Question 1

Suppose that demand for a good decreases and, at the same time, supply of the good decreases. What would happen in the market for the good?

Accepted Answer

A)   Equilibrium price would decrease, but the impact on equilibrium quantity would be ambiguous.
B)   Equilibrium price would increase, but the impact on equilibrium quantity would be ambiguous.
C)   Equilibrium quantity would decrease, but the impact on equilibrium price would be ambiguous.
D)   Equilibrium quantity would increase, but the impact on equilibrium price would be ambiguous.E) B) and C)
F) All of the above

Question 2

Refer to Figure 4-30. In this market for tablet computers, more suppliers enter the market and the price of laptops, a substitute good, increases, while all other factors remain constant. Explain the changes) in the equilibrium price and quantity.

Accepted Answer

Equilibrium price is...

Question 3

The market for ice cream is a

Accepted Answer

A)   monopolistic market.
B)   highly competitive market.
C)   highly organized market.
D)   Both b and c are correct.E) None of the above
F) C) and D)

Question 4

The supply curve for stand up paddle boards

Accepted Answer

A)   shifts when the price of stand up paddle boards changes because the price of stand up paddle boards is measured on the vertical axis of the graph.
B)   shifts when the price of stand up paddle boards changes because the quantity supplied of stand up paddle boards is measured on the horizontal axis of the graph.
C)   does not shift when the price of stand up paddle boards changes because the price of stand up paddle boards is measured on the vertical axis of the graph.
D)   does not shift when the price of stand up paddle boards changes because the price of stand up paddle boards is measured on the horizontal axis of the graph.E) A) and D)
F) C) and D)

Question 5

If something happens to alter the quantity supplied at any given price, then

Accepted Answer

A)   we move along the supply curve.
B)   the supply curve shifts.
C)   the supply curve becomes steeper.
D)   the supply curve becomes flatter.E) None of the above
F) A) and D)

Question 6

Which of these statements does not apply to market economies?

Accepted Answer

A)   Prices prevent decentralized decision making from degenerating into chaos.
B)   Prices coordinate the actions of millions of people with varying abilities and desires.
C)   Prices ensure that anyone who wants a product can get it.
D)   Prices ensure that what needs to get done does in fact get done.E) B) and C)
F) C) and D)

Question 7

Other things equal, when the price of a good falls, the

Accepted Answer

A)   quantity supplied of the good increases.
B)   supply decreases.
C)   quantity supplied of the good decreases.
D)   demand increases.E) C) and D)
F) B) and D)

Question 8

Ford Motor Company announces that next month it will offer $3,000 rebates on new Mustangs. As a result of this information, today's demand curve for Mustangs

Accepted Answer

A)   shifts to the right.
B)   shifts to the left.
C)   shifts either to the right or to the left, but we cannot determine the direction of the shift from the given information.
D)   will not shift; rather, the demand curve for Mustangs will shift to the right next month.E) A) and B)
F) A) and C)

Question 9

Today's demand curve for gasoline could shift in response to a change in

Accepted Answer

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

Question 10

Figure 4-25
The graph below pertains to the supply of paper to colleges and universities. 
-Refer to Figure 4-25. All else equal, an increase in the use of laptop computers for note-taking would cause a move from

Accepted Answer

A)   x to y.
B)   y to x.
C)   SA to SB.
D)   SB to SA.E) All of the above
F) B) and C)

Question 11

A market supply curve shows how the total quantity supplied of a good varies as

Accepted Answer

A)   production technology varies.
B)   price varies.
C)   input prices vary.
D)   demand varies.E) B) and D)
F) B) and C)

Question 12

Table 4-15
The following table shows the number of cases of water each seller is willing to sell at the prices listed.
 
-Refer to Table 4-15. Assume these are the only four suppliers in this market and the function for market demand is QD=1000-100P, where QD is the quantity demanded and P is the price. If the price is $6 per case, is there a shortage or surplus, and how large is the shortage or surplus?

Accepted Answer

There is a...

Question 13

Suppose roses are currently selling for $20 per dozen, but the equilibrium price of roses is $30 per dozen. We would expect a

Accepted Answer

A)   shortage to exist and the market price of roses to increase.
B)   shortage to exist and the market price of roses to decrease.
C)   surplus to exist and the market price of roses to increase.
D)   surplus to exist and the market price of roses to decrease.E) B) and D)
F) All of the above A

Question 14

A decrease in supply will cause an increase in price, which will cause a decrease in quantity demanded.

Accepted Answer

A) True 
 B)False

Question 15

Figure 4-26 
-Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for Ramen noodles of a decrease in the incomes of young adults, assuming that Ramen noodles are an inferior good?

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) None of the above
F) A) and C) D

Question 16

Fill in the table below, showing whether equilibrium price and equilibrium quantity go up, go down, stay the same, or change ambiguously.

Accepted Answer

The answer of Fill in the table below, showing whether...

Question 17

A decrease in the price of a good will

Accepted Answer

A)   increase supply.
B)   decrease supply.
C)   increase quantity supplied.
D)   decrease quantity supplied.E) None of the above
F) B) and D)

Question 18

A decrease in demand shifts the demand curve to the left.

Accepted Answer

A) True 
 B)False  True

Question 19

Assume the market for pork is perfectly competitive. When one pork buyer exits the market,

Accepted Answer

A)   the price of pork increases.
B)   the price of pork decreases.
C)   the price of pork does not change.
D)   there is no longer a market for pork.E) A) and B)
F) None of the above

Question 20

Table 4-13
The demand schedule below pertains to sandwiches demanded per week.
 
