Question 1

Suppose there is an increase in the price of steel. We would expect the supply curve for steel beams to

Accepted Answer

A)   shift rightward.
B)   shift leftward.
C)   become flatter.
D)   remain unchanged.E) A) and D)
F) A) and C)

Question 2

A decrease in the price of a product and an increase in the number of buyers in the market affect the demand curve in the same general way.

Accepted Answer

A) True 
 B)False

Question 3

Suppose there is a flood in St. Louis, Missouri, that destroys several beer bottling facilities. Which of the following would not be a direct result of this event?

Accepted Answer

A)   Sellers would not be able to produce and sell as much as before at each relevant price.
B)   The supply would decrease.
C)   Buyers would not be willing to buy as much as before at each relevant price.
D)   The equilibrium price would rise.E) A) and B)
F) B) and D)

Question 4

The equilibrium price is the same as the market-clearing price.

Accepted Answer

A) True 
 B)False

Question 5

Table 4-9
 
-Refer to Table 4-9. 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)   DE) A) and D)
F) B) and C)

Question 6

Which of the following is not held constant in a demand schedule?

Accepted Answer

A)   income
B)   tastes
C)   price
D)   expectationsE) All of the above
F) A) and D)

Question 7

When the price of a good or service changes,

Accepted Answer

A)   the supply curve shifts in the opposite direction.
B)   the demand curve shifts in the opposite direction.
C)   the demand curve shifts in the same direction.
D)   there is a movement along a given demand curve.E) None of the above
F) All of the above

Question 8

Which of the following is the least likely to be a competitive market?

Accepted Answer

A)   ice cream
B)   soybeans
C)   cable television
D)   new housesE) A) and D)
F) B) and C)

Question 9

A higher price for batteries would result in an)

Accepted Answer

A)   increase in the demand for flashlights.
B)   decrease in the demand for flashlights.
C)   increase in the demand for batteries.
D)   decrease in the demand for batteries.E) A) and D)
F) A) and C)

Question 10

An increase in the price of blue pens will increase both the equilibrium price and quantity in the market for black pens.

Accepted Answer

A) True 
 B)False

Question 11

The law of supply and demand asserts that

Accepted Answer

A)   demand curves and supply curves tend to shift to the right as time goes by.
B)   the price of a good will eventually rise in response to an excess demand for that good.
C)   when the supply curve for a good shifts, the demand curve for that good shifts in response.
D)   the equilibrium price of a good will be rising more often than it will be falling.E) B) and C)
F) None of the above

Question 12

For teenagers, a 10 percent increase in the price of cigarettes leads to a

Accepted Answer

A)   1 percent reduction in the quantity demanded of cigarettes.
B)   4 percent reduction in the quantity demanded of cigarettes.
C)   10 percent reduction in the quantity demanded of cigarettes.
D)   12 percent reduction in the quantity demanded of cigarettes.E) C) and D)
F) A) and B)

Question 13

Does a change in the price in a market result in a shift of the demand curve or in a movement along the demand curve?

Accepted Answer

A movement...

Question 14

Figure 4-26 
-Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for fences of a decrease in the price of wood?

Accepted Answer

A)   Point A to Point B
B)   Point C to Point B
C)   Point C to Point D
D)   Point A to Point DE) B) and C)
F) A) and D)

Question 15

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

Accepted Answer

A)   $2, there is a shortage 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 shortage of 4 units.E) All of the above
F) None of the above

Question 16

An increase in demand shifts the demand curve to the left.

Accepted Answer

A) True 
 B)False

Question 17

Table 4-2
 
-Refer to Table 4-2. Whose demand does not obey the law of demand?

Accepted Answer

A)   Abby's
B)   Brandi's
C)   Carrie's
D)   DeeDee'sE) B) and D)
F) B) and C)

Question 18

Table 4-8
 
-Refer to Table 4-8. If these are the only three sellers in the market, then an increase in the market price from $6 to $12 will increase quantity supplied by

Accepted Answer

A)   12 units.
B)   24 units.
C)   36 units.
D)   48 units.E) All of the above
F) C) and D)

Question 19

Which of the following would increase in response to a decrease in the price of ironing boards?

Accepted Answer

A)   the quantity of irons demanded at each possible price of irons
B)   the equilibrium quantity of irons
C)   the equilibrium price of irons
D)   All of the above are correct.E) B) and C)
F) A) and D)

Question 20

Today's supply curve for iPods could shift in response to a change in

Accepted Answer

A)   today's price of iPods.
B)   the expected future price of iPods.
C)   the number of buyers of iPods.
D)   All of the above are correct.E) B) and D)
F) B) and C)

Exam 4: The Market Forces of Supply and Demand

Figure 4-26 -Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for fences of a decrease in the price of wood?

Correct AnswerverifiedShow Answer

Suppose there is an increase in the price of steel. We would expect the supply curve for steel beams to

Correct AnswerverifiedShow Answer

When the price of a good or service changes,

Correct AnswerverifiedShow Answer

The equilibrium price is the same as the market-clearing price.

Correct AnswerverifiedShow Answer

Does a change in the price in a market result in a shift of the demand curve or in a movement along the demand curve?

Correct AnswerverifiedA movement...View AnswerShow Answer

An increase in the price of blue pens will increase both the equilibrium price and quantity in the market for black pens.

Correct AnswerverifiedShow Answer

Table 4-9 -Refer to Table 4-9. Which combination would produce a decrease in equilibrium quantity and an indeterminate change in equilibrium price?

Correct AnswerverifiedShow Answer

Which of the following is the least likely to be a competitive market?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Which of the following is not held constant in a demand schedule?

Correct AnswerverifiedShow Answer

A higher price for batteries would result in an)

Correct AnswerverifiedShow Answer

Today's supply curve for iPods could shift in response to a change in

Correct AnswerverifiedShow Answer

Table 4-8 -Refer to Table 4-8. If these are the only three sellers in the market, then an increase in the market price from $6 to $12 will increase quantity supplied by

Correct AnswerverifiedShow Answer

Suppose there is a flood in St. Louis, Missouri, that destroys several beer bottling facilities. Which of the following would not be a direct result of this event?

Correct AnswerverifiedShow Answer

A decrease in the price of a product and an increase in the number of buyers in the market affect the demand curve in the same general way.

Correct AnswerverifiedShow Answer

For teenagers, a 10 percent increase in the price of cigarettes leads to a

Correct AnswerverifiedShow Answer

The law of supply and demand asserts that

Correct AnswerverifiedShow Answer

Which of the following would increase in response to a decrease in the price of ironing boards?

Correct AnswerverifiedShow Answer

Table 4-2 -Refer to Table 4-2. Whose demand does not obey the law of demand?

Correct AnswerverifiedShow Answer

An increase in demand shifts the demand curve to the left.

Correct AnswerverifiedShow Answer

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A movement...
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