Question 1

Refer to Figure 4-28. Using the points on the figure, describe the change that would occur if a news report stated that the price of this good was expected to increase next week.

Accepted Answer

The answer of Refer to Figure 4-28. Using the points...

Question 2

Figure 4-20 
-Refer to Figure 4-20. At a price of $15,

Accepted Answer

A)   quantity demanded exceeds quantity supplied.
B)   there is a shortage.
C)   there is an excess demand.
D)   All of the above are correct.E) B) and D)
F) None of the above

Question 3

The current price of blue jeans is $30 per pair, but the equilibrium price of blue jeans is $25 per pair. As a result,

Accepted Answer

A)   the quantity supplied of blue jeans exceeds the quantity demanded of blue jeans at the $30 price.
B)   the equilibrium quantity of blue jeans exceeds the quantity demanded at the $30 price.
C)   there is a surplus of blue jeans at the $30 price.
D)   All of the above are correct.E) B) and C)
F) A) and B)

Question 4

The term price takers refers to buyers and sellers in

Accepted Answer

A)   perfectly competitive markets.
B)   monopolistic markets.
C)   markets that are regulated by the government.
D)   markets in which buyers cannot buy all they want and/or sellers cannot sell all they want.E) A) and D)
F) C) and D)

Question 5

Figure 4-26 
-Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for orange juice of an announcement by the American Dental Association that orange juice erodes tooth enamel?

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

Question 6

Monopolists are price takers.

Accepted Answer

A) True 
 B)False

Question 7

Figure 4-10 
-Refer to Figure 4-10. The movement from Point A to Point B represents an)

Accepted Answer

A)   shift in the supply curve.
B)   decrease in the quantity supplied.
C)   increase in the quantity supplied.
D)   Both a and b are correct.E) C) and D)
F) A) and B)

Question 8

The law of supply states that, other things equal, when the price of a good

Accepted Answer

A)   falls, the supply of the good rises.
B)   rises, the quantity supplied of the good rises.
C)   rises, the supply of the good falls.
D)   falls, the quantity supplied of the good rises.E) All of the above
F) C) and D)

Question 9

A group of buyers and sellers of a particular good or service is called a

Accepted Answer

The answer of A group of buyers and sellers of...

Question 10

Which of the following events must result in a higher price in the market for cigars?

Accepted Answer

A)   Demand for cigars increases, and supply of cigars decreases.
B)   Demand for cigars and supply of cigars both decrease.
C)   Demand for cigars decreases, and supply of cigars increases.
D)   Demand for cigars and supply of cigars both increaseE) B) and C)
F) A) and D)

Question 11

Table 4-2
 
-Refer to Table 4-2. Whose demand does not obey the law of demand?

Accepted Answer

A)   Abby's
B)   Brandi's
C)   Carrie's
D)   DeeDee'sE) A) and B)
F) B) and C)

Question 12

A downward-sloping demand curve illustrates

Accepted Answer

A)   that demand decreases over time.
B)   that prices fall over time.
C)   the relationship between income and quantity demanded.
D)   the law of demand.E) B) and D)
F) A) and D)

Question 13

What will happen to the equilibrium price of new textbooks if more students attend college, paper becomes cheaper, textbook authors accept lower royalties, and fewer used textbooks are sold?

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

Question 14

Figure 4-4
Yasmine Mercedes
  
-Refer to Figure 4-4. If Yasmine and Mercedes are the only two consumers in the market, then the market quantity demanded at a price of $12 is

Accepted Answer

A)   3 units.
B)   6 units.
C)   9 units.
D)   12 units.E) A) and C)
F) None of the above

Question 15

An increase in the price of cotton will increase the equilibrium price and decrease the equilibrium quantity in the market for cotton t-shirts.

Accepted Answer

A) True 
 B)False

Question 16

The following table contains a supply schedule for a good.  If the law of supply applies to this good, then Q1 could be

Accepted Answer

A)   0.
B)   50.
C)   100.
D)   150.E) A) and C)
F) A) and D)

Question 17

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

Question 18

The demand for a good or service is determined by

Accepted Answer

A)   those who buy the good or service.
B)   the government.
C)   those who sell the good or service.
D)   both those who buy and those who sell the good or service.E) None of the above
F) A) and D)

Question 19

Today, producers changed their expectations about the future. This change

Accepted Answer

A)   can cause a movement along a supply curve.
B)   can affect future supply, but not today's supply.
C)   can affect today's supply.
D)   cannot affect either today's supply or future supply.E) None of the above
F) C) and D)

Question 20

Two goods are substitutes when a decrease in the price of one good

Accepted Answer

A)   decreases the demand for the other good.
B)   decreases the quantity demanded of the other good.
C)   increases the demand for the other good.
D)   increases the quantity demanded of the other good.E) A) and C)
F) B) and D)

Exam 4: The Market Forces of Supply and Demand

A group of buyers and sellers of a particular good or service is called a

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An increase in the price of cotton will increase the equilibrium price and decrease the equilibrium quantity in the market for cotton t-shirts.

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The term price takers refers to buyers and sellers in

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Figure 4-20 -Refer to Figure 4-20. At a price of $15,

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Today, producers changed their expectations about the future. This change

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Monopolists are price takers.

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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 falls?

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Figure 4-4 Yasmine Mercedes -Refer to Figure 4-4. If Yasmine and Mercedes are the only two consumers in the market, then the market quantity demanded at a price of $12 is

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The current price of blue jeans is $30 per pair, but the equilibrium price of blue jeans is $25 per pair. As a result,

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Table 4-2 -Refer to Table 4-2. Whose demand does not obey the law of demand?

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The law of supply states that, other things equal, when the price of a good

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The demand for a good or service is determined by

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The following table contains a supply schedule for a good. If the law of supply applies to this good, then Q1 could be

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What will happen to the equilibrium price of new textbooks if more students attend college, paper becomes cheaper, textbook authors accept lower royalties, and fewer used textbooks are sold?

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Two goods are substitutes when a decrease in the price of one good

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Which of the following events must result in a higher price in the market for cigars?

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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 orange juice of an announcement by the American Dental Association that orange juice erodes tooth enamel?

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Figure 4-10 -Refer to Figure 4-10. The movement from Point A to Point B represents an)

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A downward-sloping demand curve illustrates

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Refer to Figure 4-28. Using the points on the figure, describe the change that would occur if a news report stated that the price of this good was expected to increase next week.

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