Question 1

A movement upward and to the left along a demand curve is called an)

Accepted Answer

A)   increase in demand.
B)   decrease in demand.
C)   decrease in quantity demanded.
D)   increase in quantity demanded.E) B) and D)
F) A) and B)

Question 2

What would happen to the equilibrium price and quantity of peanut butter if the price of peanuts went up, the price of jelly fell, fewer firms decided to produce peanut butter, and health officials announced that eating peanut butter was good for you?

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) A) and B)
F) A) and C)

Question 3

Figure 4-12
Firm A Firm B
  
-Refer to Figure 4-12. If these are the only two sellers in the market, then the market quantity supplied at a price of $4 is

Accepted Answer

A)   6 units.
B)   7 units.
C)   8 units.
D)   14 units.E) A) and B)
F) A) and C)

Question 4

Figure 4-27
Panel a)  Panel b) 
   Panel c)  Panel d) 
  
-Refer to Figure 4-27. Which of the four panels illustrates an increase in quantity demanded?

Accepted Answer

A)   Panel a) 
B)   Panel b) 
C)   Panel c) 
D)   Panel d) E) A) and B)
F) All of the above

Question 5

A rightward shift of a demand curve is called an)

Accepted Answer

A)   increase in demand.
B)   decrease in demand.
C)   decrease in quantity demanded.
D)   increase in quantity demanded.E) None of the above
F) A) and C)

Question 6

A decrease in the price of pizza will shift the supply curve for pizza to the left.

Accepted Answer

A) True 
 B)False

Question 7

When the price of a good is high, selling the good is profitable, and so the quantity supplied is large.

Accepted Answer

A) True 
 B)False

Question 8

What would happen to the equilibrium price and quantity of coffee if the wages of coffee-bean pickers fell and the price of tea fell?

Accepted Answer

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

Question 9

Suppose there are six bait and tackle shops that sell worms in a lakeside resort town in Minnesota. If we add the respective quantities that each shop would produce and sell at each of the six bait and tackle shops when the price of worms is $2 per bucket, $2.50 per bucket, and $3 per bucket, and so forth, we have found the

Accepted Answer

A)   market demand curve.
B)   market supply curve.
C)   equilibrium curve.
D)   surplus or shortage depending on market conditions.E) B) and D)
F) None of the above

Question 10

Which of the following changes would not shift the supply curve for a good or service?

Accepted Answer

A)   a change in production technology
B)   a change in the price of the good or service
C)   a change in expectations about the future price of the good or service
D)   a change in input pricesE) A) and C)
F) None of the above

Question 11

Table 4-16
The following table shows the supply and demand schedules in a market.
 
-Refer to Table 4-16. What is the equilibrium quantity in this market?

Accepted Answer

The answer of Table 4-16
The following table shows the supply...

Question 12

When all market participants are price takers who have no influence over prices, the markets have

Accepted Answer

A)   only a few buyers and sellers.
B)   numerous sellers but only a few buyers.
C)   numerous buyers but only a few sellers.
D)   numerous buyers and sellers.E) C) and D)
F) A) and D)

Question 13

Consider the market for portable air conditioners in equilibrium. A summer of unseasonably cool weather would cause

Accepted Answer

A)   both the equilibrium price and quantity to decrease.
B)   both the equilibrium price and quantity to increase.
C)   the equilibrium price to increase and the equilibrium quantity to decrease.
D)   the equilibrium price to decrease and the equilibrium quantity to increase.E) All of the above
F) B) and C)

Question 14

Figure 4-3
Consumer 1 Consumer 2
  
-Refer to Figure 4-3. If these are the only two consumers in the market, then the market quantity demanded at a price of $6 is

Accepted Answer

A)   12 units.
B)   14 units.
C)   19 units.
D)   21 units.E) A) and C)
F) B) and C)

Question 15

A movement upward and to the right along a supply curve is called an)

Accepted Answer

A)   increase in supply.
B)   decrease in supply.
C)   decrease in quantity supplied.
D)   increase in quantity supplied.E) A) and B)
F) A) and D)

Question 16

A movement downward and to the right along a demand curve is called an)

Accepted Answer

A)   increase in demand.
B)   decrease in demand.
C)   decrease in quantity demanded.
D)   increase in quantity demanded.E) B) and C)
F) A) and D)

Question 17

Assume Leo buys coffee beans in a competitive market. It follows that

Accepted Answer

A)   Leo has a limited number of sellers from which to buy coffee beans.
B)   Leo will negotiate with sellers whenever he buys coffee beans.
C)   Leo cannot influence the price of coffee beans even if he buys a large quantity of them.
D)   None of the above is correct.E) A) and D)
F) All of the above

Question 18

Advances in production technology typically reduce firms' costs.

Accepted Answer

A) True 
 B)False

Question 19

Figure 4-17 
-Refer to Figure 4-17. At a price of

Accepted Answer

A)   $8, there is a surplus of 6 units.
B)   $5, there is neither a shortage nor a surplus.
C)   $2, there is a shortage of 6 units.
D)   All of the above are correct.E) A) and B)
F) C) and D)

Question 20

If baked potatoes and sour cream are complements, then an increase in the price of sour cream decreases the demand for baked potatoes.

