Question 1

Surpluses drive price up, while shortages drive price down.

Accepted Answer

A) True 
 B)False

Question 2

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 3

Sellers respond to a surplus by cutting their prices.

Accepted Answer

A) True 
 B)False

Question 4

When the price of peaches changes, the demand curve for peaches

Accepted Answer

A)   shifts because the price of peaches is measured on the vertical axis of the graph.
B)   shifts because the quantity demanded of peaches is measured on the horizontal axis of the graph.
C)   does not shift because the price of peaches is measured on the vertical axis of the graph.
D)   does not shift because the price of peaches is measured on the horizontal axis of the graph.E) A) and C)
F) B) and D)

Question 5

Which of the following would not shift the supply curve for mp3 players?

Accepted Answer

A)   an increase in the price of mp3 players
B)   a decrease in the number of sellers of mp3 players
C)   an increase in the price of plastic, an input into the production of mp3 players
D)   an improvement in the technology used to produce mp3 playersE) A) and B)
F) All of the above

Question 6

Suppose buyers of computers and printers regard the two goods as complements. Then an increase in the price of computers will cause a(n)

Accepted Answer

A)   decrease in the demand for printers and a decrease in the quantity supplied of printers.
B)   decrease in the supply of printers and a decrease in the quantity demanded of printers.
C)   decrease in the equilibrium price of printers and an increase in the equilibrium quantity of printers.
D)   increase in the equilibrium price of printers and a decrease in the equilibrium quantity of printers.E) A) and B)
F) None of the above

Question 7

When a surplus exists in a market, sellers

Accepted Answer

A)   raise price, which increases quantity demanded and decreases quantity supplied, until the surplus is eliminated.
B)   raise price, which decreases quantity demanded and increases quantity supplied, until the surplus is eliminated.
C)   lower price, which increases quantity demanded and decreases quantity supplied, until the surplus is eliminated.
D)   lower price, which decreases quantity demanded and increases quantity supplied, until the surplus is eliminated.E) All of the above
F) B) and C)

Question 8

Table 4-5
The table below shows the quantities demanded of cases of Mt. Dew per month by four families at various prices. 
-Refer to Table 4-5. Which of the following could cause all four families to demand more Mt. Dew at all prices?

Accepted Answer

A)   The price of sugar decreases.
B)   All four family incomes increase, and Mt. Dew is a normal good.
C)   A major university study reveals that drinking Mt. Dew can cause diabetes.
D)   The technology for bottling carbonated beverages improves.E) B) and C)
F) A) and D)

Question 9

Figure 4-25
The graph below pertains to the supply of paper to colleges and universities. 
-Refer to Figure 4-25. All else equal, the return of college students to campus in the fall would cause a move from

Accepted Answer

A)   x to y.
B)   y to x.
C)   SA to SB.
D)   SB to SA.E) A) and D)
F) B) and D)

Question 10

If the number of buyers in a market decreases, then

Accepted Answer

A)   demand will increase.
B)   demand will decrease.
C)   supply will increase.
D)   supply will decrease.E) B) and C)
F) None of the above

Question 11

A shortage is the same as an excess demand.

Accepted Answer

A) True 
 B)False

Question 12

Studies show that lower cigarette prices are associated with greater use of marijuana; therefore, tobacco and marijuana are

Accepted Answer

The answer of Studies show that lower cigarette prices are...

Question 13

A university's football stadium is never more than half-full during football games. This indicates

Accepted Answer

A)   the ticket price is above the equilibrium price.
B)   the ticket price is below the equilibrium price.
C)   the ticket price is at the equilibrium price.
D)   nothing about the equilibrium price.E) A) and C)
F) A) and D)

Question 14

Figure 4-24
The diagram below pertains to the demand for turkey in the United States. 
-Refer to Figure 4-24. 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) A) and C)
F) A) and D)

Question 15

Table 4-13
The demand schedule below pertains to sandwiches demanded per week. 
-Refer to Table 4-13. Suppose x = 1. Then it must be true that

Accepted Answer

A)   Harry and Jake have the same income, which is lower than Darby's income.
B)   if sandwiches and potato chips are complements for Harry, then those two goods are also complements for Jake.
C)   Harry's demand curve is identical to Jake's demand curve.
D)   All of the above are correct.E) A) and C)
F) B) and C)

Question 16

Funsters, Inc., the largest toy company in the country, sells its most popular doll for $15. It has just learned that its leading competitor, Toysorama, is mass-producing an excellent copy and plans to flood the market with their $5 doll in six weeks. Funsters should

Accepted Answer

A)   "fight fire with fire" by decreasing supply of its doll for six weeks and then increasing the supply.
B)   increase the supply of its doll now before the other doll hits the market.
C)   increase the price of its doll now.
D)   discontinue its doll.E) B) and C)
F) A) and D)

Question 17

If the supply of a product decreases, then we would expect equilibrium price

Accepted Answer

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

Question 18

If suppliers expect the price of their product to fall in the future, then they will

Accepted Answer

A)   decrease supply now.
B)   increase supply now.
C)   decrease supply in the future but not now.
D)   increase supply in the future but not now.E) B) and C)
F) A) and B)

