Question 1

Which of the following is a determinant of supply?

Accepted Answer

A)  Consumer tastes or preferences.
B)  The prices of the factors of production.
C)  Income.
D)  Number of buyers.E) A) and D)
F) B) and D)

Question 2

If a price is below equilibrium,

Accepted Answer

A)  A shortage will cause the price to fall and the quantity supplied to decrease.
B)  A shortage will cause the price to rise and the quantity supplied to increase.
C)  A surplus will cause the price to fall and the quantity supplied to decrease.
D)  A surplus will cause the price to fall and the quantity supplied to increase.E) All of the above
F) B) and D)

Question 3

If a price ceiling is to be binding or effective,it should be set

Accepted Answer

A)  Below the equilibrium price,and it will create a market shortage.
B)  Below the equilibrium price,and it will create a market surplus.
C)  Above the equilibrium price,and it will create a market shortage.
D)  Above the equilibrium price,and it will create a market surplus.E) A) and B)
F) None of the above

Question 4

Scalping is likely to appear when a price is set below equilibrium price by the seller.
Scalpers will make a profit when they buy a product at a price below the equilibrium price and sell it at a higher price.So if a market price is set below equilibrium price,profit potential exists,which encourages scalping.

Accepted Answer

A) True 
 B)False

Question 5

Ceteris paribus,an increase in the number of sellers of running shoes causes equilibrium price to

Accepted Answer

A)  Decrease and equilibrium quantity to increase.
B)  Decrease and equilibrium quantity to decrease.
C)  Increase and equilibrium quantity to increase.
D)  Increase and equilibrium quantity to decrease.E) A) and B)
F) A) and C)

Question 6

To calculate market demand,we

Accepted Answer

A)  Add the quantities demanded for each individual demand schedule horizontally.
B)  Add the quantities demanded for each individual demand schedule vertically.
C)  Find the average quantity demanded at each price.
D)  Find the difference between the quantity demanded and the quantity supplied at each price.E) A) and B)
F) None of the above

Question 7

A buyer is said to have a demand for a good only when

Accepted Answer

A)  The buyer wants to own the good.
B)  The buyer is both willing and able to purchase the good at alternative prices.
C)  The price of the good is low enough.
D)  An adequate supply of the good is available for purchase.E) B) and D)
F) B) and C)

Question 8

A change in price changes the quantity demanded and is represented by a movement along the demand curve.
Movements along a demand curve are a response to price changes for that good.Shifts of the demand curve occur when the determinants of demand change.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following statements about markets is not true?

Accepted Answer

A)  Markets necessarily have a physical location.
B)  Markets have both a demand side and a supply side.
C)  The two types of markets include the factor and product markets.
D)  Every market transaction involves an exchange of money for goods or resources or a direct exchange of goods or resources without money called barter.E) A) and B)
F) None of the above

Question 10

Money is critical in facilitating market exchanges and the specialization that these exchanges permit.
Every market transaction involves an exchange of dollars for goods or resources.

Accepted Answer

A) True 
 B)False

Question 11

If the wages of corn farmers decrease,then the

Accepted Answer

A)  Supply curve for corn will shift right.
B)  Supply curve for corn will shift left.
C)  Demand curve for corn will shift left.
D)  None of the choices are correct.E) C) and D)
F) A) and C)

Question 12

The supply curve shifts to the right when a seller sells a good.
The market supply curve is a summary of the supply intentions of all producers.

Accepted Answer

A) True 
 B)False

Question 13

When economists talk about "optimal outcomes" in the marketplace,they mean that

Accepted Answer

A)  The allocation of resources by the market is perfect.
B)  All the consumer desires are satisfied and business profits are maximized.
C)  The allocation of resources by the market is likely to be the best possible,given scarce resources and income constraints.
D)  Everyone who wants a good or service can have it.E) A) and B)
F) B) and C)

Question 14

Ceteris paribus,if the subsidies given to corn syrup producers decrease,then we can expect

Accepted Answer

A)  A decrease in the demand for corn syrup.
B)  A decrease in the supply of corn syrup.
C)  An increase in the demand for corn syrup.
D)  An increase in the supply of corn syrup.E) A) and B)
F) None of the above

Question 15

Suppose both the demand for and supply of salsa increase (although not necessarily by the same amount) .What can we conclude about changes in the price and quantity of salsa?

Accepted Answer

A)  Both the price and quantity increase.
B)  The price increases but the change in the quantity cannot be determined.
C)  The quantity increases but the change in the price cannot be determined.
D)  Both the price and quantity decrease.E) C) and D)
F) A) and C)

Question 16

The goal of the business firms in a market economy is to maximize

Accepted Answer

A)  Total profits.
B)  Total sales.
C)  Total utility.
D)  Total welfare.E) A) and D)
F) B) and C)

Question 17

Jessie's demand schedule for candy bars indicates

Accepted Answer

A)  Her opportunity cost of buying candy bars.
B)  How much she likes candy bars.
C)  How many candy bars she will actually buy.
D)  Why she likes candy bars.E) None of the above
F) All of the above

Question 18

Which determinant of demand changes in the personal computer market as more individuals become interested in "surfing the Internet"?