Accepted Answer

A) True 
 B)False

Exam 4: The Market Forces of Supply and Demand

When all market participants are price takers who have no influence over prices, the markets have

Correct Answer
verified

A rightward shift of a demand curve is called an)

Correct Answer
verified

What would happen to the equilibrium price and quantity of coffee if the wages of coffee-bean pickers fell and the price of tea fell?

Correct Answer
verified

Advances in production technology typically reduce firms' costs.

Correct Answer
verified

A movement upward and to the right along a supply curve is called an)

Correct Answer
verified

Consider the market for portable air conditioners in equilibrium. A summer of unseasonably cool weather would cause

Correct Answer
verified

If baked potatoes and sour cream are complements, then an increase in the price of sour cream decreases the demand for baked potatoes.

Correct Answer
verified

When the price of a good is high, selling the good is profitable, and so the quantity supplied is large.

Correct Answer
verified

Figure 4-12 Firm A Firm B -Refer to Figure 4-12. If these are the only two sellers in the market, then the market quantity supplied at a price of $4 is

Correct Answer
verified

A movement upward and to the left along a demand curve is called an)

Correct Answer
verified

What would happen to the equilibrium price and quantity of peanut butter if the price of peanuts went up, the price of jelly fell, fewer firms decided to produce peanut butter, and health officials announced that eating peanut butter was good for you?

Correct Answer
verified

Figure 4-3 Consumer 1 Consumer 2 -Refer to Figure 4-3. If these are the only two consumers in the market, then the market quantity demanded at a price of $6 is

Correct Answer
verified

Figure 4-27 Panel a) Panel b) Panel c) Panel d) -Refer to Figure 4-27. Which of the four panels illustrates an increase in quantity demanded?

Correct Answer
verified

Which of the following changes would not shift the supply curve for a good or service?

Correct Answer
verified

A decrease in the price of pizza will shift the supply curve for pizza to the left.

Correct Answer
verified

Assume Leo buys coffee beans in a competitive market. It follows that

Correct Answer
verified

Figure 4-17 -Refer to Figure 4-17. At a price of

Correct Answer
verified

Table 4-16 The following table shows the supply and demand schedules in a market. -Refer to Table 4-16. What is the equilibrium quantity in this market?

Correct Answer
verified

Correct Answer
verified

A movement downward and to the right along a demand curve is called an)

Correct Answer
verified

Exam 4: The Market Forces of Supply and Demand

When all market participants are price takers who have no influence over prices, the markets have

Correct AnswerverifiedShow Answer

A rightward shift of a demand curve is called an)

Correct AnswerverifiedShow Answer

What would happen to the equilibrium price and quantity of coffee if the wages of coffee-bean pickers fell and the price of tea fell?

Correct AnswerverifiedShow Answer

Advances in production technology typically reduce firms' costs.

Correct AnswerverifiedShow Answer

A movement upward and to the right along a supply curve is called an)

Correct AnswerverifiedShow Answer

Consider the market for portable air conditioners in equilibrium. A summer of unseasonably cool weather would cause

Correct AnswerverifiedShow Answer

If baked potatoes and sour cream are complements, then an increase in the price of sour cream decreases the demand for baked potatoes.

Correct AnswerverifiedShow Answer

When the price of a good is high, selling the good is profitable, and so the quantity supplied is large.

Correct AnswerverifiedShow Answer

Figure 4-12 Firm A Firm B -Refer to Figure 4-12. If these are the only two sellers in the market, then the market quantity supplied at a price of $4 is

Correct AnswerverifiedShow Answer

A movement upward and to the left along a demand curve is called an)

Correct AnswerverifiedShow Answer

What would happen to the equilibrium price and quantity of peanut butter if the price of peanuts went up, the price of jelly fell, fewer firms decided to produce peanut butter, and health officials announced that eating peanut butter was good for you?

Correct AnswerverifiedShow Answer

Figure 4-3 Consumer 1 Consumer 2 -Refer to Figure 4-3. If these are the only two consumers in the market, then the market quantity demanded at a price of $6 is

Correct AnswerverifiedShow Answer

Figure 4-27 Panel a) Panel b) Panel c) Panel d) -Refer to Figure 4-27. Which of the four panels illustrates an increase in quantity demanded?

Correct AnswerverifiedShow Answer

Which of the following changes would not shift the supply curve for a good or service?

Correct AnswerverifiedShow Answer

A decrease in the price of pizza will shift the supply curve for pizza to the left.

Correct AnswerverifiedShow Answer

Assume Leo buys coffee beans in a competitive market. It follows that

Correct AnswerverifiedShow Answer

Figure 4-17 -Refer to Figure 4-17. At a price of

Correct AnswerverifiedShow Answer

Table 4-16 The following table shows the supply and demand schedules in a market. -Refer to Table 4-16. What is the equilibrium quantity in this market?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A movement downward and to the right along a demand curve is called an)

Correct AnswerverifiedShow Answer

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