Question 19

Table 4-12
A country club usually only allows members to purchase tickets for its celebrity golf tournament, but the club is considering allowing non-members to purchase tickets this year. The demand and supply schedules are as follows: 
-Refer to Table 4-12. If both members and non-members are allowed to purchase tickets to this year's celebrity golf tournament and the country club sets the ticket price at $20, then there will be

Accepted Answer

A)   a shortage of 300 tickets.
B)   a surplus of 300 tickets.
C)   300 tickets sold.
D)   600 tickets unsold.E) B) and C)
F) A) and D)

Question 20

When quantity supplied decreases at every possible price, we know that the supply curve has

Accepted Answer

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

Exam 4: The Market Forces of Supply and Demand

Studies show that lower cigarette prices are associated with greater use of marijuana; therefore, tobacco and marijuana are

Correct Answer
verified

Suppose buyers of computers and printers regard the two goods as complements. Then an increase in the price of computers will cause a(n)

Correct Answer
verified

A shortage is the same as an excess demand.

Correct Answer
verified

Surpluses drive price up, while shortages drive price down.

Correct Answer
verified

Table 4-5 The table below shows the quantities demanded of cases of Mt. Dew per month by four families at various prices. -Refer to Table 4-5. Which of the following could cause all four families to demand more Mt. Dew at all prices?

Correct Answer
verified

Figure 4-25 The graph below pertains to the supply of paper to colleges and universities. -Refer to Figure 4-25. All else equal, the return of college students to campus in the fall would cause a move from

Correct Answer
verified

A university's football stadium is never more than half-full during football games. This indicates

Correct Answer
verified

If suppliers expect the price of their product to fall in the future, then they will

Correct Answer
verified

Funsters, Inc., the largest toy company in the country, sells its most popular doll for $15. It has just learned that its leading competitor, Toysorama, is mass-producing an excellent copy and plans to flood the market with their $5 doll in six weeks. Funsters should

Correct Answer
verified

Sellers respond to a surplus by cutting their prices.

Correct Answer
verified

If the supply of a product decreases, then we would expect 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, the approach of Thanksgiving would cause a move from

Correct Answer
verified

When quantity supplied decreases at every possible price, we know that the supply curve has

Correct Answer
verified

Table 4-13 The demand schedule below pertains to sandwiches demanded per week. -Refer to Table 4-13. Suppose x = 1. Then it must be true that

Correct Answer
verified

When the price of peaches changes, the demand curve for peaches

Correct Answer
verified

If the number of buyers in a market decreases, then

Correct Answer
verified

Correct Answer
verified

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

Which of the following would not shift the supply curve for mp3 players?

Correct Answer
verified

When a surplus exists in a market, sellers

Correct Answer
verified

Exam 4: The Market Forces of Supply and Demand

Studies show that lower cigarette prices are associated with greater use of marijuana; therefore, tobacco and marijuana are

Correct AnswerverifiedShow Answer

Suppose buyers of computers and printers regard the two goods as complements. Then an increase in the price of computers will cause a(n)

Correct AnswerverifiedShow Answer

A shortage is the same as an excess demand.

Correct AnswerverifiedShow Answer

Surpluses drive price up, while shortages drive price down.

Correct AnswerverifiedShow Answer

Table 4-5 The table below shows the quantities demanded of cases of Mt. Dew per month by four families at various prices. -Refer to Table 4-5. Which of the following could cause all four families to demand more Mt. Dew at all prices?

Correct AnswerverifiedShow Answer

Figure 4-25 The graph below pertains to the supply of paper to colleges and universities. -Refer to Figure 4-25. All else equal, the return of college students to campus in the fall would cause a move from

Correct AnswerverifiedShow Answer

A university's football stadium is never more than half-full during football games. This indicates

Correct AnswerverifiedShow Answer

If suppliers expect the price of their product to fall in the future, then they will

Correct AnswerverifiedShow Answer

Funsters, Inc., the largest toy company in the country, sells its most popular doll for $15. It has just learned that its leading competitor, Toysorama, is mass-producing an excellent copy and plans to flood the market with their $5 doll in six weeks. Funsters should

Correct AnswerverifiedShow Answer

Sellers respond to a surplus by cutting their prices.

Correct AnswerverifiedShow Answer

If the supply of a product decreases, then we would expect 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, the approach of Thanksgiving would cause a move from

Correct AnswerverifiedShow Answer

When quantity supplied decreases at every possible price, we know that the supply curve has

Correct AnswerverifiedShow Answer

Table 4-13 The demand schedule below pertains to sandwiches demanded per week. -Refer to Table 4-13. Suppose x = 1. Then it must be true that

Correct AnswerverifiedShow Answer

When the price of peaches changes, the demand curve for peaches

Correct AnswerverifiedShow Answer

If the number of buyers in a market decreases, then

Correct AnswerverifiedShow Answer

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

Which of the following would not shift the supply curve for mp3 players?

Correct AnswerverifiedShow Answer

When a surplus exists in a market, sellers

Correct AnswerverifiedShow Answer

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The equilibrium pric...
View Answer

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Correct Answer
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