Question 1

Suppose the price of gasoline and other petroleum products decline sharply. Which of the following will most likely occur as a result of the lower petroleum prices?

Accepted Answer

A)  ​an increase in demand for solar heating systems
B)  ​an increase in demand for larger, more powerful automobiles
C)  ​an increase in demand for home insulation products
D)  ​an increase in demand for gasolineE) C) and D)
F) All of the above

Question 2

The demand schedule for a good:

Accepted Answer

A)  ​indicates the quantity that people will buy at the prevailing price.
B)  ​indicates the quantities that suppliers will sell at various market prices.
C)  ​indicates the quantities that will be purchased at alternative market prices.
D)  ​is determined primarily by the cost of producing the good.E) A) and D)
F) A) and C)

Question 3

A downward-sloping demand curve shows:

Accepted Answer

A)  ​the direct relationship between price and quantity supplied; as price increases, the quantity supplied increases.
B)  ​the inverse relationship between price and quantity supplied; as price increases, the quantity supplied decreases.
C)  ​the direct relationship between price and quantity demanded; as price increases, the quantity demanded increases.
D)  ​the inverse relationship between price and quantity demanded; as price increases, the quantity demanded decreases.E) None of the above
F) A) and B)

Question 4

The law of demand states that, ceteris paribus, an increase in

Accepted Answer

A)  ​price causes quantity demanded to increase.
B)  ​price causes quantity demanded to decrease.
C)  ​quantity demanded causes price to increase.
D)  ​quantity demanded causes price to decrease.E) A) and B)
F) None of the above

Question 5

At the equilibrium price, the quantity of the good that buyers are willing and able to buy

Accepted Answer

A)  ​is greater than the quantity that sellers are willing and able to sell.
B)  ​exactly equals the quantity that sellers are willing and able to sell.
C)  ​is less than the quantity that sellers are willing and able to sell.
D)  ​there is no scarcity.E) B) and D)
F) All of the above

Question 6

As the price of DVD players has fallen over the last two years, more DVD players have been sold by consumer electronics firms. Is this a violation of the law of supply?

Accepted Answer

No. Very likely the reduction in price i...

Question 7

Refer to the table below. If these three firms represented the entire market, how many mid-sized autos would be supplied at a price of $30,000? ​
Price for
Mid-Sized Auto
​
GM
​
Ford
​
Chrysler
​
Market
$22,000
10,000
8,000
4,000
​
$24,000
12,000
10,000
5,000
​
$26,000
15,000
12,000
7,000
​
$28,000
19,000
14,000
10,000
​
$30,000
24,000
16,000
14,000
​

Accepted Answer

A)  ​43,000
B)  ​54,000
C)  ​126,000
D)  ​158,000E) A) and C)
F) B) and D)

Question 8

If the market for wheat is in equilibrium, the quantity of wheat demanded will equal the quantity of wheat supplied.

Accepted Answer

A) True 
 B)False

Question 9

Dean bakes his famous apple pies and sells them at the local farmer's market. If the price of apples increases, the

Accepted Answer

A)  ​supply curve for Dean's pies will increase.
B)  ​supply curve for Dean's pies will decrease.
C)  ​demand curve for Dean's pies will increase.
D)  ​demand curve for Dean's pies will decrease.E) All of the above
F) B) and D)

Question 10

An increase in the price of ice cream would cause a decrease in the demand for ice cream and an increase in the demand for frozen yogurt, a substitute.

Accepted Answer

A) True 
 B)False

Question 11

Exhibit 4-2 1, a shift to D2 would indicate a(n) : A) ​increase in demand. B) ​decrease in demand. C) ​increase in quantity demanded. D) ​decrease in quantity demanded." class="answers-bank-image d-inline" rel="preload" >
-Refer to Exhibit 4-2. Using the graph and beginning on D1, a shift to D2 would indicate a(n) :

Accepted Answer

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

Question 12

Two goods are complements if a decrease in the price of one causes an increase in the demand for the other good.

