Question 1

The following table contains a demand schedule for a good.  If the law of demand applies to this good, then Q1 could be

Accepted Answer

A)   0.
B)   100.
C)   200.
D)   400.E) A) and B)
F) C) and D)

Question 2

Figure 4-18 
-Refer to Figure 4-18. At a price of $35, there would be

Accepted Answer

A)   a shortage, and the price would tend to rise from $35 to a higher price.
B)   a surplus, and the price would tend to rise from $35 to a higher price.
C)   excess demand, and the price would tend to fall from $35 to a lower price.
D)   excess supply, and the price would tend to fall from $35 to a lower price.E) A) and B)
F) B) and C)

Question 3

Suppose scientists provide evidence that people who drink energy drinks are more likely to have a heart attack than people who do not drink energy drinks. We would expect to see

Accepted Answer

A)   no change in the demand for energy drinks.
B)   a decrease in the demand for energy drinks.
C)   an increase in the demand for energy drinks.
D)   a decrease in the supply of energy drinks.E) B) and C)
F) A) and D)

Question 4

Figure 4-25
The graph below pertains to the supply of paper to colleges and universities. 
-Refer to Figure 4-25. All else equal, a major paper manufacturer filing for bankruptcy and shutting down as a result of an IRS tax evasion investigation would cause a move from

Accepted Answer

A)   x to y.
B)   y to x.
C)   SA to SB.
D)   SB to SA.E) A) and C)
F) None of the above

Question 5

If a decrease in income increases the demand for a good, then the good is a(n)

Accepted Answer

A)   substitute good.
B)   complementary good.
C)   normal good.
D)   inferior good.E) None of the above
F) B) and D)

Question 6

Figure 4-18 
-Refer to Figure 4-18. At the equilibrium price,

Accepted Answer

A)   200 units would be supplied and demanded.
B)   400 units would be supplied and demanded.
C)   600 units would be supplied and demanded.
D)   600 units would be supplied, but only 200 would be demanded.E) A) and D)
F) B) and C)

Question 7

An increase in the price of a good would

Accepted Answer

A)   increase the supply of the good.
B)   increase the amount purchased by buyers.
C)   give producers an incentive to produce more.
D)   decrease both the quantity demanded of the good and the quantity supplied of the good.E) B) and C)
F) C) and D)

Question 8

Figure 4-23 
-Refer to Figure 4-23. In this market for sunscreen, there is a decrease in the price of zinc oxide, an input into sunscreen, and more producers enter the market. The equilibrium price

Accepted Answer

A)   increases and the equilibrium quantity decreases.
B)   decreases and the equilibrium quantity increases.
C)   is ambiguous and the equilibrium quantity increases.
D)   decreases and the equilibrium quantity is ambiguous.E) None of the above
F) B) and C)

Question 9

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

Accepted Answer

A)   Panel (a) 
B)   Panel (b) 
C)   Panel (c) 
D)   Panel (d) E) C) and D)
F) B) and D) D

Question 10

Figure 4-31
Consider the market for 2-packs of light bulbs below. 
-Refer to Figure 4-31. What are the values of the equilibrium price and quantity?

Accepted Answer

The answer of Figure 4-31
Consider the market for 2-packs of...

Question 11

Figure 4-22 
-Refer to Figure 4-22. What is the equilibrium quantity in this market?

Accepted Answer

A)   4 units
B)   8 units
C)   12 units
D)   16 unitsE) A) and B)
F) C) and D)

Question 12

A likely example of substitute goods for most people would be

Accepted Answer

A)   peanut butter and jelly.
B)   tennis balls and tennis rackets.
C)   televisions and subscriptions to cable television services.
D)   pencils and pens.E) All of the above
F) A) and B) D

Question 13

A rightward shift of a demand curve is called a(n)

Accepted Answer

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

Question 14

The sum of all the individual supply curves for a product is called

Accepted Answer

A)   total supply.
B)   market supply.
C)   aggregate supply.
D)   total output.E) A) and B)
F) All of the above