-Refer to Table 4-13. Regarding Harry and Darby, whose demand for sandwiches conforms to the law of demand?

Accepted Answer

A)   only Harry's
B)   only Darby's
C)   both Harry's and Darby's
D)   neither Harry's nor Darby'sE) B) and C)
F) A) and B)

Exam 4: The Market Forces of Supply and Demand

Suppose that demand for a good decreases and, at the same time, supply of the good decreases. What would happen in the market for the good?

Correct Answer
verified

Refer to Figure 4-30. In this market for tablet computers, more suppliers enter the market and the price of laptops, a substitute good, increases, while all other factors remain constant. Explain the changes) in the equilibrium price and quantity.

Correct Answer
verified
Equilibrium price is...
View Answer

The market for ice cream is a

Correct Answer
verified

The supply curve for stand up paddle boards

Correct Answer
verified

If something happens to alter the quantity supplied at any given price, then

Correct Answer
verified

Which of these statements does not apply to market economies?

Correct Answer
verified

Other things equal, when the price of a good falls, the

Correct Answer
verified

Ford Motor Company announces that next month it will offer $3,000 rebates on new Mustangs. As a result of this information, today's demand curve for Mustangs

Correct Answer
verified

Today's demand curve for gasoline could shift in response to a change in

Correct Answer
verified

Figure 4-25 The graph below pertains to the supply of paper to colleges and universities. -Refer to Figure 4-25. All else equal, an increase in the use of laptop computers for note-taking would cause a move from

Correct Answer
verified

A market supply curve shows how the total quantity supplied of a good varies as

Correct Answer
verified

Correct Answer
verified
There is a...
View Answer

Suppose roses are currently selling for $20 per dozen, but the equilibrium price of roses is $30 per dozen. We would expect a

Correct Answer
verified
A

A decrease in supply will cause an increase in price, which will cause a decrease in quantity demanded.

Correct Answer
verified

Figure 4-26 -Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for Ramen noodles of a decrease in the incomes of young adults, assuming that Ramen noodles are an inferior good?

Correct Answer
verified
D

Fill in the table below, showing whether equilibrium price and equilibrium quantity go up, go down, stay the same, or change ambiguously.

Correct Answer
verified

A decrease in the price of a good will

Correct Answer
verified

A decrease in demand shifts the demand curve to the left.

Correct Answer
verified
True

Assume the market for pork is perfectly competitive. When one pork buyer exits the market,

Correct Answer
verified

Table 4-13 The demand schedule below pertains to sandwiches demanded per week. -Refer to Table 4-13. Regarding Harry and Darby, whose demand for sandwiches conforms to the law of demand?

Correct Answer
verified

Exam 4: The Market Forces of Supply and Demand

Suppose that demand for a good decreases and, at the same time, supply of the good decreases. What would happen in the market for the good?

Correct AnswerverifiedShow Answer

Refer to Figure 4-30. In this market for tablet computers, more suppliers enter the market and the price of laptops, a substitute good, increases, while all other factors remain constant. Explain the changes) in the equilibrium price and quantity.

Correct AnswerverifiedEquilibrium price is...View AnswerShow Answer

The market for ice cream is a

Correct AnswerverifiedShow Answer

The supply curve for stand up paddle boards

Correct AnswerverifiedShow Answer

If something happens to alter the quantity supplied at any given price, then

Correct AnswerverifiedShow Answer

Which of these statements does not apply to market economies?

Correct AnswerverifiedShow Answer

Other things equal, when the price of a good falls, the

Correct AnswerverifiedShow Answer

Ford Motor Company announces that next month it will offer $3,000 rebates on new Mustangs. As a result of this information, today's demand curve for Mustangs

Correct AnswerverifiedShow Answer

Today's demand curve for gasoline could shift in response to a change in

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, an increase in the use of laptop computers for note-taking would cause a move from

Correct AnswerverifiedShow Answer

A market supply curve shows how the total quantity supplied of a good varies as

Correct AnswerverifiedShow Answer

Correct AnswerverifiedThere is a...View AnswerShow Answer

Suppose roses are currently selling for $20 per dozen, but the equilibrium price of roses is $30 per dozen. We would expect a

Correct AnswerverifiedA

A decrease in supply will cause an increase in price, which will cause a decrease in quantity demanded.

Correct AnswerverifiedShow Answer

Figure 4-26 -Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for Ramen noodles of a decrease in the incomes of young adults, assuming that Ramen noodles are an inferior good?

Correct AnswerverifiedD

Fill in the table below, showing whether equilibrium price and equilibrium quantity go up, go down, stay the same, or change ambiguously.

Correct AnswerverifiedShow Answer

A decrease in the price of a good will

Correct AnswerverifiedShow Answer

A decrease in demand shifts the demand curve to the left.

Correct AnswerverifiedTrue

Assume the market for pork is perfectly competitive. When one pork buyer exits the market,

Correct AnswerverifiedShow Answer

Table 4-13 The demand schedule below pertains to sandwiches demanded per week. -Refer to Table 4-13. Regarding Harry and Darby, whose demand for sandwiches conforms to the law of demand?

Correct AnswerverifiedShow Answer

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Equilibrium price is...
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There is a...
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A

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D

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True

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