Accepted Answer

A) True 
 B)False

Question 13

Differentiate between a change in quantity demanded and a change in demand.

Accepted Answer

A change in a good's own, current price ...

Question 14

In the three months before a $1 per pack cigarette tax took effect in Alaska, smokers bought 175 million more cigarettes than during the same period a year earlier. What explains this behavior by consumers?

Accepted Answer

The increase of $1 per pack is pretty si...

Question 15

Which of the following will not cause a change in the demand for a product?

Accepted Answer

A)  ​a change in consumer income
B)  ​a change in consumer preferences
C)  ​a change in the price of the product
D)  ​a change in the price of a substitute productE) All of the above
F) A) and B)

Question 16

An increase in the price of a good will

Accepted Answer

A)  ​increase supply.
B)  ​decrease supply.
C)  ​increase quantity supplied.
D)  ​decrease quantity supplied.E) All of the above
F) A) and B)

Question 17

Skippy loves peanut butter. Skippy reads on the internet that 75 percent of the peanut crop in the South has been wiped out by drought, and that this will cause the price of peanuts to more than double by the end of the year. As a result,

Accepted Answer

A)  ​Skippy's demand for peanut butter will increase, but not until the end of the year.
B)  ​Skippy's demand for peanut butter increases today.
C)  ​Skippy's demand for peanut butter decreases as he considers buying almond butter.
D)  ​Skippy's demand for peanut butter shifts left today.E) None of the above
F) B) and D)

Question 18

An increase in demand could be caused by

Accepted Answer

A)  ​a decrease in price.
B)  ​a decrease in income, assuming the good is inferior.
C)  ​buyers expecting the price of the good to fall in the near future.
D)  ​an increase in the price of a complement.E) All of the above
F) A) and D)

Question 19

Sellers who were originally willing to supply 800 units of a good at $4 per unit are now willing to supply 600 units at $4 per unit. That change would be described as:

Accepted Answer

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

Question 20

How do orange growers react to the news of medical research findings that suggest that eating oranges leads to greater health benefits than were previously known?

Accepted Answer

A)  ​They increase the supply of oranges.
B)  ​They increase the quantity of oranges supplied.
C)  ​They decrease the supply of oranges.
D)  ​They decrease the quantity of oranges supplied.E) C) and D)
F) A) and D)

Exam 4: Demand, Supply, and Market Equilibrium

Two goods are complements if a decrease in the price of one causes an increase in the demand for the other good.

Correct Answer
verified

As the price of DVD players has fallen over the last two years, more DVD players have been sold by consumer electronics firms. Is this a violation of the law of supply?

Correct Answer
verified
No. Very likely the reduction in price i...
View Answer

A downward-sloping demand curve shows:

Correct Answer
verified

If the market for wheat is in equilibrium, the quantity of wheat demanded will equal the quantity of wheat supplied.

Correct Answer
verified

An increase in demand could be caused by

Correct Answer
verified

An increase in the price of ice cream would cause a decrease in the demand for ice cream and an increase in the demand for frozen yogurt, a substitute.

Correct Answer
verified

Skippy loves peanut butter. Skippy reads on the internet that 75 percent of the peanut crop in the South has been wiped out by drought, and that this will cause the price of peanuts to more than double by the end of the year. As a result,

Correct Answer
verified

Dean bakes his famous apple pies and sells them at the local farmer's market. If the price of apples increases, the

Correct Answer
verified

Differentiate between a change in quantity demanded and a change in demand.

Correct Answer
verified
A change in a good's own, current price ...
View Answer

In the three months before a $1 per pack cigarette tax took effect in Alaska, smokers bought 175 million more cigarettes than during the same period a year earlier. What explains this behavior by consumers?

Correct Answer
verified
The increase of $1 per pack is pretty si...
View Answer

Which of the following will not cause a change in the demand for a product?

Correct Answer
verified

How do orange growers react to the news of medical research findings that suggest that eating oranges leads to greater health benefits than were previously known?