Question 15

Table 4-3 
-Refer to Table 4-3. If these are the only four buyers in the market, then the market quantity demanded at a price of $1 is

Accepted Answer

A)   4 units.
B)   7.75 units.
C)   14 units.
D)   31 units.E) C) and D)
F) B) and D)

Question 16

Figure 4-7 
-Refer to Figure 4-7. If the demand curve for Good X shifts from Db to Da, then

Accepted Answer

A)   firms would be willing to supply more of Good X than before at each possible price.
B)   people are willing to buy less of Good X than before at each possible price.
C)   people's incomes must have increased.
D)   the price of Good X has increased.E) All of the above
F) None of the above

Question 17

If Kindle e-readers and Nook e-readers are substitutes, a higher price for Nooks would result in a(n)

Accepted Answer

A)   increase in the demand for Nooks.
B)   decrease in the demand for Nooks.
C)   increase in the demand for Kindles.
D)   decrease in the demand for Kindles.E) A) and B)
F) C) and D)

Question 18

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

Question 19

Cocoa and marshmallows are complements, so a decrease in the price of cocoa will cause an increase in the demand for marshmallows.

Accepted Answer

A) True 
 B)False  True

Question 20

If muffins and bagels are substitutes, a higher price for bagels would result in a(n)

Accepted Answer

A)   increase in the demand for bagels.
B)   decrease in the demand for bagels.
C)   increase in the demand for muffins.
D)   decrease in the demand for muffins.E) B) and C)
F) B) and D)

Exam 4: The Market Forces of Supply and Demand

The following table contains a demand schedule for a good. If the law of demand applies to this good, then Q1 could be

Correct AnswerverifiedShow Answer

Figure 4-18 -Refer to Figure 4-18. At a price of $35, there would be

Correct AnswerverifiedShow Answer

Suppose scientists provide evidence that people who drink energy drinks are more likely to have a heart attack than people who do not drink energy drinks. We would expect to see

Correct AnswerverifiedShow Answer

Figure 4-25 The graph below pertains to the supply of paper to colleges and universities. -Refer to Figure 4-25. All else equal, a major paper manufacturer filing for bankruptcy and shutting down as a result of an IRS tax evasion investigation would cause a move from

Correct AnswerverifiedShow Answer

If a decrease in income increases the demand for a good, then the good is a(n)

Correct AnswerverifiedShow Answer

Figure 4-18 -Refer to Figure 4-18. At the equilibrium price,

Correct AnswerverifiedShow Answer

An increase in the price of a good would

Correct AnswerverifiedShow Answer

Figure 4-23 -Refer to Figure 4-23. In this market for sunscreen, there is a decrease in the price of zinc oxide, an input into sunscreen, and more producers enter the market. The equilibrium price

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 a decrease in quantity demanded?

Correct AnswerverifiedD

Figure 4-31 Consider the market for 2-packs of light bulbs below. -Refer to Figure 4-31. What are the values of the equilibrium price and quantity?

Correct AnswerverifiedShow Answer

Figure 4-22 -Refer to Figure 4-22. What is the equilibrium quantity in this market?

Correct AnswerverifiedShow Answer

A likely example of substitute goods for most people would be

Correct AnswerverifiedD

A rightward shift of a demand curve is called a(n)

Correct AnswerverifiedShow Answer

The sum of all the individual supply curves for a product is called

Correct AnswerverifiedShow Answer

Table 4-3 -Refer to Table 4-3. If these are the only four buyers in the market, then the market quantity demanded at a price of $1 is

Correct AnswerverifiedShow Answer

Figure 4-7 -Refer to Figure 4-7. If the demand curve for Good X shifts from Db to Da, then

Correct AnswerverifiedShow Answer

If Kindle e-readers and Nook e-readers are substitutes, a higher price for Nooks would result in a(n)

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Cocoa and marshmallows are complements, so a decrease in the price of cocoa will cause an increase in the demand for marshmallows.

Correct AnswerverifiedTrue

If muffins and bagels are substitutes, a higher price for bagels would result in a(n)

Correct AnswerverifiedShow Answer

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D

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