Question 1

When it comes to people's tastes,economists generally believe that

Accepted Answer

A)   tastes are based on forces that are well within the realm of economics.
B)   tastes are based on historical and psychological forces that are beyond the realm of economics.
C)   tastes can only be studied through well-constructed,real-life models.
D)   because tastes do not directly affect demand,there is little need to explain people's tastes.E) A) and B)
F) A) and C)

Question 2

Currently you purchase ten frozen pizza per month.You will graduate from college in December,and you will start a new job in January.You have no plans to purchase frozen pizzas in January.For you,frozen pizzas are a(n)

Accepted Answer

A)   substitute good.
B)   normal good.
C)   inferior good.
D)   complementary good.E) A) and D)
F) All of the above

Question 3

If the demand for a good increases at the same time as the supply of the same good decreases,what will happen to the equilibrium price and quantity of the good?

Accepted Answer

The equilibrium pric...

Question 4

Figure 4-16 
-Refer to Figure 4-16.In this market,equilibrium price and quantity,respectively,are

Accepted Answer

A)   $10 and 30 units.
B)   $10 and 50 units.
C)   $10 and 70 units.
D)   $4 and 50 units.E) None of the above
F) A) and B)

Question 5

Whenever a determinant of supply other than price changes,the supply curve shifts.

Accepted Answer

A) True 
 B)False

Question 6

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

Accepted Answer

A) True 
 B)False

Question 7

Saddle shoes are not popular right now,so very few are being produced.If saddle shoes become popular,then how will this affect the market for saddle shoes?

Accepted Answer

A)   The supply curve for saddle shoes will shift right,which will create a shortage at the current price.Price will increase,which will decrease quantity demanded and increase quantity supplied.The new market equilibrium will be at a higher price and higher quantity.
B)   The supply curve for saddle shoes will shift right,which will create a surplus at the current price.Price will decrease,which will increase quantity demanded and decrease quantity supplied.The new market equilibrium will be at a lower price and higher quantity.
C)   The demand curve for saddle shoes will shift right,which will create a shortage at the current price.Price will increase,which will decrease quantity demanded and increase quantity supplied.The new market equilibrium will be at a higher price and higher quantity.
D)   The demand curve for saddle shoes will shift right,which will create a surplus at the current price.Price will decrease,which will increase quantity demanded and decrease quantity supplied.The new market equilibrium will be at a lower price and higher quantity.E) None of the above
F) A) and D)

Question 8

Figure 4-19
The diagram below pertains to the demand for turkey in the United States. A to DB. B)  DB to DA. C)  x to y. D)  y to x." class="answers-bank-image d-inline" rel="preload" >
-Refer to Figure 4-19.All else equal,the approach of Thanksgiving would cause a move from

Accepted Answer

A)   DA to DB.
B)   DB to DA.
C)   x to y.
D)   y to x.E) None of the above
F) A) and B)

Question 9

Figure 4-12  
-Refer to Figure 4-12.If Producer A and Producer B are the only producers in the market,then the market quantity supplied when the price is $4 is

Accepted Answer

A)   4 units.
B)   8 units.
C)   12 units.
D)   16 units.E) None of the above
F) B) and C)

Question 10

What will happen in the artichoke market now if buyers expect higher artichoke prices in the near future?

Accepted Answer

A)   The demand for artichokes will increase.
B)   The demand for artichokes will decrease.
C)   The demand for artichokes will be unaffected.
D)   The supply of artichokes will increase.E) B) and C)
F) All of the above

Question 11

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 $8 is

Accepted Answer

A)   14 units.
B)   15 units.
C)   16 units.
D)   29 units.E) B) and D)
F) None of the above

Question 12

If macaroni and cheese is an inferior good,what would happen to the equilibrium price and quantity of macaroni and cheese if consumers' incomes rise?