Correct Answer
verified

Exhibit 4-2 -Refer to Exhibit 4-2. Using the graph and beginning on D₁, a shift to D₂ would indicate a(n) :

Correct Answer
verified

An increase in the price of a good will

Correct Answer
verified

Correct Answer
verified

The demand schedule for a good:

Correct Answer
verified

The law of demand states that, ceteris paribus, an increase in

Correct Answer
verified

At the equilibrium price, the quantity of the good that buyers are willing and able to buy

Correct Answer
verified

Sellers who were originally willing to supply 800 units of a good at $4 per unit are now willing to supply 600 units at $4 per unit. That change would be described as:

Correct Answer
verified

Suppose the price of gasoline and other petroleum products decline sharply. Which of the following will most likely occur as a result of the lower petroleum prices?

Correct Answer
verified

Exam 4: Demand, Supply, and Market Equilibrium

Two goods are complements if a decrease in the price of one causes an increase in the demand for the other good.

Correct AnswerverifiedShow Answer

As the price of DVD players has fallen over the last two years, more DVD players have been sold by consumer electronics firms. Is this a violation of the law of supply?

Correct AnswerverifiedNo. Very likely the reduction in price i...View AnswerShow Answer

A downward-sloping demand curve shows:

Correct AnswerverifiedShow Answer

If the market for wheat is in equilibrium, the quantity of wheat demanded will equal the quantity of wheat supplied.

Correct AnswerverifiedShow Answer

An increase in demand could be caused by

Correct AnswerverifiedShow Answer

An increase in the price of ice cream would cause a decrease in the demand for ice cream and an increase in the demand for frozen yogurt, a substitute.

Correct AnswerverifiedShow Answer

Skippy loves peanut butter. Skippy reads on the internet that 75 percent of the peanut crop in the South has been wiped out by drought, and that this will cause the price of peanuts to more than double by the end of the year. As a result,

Correct AnswerverifiedShow Answer

Dean bakes his famous apple pies and sells them at the local farmer's market. If the price of apples increases, the

Correct AnswerverifiedShow Answer

Differentiate between a change in quantity demanded and a change in demand.

Correct AnswerverifiedA change in a good's own, current price ...View AnswerShow Answer

In the three months before a $1 per pack cigarette tax took effect in Alaska, smokers bought 175 million more cigarettes than during the same period a year earlier. What explains this behavior by consumers?

Correct AnswerverifiedThe increase of $1 per pack is pretty si...View AnswerShow Answer

Which of the following will not cause a change in the demand for a product?

Correct AnswerverifiedShow Answer

How do orange growers react to the news of medical research findings that suggest that eating oranges leads to greater health benefits than were previously known?

Correct AnswerverifiedShow Answer

Exhibit 4-2 -Refer to Exhibit 4-2. Using the graph and beginning on D1, a shift to D2 would indicate a(n) :

Correct AnswerverifiedShow Answer

An increase in the price of a good will

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The demand schedule for a good:

Correct AnswerverifiedShow Answer

The law of demand states that, ceteris paribus, an increase in

Correct AnswerverifiedShow Answer

At the equilibrium price, the quantity of the good that buyers are willing and able to buy

Correct AnswerverifiedShow Answer

Sellers who were originally willing to supply 800 units of a good at $4 per unit are now willing to supply 600 units at $4 per unit. That change would be described as:

Correct AnswerverifiedShow Answer

Suppose the price of gasoline and other petroleum products decline sharply. Which of the following will most likely occur as a result of the lower petroleum prices?

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified
No. Very likely the reduction in price i...
View Answer

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
verified

Correct Answer
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Correct Answer
verified

Correct Answer
verified
A change in a good's own, current price ...
View Answer

Correct Answer
verified
The increase of $1 per pack is pretty si...
View Answer

Correct Answer
verified

Correct Answer
verified

Exhibit 4-2 -Refer to Exhibit 4-2. Using the graph and beginning on D₁, a shift to D₂ would indicate a(n) :

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
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