Question 1

If the supply of tennis balls, a complement to tennis racquets, decreases, what will happen to the equilibrium price of tennis balls and to the equilibrium price of tennis racquets?

Accepted Answer

The equilibrium pric...

Question 2

Table 4-16
The following table shows the supply and demand schedules in a market.
 
-Refer to Table 4-16. If the supply curve shifts to the right, will the price in this market rise or fall?

Accepted Answer

The price ...

Question 3

Figure 4-24
The diagram below pertains to the demand for turkey in the United States. 
-Refer to Figure 4-24. All else equal, a large number of people becoming vegetarians would cause a move from

Accepted Answer

A)   DA to DB.
B)   DB to Db.
C)   x to y.
D)   y to x.E) A) and B)
F) B) and C)

Question 4

Figure 4-14 
-Refer to Figure 4-14. Which of the following best describes the movement from E1 to E2?

Accepted Answer

A)   a decrease in supply
B)   an increase in supply
C)   a movement along the supply curve
D)   a decrease in demandE) A) and D)
F) A) and B)

Question 5

Once the supply curve for a product or service is drawn, it

Accepted Answer

A)   remains stable over time.
B)   can shift either rightward or leftward.
C)   is possible to move along the curve, but the curve will not shift.
D)   tends to become steeper over time.E) All of the above
F) B) and C)

Question 6

Which of the following would most likely serve as an example of a monopoly?

Accepted Answer

A)   a bakery in a large city
B)   a bank in a large city
C)   a local cable television company
D)   a small group of corn farmersE) C) and D)
F) None of the above

Question 7

Figure 4-6 
-Refer to Figure 4-6. Suppose that the federal government is concerned about obesity in the United States. Congress is considering two plans. One would require "junk food" producers to include warning labels on all junk food. The other would impose a tax on all products considered to be junk food. If the warning labels are successful, we could illustrate the plan as producing a movement from

Accepted Answer

A)   Point A to Point B in Panel 1.
B)   Point B to Point A in Panel 1.
C)   Point A to Point C in Panel 2.
D)   Point C to Point A in Panel 2.E) A) and B)
F) None of the above

Question 8

When quantity demanded decreases at every possible price, the demand curve has

Accepted Answer

A)   shifted to the left.
B)   shifted to the right.
C)   not shifted; rather, we have moved along the demand curve to a new point on the same curve.
D)   not shifted; rather, the demand curve has become flatter.E) A) and D)
F) B) and C)

Question 9

A newspaper's classified ads are an example of a market.

Accepted Answer

A) True 
 B)False

Question 10

New cars are normal goods. What will happen to the equilibrium price of new cars if the price of gasoline rises, the price of steel falls, public transportation becomes cheaper and more comfortable, auto-workers accept lower wages, and automobile insurance becomes more expensive?

Accepted Answer

A)   Price will rise.
B)   Price will fall.
C)   Price will stay exactly the same.
D)   The price change will be ambiguous.E) A) and B)
F) B) and C)

Question 11

Consider the market for portable air conditioners in equilibrium. When a heat wave strikes the equilibrium price

Accepted Answer

A)   and quantity both decrease.
B)   and quantity both increase.
C)   increases, and the equilibrium quantity decreases.
D)   decreases, and the equilibrium quantity increases.E) C) and D)
F) B) and D)

Question 12

Figure 4-18 
-Refer to Figure 4-18. 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) A) and C)
F) None of the above

Question 13

Table 4-1
 
-Refer to Table 4-1. If the market consists of Michelle and Laura only and the price falls by $1, the quantity demanded in the market increases by

Accepted Answer

A)   2 units.
B)   3 units.
C)   4 units.
D)   5 units.E) A) and D)
F) B) and D)

Question 14

The law of supply states that, other things equal, an increase in

Accepted Answer

A)   price causes quantity supplied to increase.
B)   price causes quantity supplied to decrease.
C)   quantity supplied causes price to increase.
D)   quantity supplied causes price to decrease.E) B) and C)
F) B) and D)

Question 15

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

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) All of the above
F) None of the above

Question 16

Figure 4-5 
-Refer to Figure 4-5. Which of the following would cause the demand curve to shift from Demand A to Demand B in the market for oranges in the United States?

Accepted Answer

A)   a freeze in Florida
B)   a technological advance that allows oranges to ripen faster
C)   a decrease in the price of apples
D)   an announcement by the FDA that oranges prevent heart diseaseE) B) and C)
F) None of the above

Question 17

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

Question 18

The sum of all the individual supply curves for a product is called

Accepted Answer

A)   total supply.
B)   market supply.
C)   aggregate supply.
D)   total output.E) A) and B)
F) A) and D)

Question 19

Table 4-6
 
-Refer to Table 4-6. Which supply schedules obey the law of supply?

