Question 1

Figure 4-26 
-Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for convertible automobiles of an increase in the price of steel?

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 D)
F) C) and D)

Question 2

Figure 4-22 
-Refer to Figure 4-22. At a price of $20, there is a

Accepted Answer

A)  surplus of 4 units.
B)  surplus of 8 units.
C)  shortage of 4 units.
D)  shortage of 8 units.E) A) and B)
F) A) and C)

Question 3

A decrease in the price of blueberries will decrease both the equilibrium price and quantity in the market for blueberry muffins.

Accepted Answer

A) True 
 B)False

Question 4

Figure 4-8 
-Refer to Figure 4-8. Suppose the figure shows the market demand for Big Box e-readers. Suppose the price of the leading competitor's e-readers, a substitute good, decreases. Which of the following changes would occur?

Accepted Answer

A)  a movement along D2 from point A to point B
B)  a movement along D2 from point B to point A
C)  a shift from D1 to D2
D)  a shift from D2 to D1E) A) and C)
F) None of the above

Question 5

If consumers view cappuccinos and lattés as substitutes, what would happen to the equilibrium price and quantity of lattés if the price of cappuccinos rises?

Accepted Answer

A)  Both the equilibrium price and quantity would increase.
B)  Both the equilibrium price and quantity would decrease.
C)  The equilibrium price would increase, and the equilibrium quantity would decrease.
D)  The equilibrium price would decrease, and the equilibrium quantity would increase.E) C) and D)
F) None of the above

Question 6

Figure 4-21 
-Refer to Figure 4-21. At a price of $16, there is a

Accepted Answer

A)  surplus of 1 unit.
B)  surplus of 3 units.
C)  shortage of 1 unit.
D)  shortage of 3 units.E) A) and D)
F) A) and C)

Question 7

Prices allocate a market economy's scarce resources.

Accepted Answer

A) True 
 B)False

Question 8

What would happen to the equilibrium price and quantity of lattés if consumers' incomes rise and lattés are a normal good?

Accepted Answer

A)  Both the equilibrium price and quantity would increase.
B)  Both the equilibrium price and quantity would decrease.
C)  The equilibrium price would increase, and the equilibrium quantity would decrease.
D)  The equilibrium price would decrease, and the equilibrium quantity would increase.E) None of the above
F) C) and D)

Question 9

A decrease in the price of peanut butter will increase both the equilibrium price and quantity in the market for jelly.

Accepted Answer

A) True 
 B)False

Question 10

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) A) and C)

Question 11

Table 4-3 
-Refer to Table 4-3. For whom is the good a normal good?

Accepted Answer

A)  Bert only
B)  Grover only
C)  Bert, Ernie, Grover, and Oscar
D)  This cannot be determined from the table.E) A) and C)
F) B) and C)

Question 12

When quantity supplied exceeds quantity demanded at the current market price, the market has a surplus, and market price will likely rise in the future to eliminate the surplus.

Accepted Answer

A) True 
 B)False

Question 13

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

Accepted Answer

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

Question 14

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

Question 15

The supply curve for a good is a line that relates

Accepted Answer

A)  profit and quantity supplied.
B)  quantity supplied and quantity demanded.
C)  price and quantity supplied.
D)  price and profit.E) A) and D)
F) A) and C)

Question 16

A rightward shift of a demand curve is called a(n)

Accepted Answer

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

Question 17

Which of these statements best represents the law of supply?

Accepted Answer

A)  When input prices increase, sellers produce less of the good.
B)  When production technology improves, sellers produce less of the good.
C)  When the price of a good decreases, sellers produce less of the good.
D)  When sellers' supplies of a good increase, the price of the good increases.E) C) and D)
F) A) and B)

Question 18

Consider the market for portable air conditioners in equilibrium. A summer of unseasonably cool weather would cause

Accepted Answer

A)  both the equilibrium price and quantity to decrease.
B)  both the equilibrium price and quantity to increase.
C)  the equilibrium price to increase and the equilibrium quantity to decrease.
D)  the equilibrium price to decrease and the equilibrium quantity to increase.E) A) and B)
F) A) and C)

Question 19

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 20

According to the law of demand, when price increases the quantity demanded of a good

Accepted Answer

The answer of According to the law of demand, when...

Exam 4: The Market Forces of Supply and Demand

According to the law of demand, when price increases the quantity demanded of a good

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A decrease in the price of peanut butter will increase both the equilibrium price and quantity in the market for jelly.

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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.

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Table 4-3 -Refer to Table 4-3. For whom is the good a normal good?

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A decrease in the price of blueberries will decrease both the equilibrium price and quantity in the market for blueberry muffins.

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Prices allocate a market economy's scarce resources.

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What would happen to the equilibrium price and quantity of lattés if consumers' incomes rise and lattés are a normal good?

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Figure 4-8 -Refer to Figure 4-8. Suppose the figure shows the market demand for Big Box e-readers. Suppose the price of the leading competitor's e-readers, a substitute good, decreases. Which of the following changes would occur?

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Figure 4-21 -Refer to Figure 4-21. At a price of $16, there is a

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Figure 4-26 -Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for convertible automobiles of an increase in the price of steel?

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A rightward shift of a demand curve is called a(n)

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The supply curve for a good is a line that relates

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The market for ice cream is a

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Figure 4-22 -Refer to Figure 4-22. At a price of $20, there is a

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Most markets in the economy are

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Which of these statements best represents the law of supply?

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

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If consumers view cappuccinos and lattés as substitutes, what would happen to the equilibrium price and quantity of lattés if the price of cappuccinos rises?

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When quantity supplied exceeds quantity demanded at the current market price, the market has a surplus, and market price will likely rise in the future to eliminate the surplus.

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Consider the market for portable air conditioners in equilibrium. A summer of unseasonably cool weather would cause

Correct AnswerverifiedShow Answer

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