Accepted Answer

A)  Cost of factors of production.
B)  Income.
C)  Expectations.
D)  Number of buyers.E) All of the above
F) None of the above

Question 19

Define the law of demand and explain how this relates to typical human behavior.

Accepted Answer

The law of demand says that the quantity...

Question 20

If the actual market price were fixed at $15 per unit in Figure 3.2,  Figure 3.2 Supply and Demand

Accepted Answer

A)  There would be a surplus of 40 units.
B)  There would be a surplus of 20 units.
C)  There would be a shortage of 40 units.
D)  There would be a shortage of 20 units.E) A) and B)
F) B) and C)

Exam 3: Supply and Demand

Define the law of demand and explain how this relates to typical human behavior.

Correct Answer
verified
The law of demand says that the quantity...
View Answer

Jessie's demand schedule for candy bars indicates

Correct Answer
verified

If the actual market price were fixed at $15 per unit in Figure 3.2, Figure 3.2 Supply and Demand

Correct Answer
verified

If a price ceiling is to be binding or effective,it should be set

Correct Answer
verified

A change in price changes the quantity demanded and is represented by a movement along the demand curve. Movements along a demand curve are a response to price changes for that good.Shifts of the demand curve occur when the determinants of demand change.

Correct Answer
verified

To calculate market demand,we

Correct Answer
verified

Money is critical in facilitating market exchanges and the specialization that these exchanges permit. Every market transaction involves an exchange of dollars for goods or resources.

Correct Answer
verified

If a price is below equilibrium,

Correct Answer
verified

The goal of the business firms in a market economy is to maximize

Correct Answer
verified

If the wages of corn farmers decrease,then the

Correct Answer
verified

Which determinant of demand changes in the personal computer market as more individuals become interested in "surfing the Internet"?

Correct Answer
verified

Correct Answer
verified

Which of the following is a determinant of supply?

Correct Answer
verified

When economists talk about "optimal outcomes" in the marketplace,they mean that

Correct Answer
verified

Which of the following statements about markets is not true?

Correct Answer
verified

Ceteris paribus,if the subsidies given to corn syrup producers decrease,then we can expect

Correct Answer
verified

A buyer is said to have a demand for a good only when

Correct Answer
verified

The supply curve shifts to the right when a seller sells a good. The market supply curve is a summary of the supply intentions of all producers.

Correct Answer
verified

Ceteris paribus,an increase in the number of sellers of running shoes causes equilibrium price to

Correct Answer
verified

Suppose both the demand for and supply of salsa increase (although not necessarily by the same amount) .What can we conclude about changes in the price and quantity of salsa?

Correct Answer
verified

Exam 3: Supply and Demand

Define the law of demand and explain how this relates to typical human behavior.

Correct AnswerverifiedThe law of demand says that the quantity...View AnswerShow Answer

Jessie's demand schedule for candy bars indicates

Correct AnswerverifiedShow Answer

If the actual market price were fixed at $15 per unit in Figure 3.2, Figure 3.2 Supply and Demand

Correct AnswerverifiedShow Answer

If a price ceiling is to be binding or effective,it should be set

Correct AnswerverifiedShow Answer

A change in price changes the quantity demanded and is represented by a movement along the demand curve. Movements along a demand curve are a response to price changes for that good.Shifts of the demand curve occur when the determinants of demand change.

Correct AnswerverifiedShow Answer

To calculate market demand,we

Correct AnswerverifiedShow Answer

Money is critical in facilitating market exchanges and the specialization that these exchanges permit. Every market transaction involves an exchange of dollars for goods or resources.

Correct AnswerverifiedShow Answer

If a price is below equilibrium,

Correct AnswerverifiedShow Answer

The goal of the business firms in a market economy is to maximize

Correct AnswerverifiedShow Answer

If the wages of corn farmers decrease,then the

Correct AnswerverifiedShow Answer

Which determinant of demand changes in the personal computer market as more individuals become interested in "surfing the Internet"?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following is a determinant of supply?

Correct AnswerverifiedShow Answer

When economists talk about "optimal outcomes" in the marketplace,they mean that

Correct AnswerverifiedShow Answer

Which of the following statements about markets is not true?

Correct AnswerverifiedShow Answer

Ceteris paribus,if the subsidies given to corn syrup producers decrease,then we can expect

Correct AnswerverifiedShow Answer

A buyer is said to have a demand for a good only when

Correct AnswerverifiedShow Answer

The supply curve shifts to the right when a seller sells a good. The market supply curve is a summary of the supply intentions of all producers.

Correct AnswerverifiedShow Answer

Ceteris paribus,an increase in the number of sellers of running shoes causes equilibrium price to

Correct AnswerverifiedShow Answer

Suppose both the demand for and supply of salsa increase (although not necessarily by the same amount) .What can we conclude about changes in the price and quantity of salsa?

Correct AnswerverifiedShow Answer

Correct Answer
verified
The law of demand says that the quantity...
View Answer

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