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) All of the above

Question 13

A competitive market is a market in which

Accepted Answer

A)   an auctioneer helps set prices and arrange sales.
B)   there are only a few sellers.
C)   the forces of supply and demand do not apply.
D)   no individual buyer or seller has any significant impact on the market price.E) All of the above
F) A) and D)

Question 14

Holding the nonprice determinants of demand constant,a change in price would

Accepted Answer

A)   result in either a decrease in demand or an increase in demand.
B)   result in a movement along a stationary demand curve.
C)   result in a shift of supply.
D)   have no effect on the quantity demanded.E) A) and B)
F) None of the above

Question 15

Supply refers to the position of the supply curve,whereas the quantity supplied refers to the amount suppliers wish to sell.

Accepted Answer

A) True 
 B)False

Question 16

Figure 4-21 
-Refer to Figure 4-21.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) None of the above
F) B) and C)

Question 17

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

Question 18

Which of the following events must cause equilibrium price to rise?

Accepted Answer

A)   demand increases and supply decreases
B)   demand and supply both decrease
C)   demand decreases and supply increases
D)   demand and supply both increaseE) All of the above
F) B) and C)

Question 19

Individual supply curves are summed vertically to obtain the market supply curve.

Accepted Answer

A) True 
 B)False

Question 20

Figure 4-20
The graph below pertains to the supply of paper to colleges and universities. A to SB. D)  SB to SA." class="answers-bank-image d-inline" rel="preload" >
-Refer to Figure 4-20.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) C) and D)
F) A) and B)

Exam 4: The Market Forces of Supply and Demand

If macaroni and cheese is an inferior good,what would happen to the equilibrium price and quantity of macaroni and cheese if consumers' incomes rise?

Correct AnswerverifiedShow Answer

Individual supply curves are summed vertically to obtain the market supply curve.

Correct AnswerverifiedShow Answer

Holding the nonprice determinants of demand constant,a change in price would

Correct AnswerverifiedShow Answer

Figure 4-12 -Refer to Figure 4-12.If Producer A and Producer B are the only producers in the market,then the market quantity supplied when the price is $4 is

Correct AnswerverifiedShow Answer

If the demand for a good increases at the same time as the supply of the same good decreases,what will happen to the equilibrium price and quantity of the good?

Correct AnswerverifiedThe equilibrium pric...View AnswerShow Answer

Currently you purchase ten frozen pizza per month.You will graduate from college in December,and you will start a new job in January.You have no plans to purchase frozen pizzas in January.For you,frozen pizzas are a(n)

Correct AnswerverifiedShow Answer

What will happen in the artichoke market now if buyers expect higher artichoke prices in the near future?

Correct AnswerverifiedShow Answer

Figure 4-16 -Refer to Figure 4-16.In this market,equilibrium price and quantity,respectively,are

Correct AnswerverifiedShow Answer

Figure 4-20 The graph below pertains to the supply of paper to colleges and universities. -Refer to Figure 4-20.All else equal,an increase in the use of laptop computers for note-taking would cause a move from

Correct AnswerverifiedShow Answer

Figure 4-21 -Refer to Figure 4-21.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?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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 $8 is

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Figure 4-19 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-19.All else equal,the approach of Thanksgiving would cause a move from

Correct AnswerverifiedShow Answer

Whenever a determinant of supply other than price changes,the supply curve shifts.

Correct AnswerverifiedShow Answer

Supply refers to the position of the supply curve,whereas the quantity supplied refers to the amount suppliers wish to sell.

Correct AnswerverifiedShow Answer

A competitive market is a market in which

Correct AnswerverifiedShow Answer

Saddle shoes are not popular right now,so very few are being produced.If saddle shoes become popular,then how will this affect the market for saddle shoes?

Correct AnswerverifiedShow Answer

Which of the following events must cause equilibrium price to rise?

Correct AnswerverifiedShow Answer

When it comes to people's tastes,economists generally believe that

Correct AnswerverifiedShow Answer

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The equilibrium pric...
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