Question 1

Suppose that demand for a good increases 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) A) and D)
F) None of the above

Question 2

Ashley bakes bread that she sells at the local farmer's market.If she purchases a new convection oven that reduces the costs of baking bread,the

Accepted Answer

A)   supply curve for Ashley's bread will increase.
B)   supply curve for Ashley's bread will decrease.
C)   demand curve for Ashley's bread will increase.
D)   demand curve for Ashley's bread will decrease.E) C) and D)
F) B) and D)

Question 3

Suppose goods A and B are complements.If the price of good A increases,will the demand for good B increase or decrease?

Accepted Answer

The demand...

Question 4

When quantity demanded has increased at every price,it might be because

Accepted Answer

A)   the number of buyers in the market has decreased.
B)   income has increased,and the good is an inferior good.
C)   the costs incurred by sellers producing the good have decreased.
D)   the price of a complementary good has decreased.E) A) and D)
F) All of the above

Question 5

Most markets in the economy are

Accepted Answer

A)   markets in which sellers,rather than buyers,control the price of the product.
B)   markets in which buyers,rather than sellers,control the price of the product.
C)   perfectly competitive.
D)   highly competitive.E) B) and C)
F) B) and D)

Question 6

Figure 4-15 
-Refer to Figure 4-15.At a price of $20,there would be a(n)

Accepted Answer

A)   shortage.The law of supply and demand predicts that the price will fall from $20 to a lower price.
B)   surplus.The law of supply and demand predicts that the price will rise from $20 to a higher price.
C)   excess demand.The law of supply and demand predicts that the price will rise from $20 to a higher price.
D)   excess supply.The law of supply and demand predicts that the price will fall from $20 to a lower price.E) C) and D)
F) B) and D)

Question 7

A decrease in the number of sellers in the market causes

Accepted Answer

A)   the supply curve to shift to the left.
B)   the supply curve to shift to the right.
C)   a movement up and to the right along a stationary supply curve.
D)   a movement downward and to the left along a stationary supply curve.E) B) and C)
F) All of the above

Question 8

A decrease in income will shift the demand curve for an inferior good to the right.

Accepted Answer

A) True 
 B)False

Question 9

Figure 4-1 
-Refer to Figure 4-1.The movement from point A to point B on the graph shows

Accepted Answer

A)   a decrease in demand.
B)   an increase in demand.
C)   a decrease in quantity demanded.
D)   an increase in quantity demanded.E) All of the above
F) B) and C)

Question 10

A improvement in production technology will shift the

Accepted Answer

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

Question 11

Table 4-2
 
-Refer to Table 4-2.If these are the only three sellers in the market,then the market quantity supplied at a price of $6 is

Accepted Answer

A)   6 units.
B)   12 units.
C)   18 units.
D)   24 units.E) All of the above
F) None of the above

Question 12

Figure 4-11

-Refer to Figure 4-11.If these are the only two sellers in the market,then the market quantity supplied at a price of $6 is

Accepted Answer

A)   2 units.
B)   10 units.
C)   12 units.
D)   22 units.E) A) and B)
F) None of the above

Question 13

Table 4-6
 
-Which of the following would cause price to decrease?

Accepted Answer

A)   a decrease in supply
B)   an increase in demand
C)   a surplus of the good
D)   a shortage of the goodE) B) and C)
F) B) and D)

Question 14

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

Question 15

For a competitive market,

Accepted Answer

A)   a seller can always increase her profit by raising the price of her product.
B)   if a seller charges more than the going price,buyers will go elsewhere to make their purchases.
C)   a seller often charges less than the going price to increase sales and profit.
D)   a single buyer can influence the price of the product but only when purchasing from several sellers in a short period of time.E) B) and D)
F) B) and C)

Question 16

Table 4-7
 
-Refer to Table 4-7.If the price were $8,a

Accepted Answer

A)   shortage of 20 units would exist,and price would tend to rise.
B)   surplus of 25 units would exist,and price would tend to fall.
C)   shortage of 25 units would exist,and price would tend to rise.
D)   surplus of 45 units would exist,and price would tend to fall.E) B) and C)
F) A) and D)

Question 17

All goods and services are sold in perfectly competitive markets.

Accepted Answer

A) True 
 B)False

Question 18

A table that shows the relationship between the price of a good and the quantity demanded of that good is called a

Accepted Answer

A)   price-quantity schedule.
B)   buyer schedule.
C)   demand schedule.
D)   demand curve.E) All of the above
F) B) and C)

Question 19

Table 4-9
The demand schedule below pertains to sandwiches demanded per week.
 
-Refer to Table 4-9.Regarding Harry and Darby,for whom are sandwiches a normal good?

Accepted Answer

A)   only for Harry
B)   only for Darby
C)   for both Harry and Darby
D)   This cannot be determined from the given information.E) None of the above
F) A) and B)

Question 20

A decrease in quantity demanded

Accepted Answer

A)   results in a movement downward and to the right along a demand curve.
B)   results in a movement upward and to the left along a demand curve.
C)   shifts the demand curve to the left.
D)   shifts the demand curve to the right.E) B) and C)
F) A) and B)

Exam 4: The Market Forces of Supply and Demand

Figure 4-11 -Refer to Figure 4-11.If these are the only two sellers in the market,then the market quantity supplied at a price of $6 is

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Table 4-7 -Refer to Table 4-7.If the price were $8,a

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Table 4-9 The demand schedule below pertains to sandwiches demanded per week. -Refer to Table 4-9.Regarding Harry and Darby,for whom are sandwiches a normal good?

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A decrease in the number of sellers in the market causes

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

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When quantity demanded has increased at every price,it might be because

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

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A decrease in quantity demanded

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Table 4-2 -Refer to Table 4-2.If these are the only three sellers in the market,then the market quantity supplied at a price of $6 is

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For a competitive market,

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A decrease in income will shift the demand curve for an inferior good to the right.

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Ashley bakes bread that she sells at the local farmer's market.If she purchases a new convection oven that reduces the costs of baking bread,the

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Table 4-6 -Which of the following would cause price to decrease?

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Figure 4-15 -Refer to Figure 4-15.At a price of $20,there would be a(n)

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Suppose goods A and B are complements.If the price of good A increases,will the demand for good B increase or decrease?

Correct AnswerverifiedThe demand...View AnswerShow Answer

Most markets in the economy are

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A improvement in production technology will shift the

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A table that shows the relationship between the price of a good and the quantity demanded of that good is called a

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All goods and services are sold in perfectly competitive markets.

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Figure 4-1 -Refer to Figure 4-1.The movement from point A to point B on the graph shows

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The demand...
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