Question 1

If technology increases then

Accepted Answer

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

Question 2

If you are grocery shopping and you see that the price of beef has risen and as a result you change your planned menu for the week and buy chicken instead, the reason your demand curve for beef is downward sloping has mostly to do with

Accepted Answer

A)  the substitution effect.
B)  the real-balances effect.
C)  diminishing marginal utility.D) B) and C)
E) All of the above

Question 3

If two goods are considered complements and the price of one decreases then the other good's

Accepted Answer

A)  demand curve will shift to the right.
B)  supply curve will shift to the right.
C)  demand curve will shift to the left.
D)  supply curve will shift to the left.E) None of the above
F) A) and B)

Question 4

-In Figure 2.1, Box 5 would be labeled

Accepted Answer

A)  P* for equilibrium price.
B)  P for price.
C)  S for supply.
D)  D for demand.E) C) and D)
F) None of the above

Question 5

An increase in the subsidy paid to producers of tobacco

Accepted Answer

A)  shifts the supply of tobacco to the right.
B)  shifts the demand for tobacco to the left.
C)  shifts the demand for tobacco to the right.
D)  shifts the market price of tobacco.E) None of the above
F) B) and D)

Question 6

If two goods are considered substitutes and the price of one decreases, the other good's

Accepted Answer

A)  demand curve will shift to the right.
B)  supply curve will shift to the right.
C)  demand curve will shift to the left.
D)  supply curve will shift to the left.E) All of the above
F) A) and C)

Question 7

If people consume fewer bottles of orange juice as their income rises, orange juice is

Accepted Answer

A)  a necessity.
B)  an abnormal good.
C)  a normal good.
D)  an inferior good.E) B) and C)
F) A) and B)

Question 8

The amount consumers are willing and able to buy at a particular price during a specified period of time is the

Accepted Answer

A)  demand.
B)  supply.
C)  quantity demanded.
D)  quantity supplied.E) B) and D)
F) B) and C)

Question 9

An increase in household income for a good that is considered inferior would

Accepted Answer

A)  move its demand curve to the right.
B)  move its demand curve to the left.
C)  cause a movement along the demand curve to a (higher price, lower quantity) point.
D)  cause a movement along the demand curve to a (lower price, higher quantity) point.E) B) and D)
F) B) and C)

Question 10

-In Figure 2.1, a "q/t" for quantity per unit time price would go in

Accepted Answer

A)  Box 1.
B)  Box 2.
C)  Box 4.
D)  Box 6.E) All of the above
F) A) and C)

Question 11

If a tax (paid by consumers) is levied on a good this would

Accepted Answer

A)  move its demand curve to the right.
B)  move its demand curve to the left.
C)  cause a movement along the demand curve to a (higher price, lower quantity) point.
D)  cause a movement along the demand curve to a (lower price, higher quantity) point.E) None of the above
F) A) and D)

Question 12

-From Table 2.1, which column is likely to be the one for quantity supplied?

Accepted Answer

A)  column A
B)  neither A nor B
C)  column B
D)  either A or B are equally likelyE) C) and D)
F) B) and D)

Question 13

If there is an expectation that the price of a good will increase in the next month this would immediately

Accepted Answer

A)  move its demand curve to the right.
B)  move its demand curve to the left.
C)  cause a movement along the demand curve to a (higher price, lower quantity) point.
D)  cause a movement along the demand curve to a (lower price, higher quantity) point.E) B) and D)
F) All of the above

Question 14

The substitution effect suggests that

Accepted Answer

A)  when prices are higher your buying power is less so you buy less.
B)  when prices are higher you buy less of what you originally wanted and use something else instead.
C)  when prices are higher buy fewer because the marginal utility of a good is diminishing.
D)  when prices are higher you buy more.E) A) and B)
F) B) and C)

Question 15

If demand increases and the price doesn't change, there will be a

Accepted Answer

A)  surplus.
B)  both a shortage and a surplus.
C)  shortage.
D)  neither a shortage nor a surplus.E) None of the above
F) C) and D)

Question 16

If the number of sellers increases, the

Accepted Answer

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

Question 17

The mechanism by which buyers and sellers negotiate an exchange is called a/an

Accepted Answer

A)  equilibrium.
B)  model.
C)  market.
D)  meeting.E) None of the above
F) A) and C)

Question 18

The amount of money that must be paid per unit of output is called the

Accepted Answer

A)  market.
B)  equilibrium.
C)  wage.
D)  price.E) None of the above
F) B) and C)

Question 19

The increase in technology used to produce a good would

Accepted Answer

A)  move its supply curve to the right.
B)  move its supply curve to the left.
C)  cause a movement along the supply curve to a (higher price, higher quantity) point.
D)  cause a movement along the supply curve to a (lower price, lower quantity) point.E) B) and C)
F) A) and B)

Question 20

The decrease in the price of a good that is another potential output for another good, would (for the second good)

Accepted Answer

A)  move its supply curve to the right.
B)  move its supply curve to the left.
C)  cause a movement along the supply curve to a (higher price, higher quantity) point.
D)  cause a movement along the supply curve to a (lower price, lower quantity) point.E) A) and B)
F) A) and C)

Exam 2: Supply and Demand

An increase in household income for a good that is considered inferior would

Correct AnswerverifiedShow Answer

If technology increases then

Correct AnswerverifiedShow Answer

The substitution effect suggests that

Correct AnswerverifiedShow Answer

If you are grocery shopping and you see that the price of beef has risen and as a result you change your planned menu for the week and buy chicken instead, the reason your demand curve for beef is downward sloping has mostly to do with

Correct AnswerverifiedShow Answer

If a tax (paid by consumers) is levied on a good this would

Correct AnswerverifiedShow Answer

If the number of sellers increases, the

Correct AnswerverifiedShow Answer

If two goods are considered substitutes and the price of one decreases, the other good's

Correct AnswerverifiedShow Answer

-In Figure 2.1, Box 5 would be labeled

Correct AnswerverifiedShow Answer

-From Table 2.1, which column is likely to be the one for quantity supplied?

Correct AnswerverifiedShow Answer

An increase in the subsidy paid to producers of tobacco

Correct AnswerverifiedShow Answer

If two goods are considered complements and the price of one decreases then the other good's

Correct AnswerverifiedShow Answer

The decrease in the price of a good that is another potential output for another good, would (for the second good)

Correct AnswerverifiedShow Answer

If demand increases and the price doesn't change, there will be a

Correct AnswerverifiedShow Answer

-In Figure 2.1, a "q/t" for quantity per unit time price would go in

Correct AnswerverifiedShow Answer

The amount consumers are willing and able to buy at a particular price during a specified period of time is the

Correct AnswerverifiedShow Answer

If there is an expectation that the price of a good will increase in the next month this would immediately

Correct AnswerverifiedShow Answer

If people consume fewer bottles of orange juice as their income rises, orange juice is

Correct AnswerverifiedShow Answer

The amount of money that must be paid per unit of output is called the

Correct AnswerverifiedShow Answer

The increase in technology used to produce a good would

Correct AnswerverifiedShow Answer

The mechanism by which buyers and sellers negotiate an exchange is called a/an

Correct AnswerverifiedShow Answer

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