Accepted Answer

A)   Firm A's only
B)   Firm B's, Firm C's, and Firm D's only
C)   Firm A's and Firm C's only
D)   Firm B's and Firm D's onlyE) C) and D)
F) A) and C)

Question 20

Figure 4-18 
-Refer to Figure 4-18. At a price of $35, there would be a

Accepted Answer

A)   shortage of 400 units.
B)   surplus of 200 units.
C)   surplus of 400 units.
D)   surplus of 600 units.E) A) and B)
F) B) and C)

Exam 4: The Market Forces of Supply and Demand

Table 4-16 The following table shows the supply and demand schedules in a market. -Refer to Table 4-16. If the supply curve shifts to the right, will the price in this market rise or fall?

Correct Answer
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The price ...
View Answer

Figure 4-14 -Refer to Figure 4-14. Which of the following best describes the movement from E1 to E2?

Correct Answer
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If the supply of tennis balls, a complement to tennis racquets, decreases, what will happen to the equilibrium price of tennis balls and to the equilibrium price of tennis racquets?

Correct Answer
verified
The equilibrium pric...
View Answer

When quantity demanded decreases at every possible price, the demand curve has

Correct Answer
verified

Once the supply curve for a product or service is drawn, it

Correct Answer
verified

Consider the market for portable air conditioners in equilibrium. When a heat wave strikes the equilibrium price

Correct Answer
verified

Figure 4-24 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-24. All else equal, a large number of people becoming vegetarians would cause a move from

Correct Answer
verified

The law of supply states that, other things equal, an increase in

Correct Answer
verified

Figure 4-18 -Refer to Figure 4-18. At a price of $20, there would be a(n)

Correct Answer
verified

Table 4-6 -Refer to Table 4-6. Which supply schedules obey the law of supply?

Correct Answer
verified

The sum of all the individual supply curves for a product is called

Correct Answer
verified

Figure 4-5 -Refer to Figure 4-5. Which of the following would cause the demand curve to shift from Demand A to Demand B in the market for oranges in the United States?

Correct Answer
verified

A decrease in the number of sellers in the market causes

Correct Answer
verified

Figure 4-18 -Refer to Figure 4-18. At a price of $35, there would be a

Correct Answer
verified

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

Correct Answer
verified

Which of the following would most likely serve as an example of a monopoly?

Correct Answer
verified

A newspaper's classified ads are an example of a market.

Correct Answer
verified

New cars are normal goods. What will happen to the equilibrium price of new cars if the price of gasoline rises, the price of steel falls, public transportation becomes cheaper and more comfortable, auto-workers accept lower wages, and automobile insurance becomes more expensive?

Correct Answer
verified

Correct Answer
verified

Table 4-1 -Refer to Table 4-1. If the market consists of Michelle and Laura only and the price falls by $1, the quantity demanded in the market increases by

Correct Answer
verified

Exam 4: The Market Forces of Supply and Demand

Table 4-16 The following table shows the supply and demand schedules in a market. -Refer to Table 4-16. If the supply curve shifts to the right, will the price in this market rise or fall?

Correct AnswerverifiedThe price ...View AnswerShow Answer

Figure 4-14 -Refer to Figure 4-14. Which of the following best describes the movement from E1 to E2?

Correct AnswerverifiedShow Answer

If the supply of tennis balls, a complement to tennis racquets, decreases, what will happen to the equilibrium price of tennis balls and to the equilibrium price of tennis racquets?

Correct AnswerverifiedThe equilibrium pric...View AnswerShow Answer

When quantity demanded decreases at every possible price, the demand curve has

Correct AnswerverifiedShow Answer

Once the supply curve for a product or service is drawn, it

Correct AnswerverifiedShow Answer

Consider the market for portable air conditioners in equilibrium. When a heat wave strikes the equilibrium price

Correct AnswerverifiedShow Answer

Figure 4-24 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-24. All else equal, a large number of people becoming vegetarians would cause a move from

Correct AnswerverifiedShow Answer

The law of supply states that, other things equal, an increase in

Correct AnswerverifiedShow Answer

Figure 4-18 -Refer to Figure 4-18. At a price of $20, there would be a(n)

Correct AnswerverifiedShow Answer

Table 4-6 -Refer to Table 4-6. Which supply schedules obey the law of supply?

Correct AnswerverifiedShow Answer

The sum of all the individual supply curves for a product is called

Correct AnswerverifiedShow Answer

Figure 4-5 -Refer to Figure 4-5. Which of the following would cause the demand curve to shift from Demand A to Demand B in the market for oranges in the United States?

Correct AnswerverifiedShow Answer

A decrease in the number of sellers in the market causes

Correct AnswerverifiedShow Answer

Figure 4-18 -Refer to Figure 4-18. At a price of $35, there would be a

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Which of the following would most likely serve as an example of a monopoly?

Correct AnswerverifiedShow Answer

A newspaper's classified ads are an example of a market.

Correct AnswerverifiedShow Answer

New cars are normal goods. What will happen to the equilibrium price of new cars if the price of gasoline rises, the price of steel falls, public transportation becomes cheaper and more comfortable, auto-workers accept lower wages, and automobile insurance becomes more expensive?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Table 4-1 -Refer to Table 4-1. If the market consists of Michelle and Laura only and the price falls by $1, the quantity demanded in the market increases by

Correct AnswerverifiedShow Answer

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The price ...
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The equilibrium pric...
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