shift the

Accepted Answer

A)  supply curve to the right.
B)  supply curve to the left.
C)  demand curve to the right.
D)  demand curve to the left.E) A) and C)
F) B) and C)

Question 13

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) A) and B)
F) A) and D)

Question 14

Figure 4-16 
-Refer to Figure 4-16. If price in this market is currently $14, then there would be a(n)

Accepted Answer

A)  surplus of 20 units. The law of supply and demand predicts that the price will rise from $14 to a higher price.
B)  excess supply of 20 units. The law of supply and demand predicts that the price will fall from $14 to a lower price.
C)  surplus of 40 units. The law of supply and demand predicts that the price will rise from $14 to a higher price.
D)  excess supply of 40 units. The law of supply and demand predicts that the price will fall from $14 to a lower price.E) A) and D)
F) B) and D)

Question 15

When a seller expects the price of its product to decrease in the future, the seller's supply curve shifts left now.

Accepted Answer

A) True 
 B)False

Question 16

Equilibrium quantity must increase when demand

Accepted Answer

A)  increases and supply does not change, when demand does not change and supply increases, and when both demand and supply increase.
B)  increases and supply does not change, when demand does not change and supply increases, and when both demand and supply decrease.
C)  decreases and supply does not change, when demand does not change and supply decreases, and when both demand and supply increase.
D)  decreases and supply does not change, when demand does not change and supply decreases, and when both demand and supply decrease.E) B) and C)
F) B) and D)

Question 17

Figure 4-13 
-Refer to Figure 4-13. The shift from S to S' in the market for peaches could be caused by a(n)

Accepted Answer

A)  increase in the price of peaches.
B)  decrease in the price of pears.
C)  increase in income.
D)  decrease in the labor costs of the workers who pick peaches.E) None of the above
F) A) and C)

Question 18

The market demand curve shows how the total quantity demanded of a good varies as the income of buyers varies, while all the other factors that affect how much consumers want to buy are held constant.

Accepted Answer

A) True 
 B)False

Question 19

Two goods are complements when a decrease in the price of one good

Accepted Answer

A)  decreases the quantity demanded of the other good.
B)  decreases the demand for the other good.
C)  increases the quantity demanded of the other good.
D)  increases the demand for the other good.E) A) and B)
F) A) and C)

Question 20

Figure 4-14 
-Refer to Figure 4-14. At a price of

Accepted Answer

A)  $2, there is a surplus of 6 units.
B)  $5, there is a surplus of 25 units.
C)  $5, there is a shortage of $25.
D)  $7, there is a surplus of 4 units.E) A) and D)
F) A) and C)

Exam 4: The Market Forces of Supply and Demand

Figure 4-3 -Refer to Figure 4-3. If these are the only two consumers in the market, then the market quantity demanded at a price of $15 is

Correct Answer
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Correct Answer
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When quantity demanded exceeds quantity supplied at the current market price, the market has a shortage, and market price will likely rise in the future to eliminate the shortage.

Correct Answer
verified

Equilibrium quantity must increase when demand

Correct Answer
verified

A monopoly is a market with one

Correct Answer
verified

The market demand curve shows how the total quantity demanded of a good varies as the income of buyers varies, while all the other factors that affect how much consumers want to buy are held constant.

Correct Answer
verified

Two goods are substitutes when a decrease in the price of one good

Correct Answer
verified

Two goods are complements when a decrease in the price of one good

Correct Answer
verified

If consumers often purchase muffins to eat while they drink their lattés at local coffee shops, what would happen to the equilibrium price and quantity of lattés if the price of muffins falls?

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

Correct Answer
verified

Figure 4-13 -Refer to Figure 4-13. The shift from S to S' in the market for peaches could be caused by a(n)

Correct Answer
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Figure 4-14 -Refer to Figure 4-14. At a price of

Correct Answer
verified

If there is an improvement in the technology used to produce a good, then the supply curve for that good will shift to the left.

Correct Answer
verified

"Other things equal, when the price of a good rises, the quantity demanded of the good falls, and when the price falls, the quantity demanded rises." This relationship between price and quantity demanded is referred to as

Correct Answer
verified

A improvement in production technology will shift the

Correct Answer
verified

When a seller expects the price of its product to decrease in the future, the seller's supply curve shifts left now.

Correct Answer
verified

Holding all other things constant, a higher price for ski lift tickets would

Correct Answer
verified

Figure 4-16 -Refer to Figure 4-16. If price in this market is currently $14, then there would be a(n)

Correct Answer
verified

A market is a group of buyers and sellers of a particular good or service.

Correct Answer
verified

Exam 4: The Market Forces of Supply and Demand

Figure 4-3 -Refer to Figure 4-3. If these are the only two consumers in the market, then the market quantity demanded at a price of $15 is

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

When quantity demanded exceeds quantity supplied at the current market price, the market has a shortage, and market price will likely rise in the future to eliminate the shortage.

Correct AnswerverifiedShow Answer

Equilibrium quantity must increase when demand

Correct AnswerverifiedShow Answer

A monopoly is a market with one

Correct AnswerverifiedShow Answer

The market demand curve shows how the total quantity demanded of a good varies as the income of buyers varies, while all the other factors that affect how much consumers want to buy are held constant.

Correct AnswerverifiedShow Answer

Two goods are substitutes when a decrease in the price of one good

Correct AnswerverifiedShow Answer

Two goods are complements when a decrease in the price of one good

Correct AnswerverifiedShow Answer

If consumers often purchase muffins to eat while they drink their lattés at local coffee shops, what would happen to the equilibrium price and quantity of lattés if the price of muffins falls?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Figure 4-13 -Refer to Figure 4-13. The shift from S to S' in the market for peaches could be caused by a(n)

Correct AnswerverifiedShow Answer

Figure 4-14 -Refer to Figure 4-14. At a price of

Correct AnswerverifiedShow Answer

If there is an improvement in the technology used to produce a good, then the supply curve for that good will shift to the left.

Correct AnswerverifiedShow Answer

"Other things equal, when the price of a good rises, the quantity demanded of the good falls, and when the price falls, the quantity demanded rises." This relationship between price and quantity demanded is referred to as

Correct AnswerverifiedShow Answer

A improvement in production technology will shift the

Correct AnswerverifiedShow Answer

When a seller expects the price of its product to decrease in the future, the seller's supply curve shifts left now.

Correct AnswerverifiedShow Answer

Holding all other things constant, a higher price for ski lift tickets would

Correct AnswerverifiedShow Answer

Figure 4-16 -Refer to Figure 4-16. If price in this market is currently $14, then there would be a(n)

Correct AnswerverifiedShow Answer

A market is a group of buyers and sellers of a particular good or service.

Correct AnswerverifiedShow Answer

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