Question 1

If consumers often purchase muffins to eat while they drink their lattés at local coffee shops,what would happen to the equilibrium price and quantity of lattés if the price of muffins rises?

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 D)
F) All of the above

Question 2

Suppose scientists provide evidence that chocolate pudding increases the bad cholesterol levels of those who eat it.We would expect to see

Accepted Answer

A)   no change in the demand for chocolate pudding.
B)   a decrease in the demand for chocolate pudding.
C)   an increase in the demand for chocolate pudding.
D)   a decrease in the supply of chocolate pudding.E) B) and D)
F) B) and C)

Question 3

Equilibrium price must increase when demand

Accepted Answer

A)   increases and supply does not change,when demand does not change and supply decreases,and when demand decreases and supply increases simultaneously.
B)   increases and supply does not change,when demand does not change and supply decreases,and when demand increases and supply decreases simultaneously.
C)   decreases and supply does not change,when demand does not change and supply increases,and when demand decreases and supply increases simultaneously.
D)   decreases and supply does not change,when demand does not change and supply increases,and when demand increases and supply decreases simultaneously.E) B) and D)
F) B) and C)

Question 4

An increase in the number of college scholarships issued by private foundations would

Accepted Answer

A)   increase the supply of education.
B)   decrease the supply of education.
C)   increase the demand for education.
D)   decrease the demand for education.E) A) and B)
F) A) and C)

Question 5

The difference between a supply schedule and a supply curve is that a supply schedule

Accepted Answer

A)   incorporates demand and a supply curve does not.
B)   incorporates profit and a supply curve does not.
C)   can shift,but a supply curve cannot shift.
D)   is a table,and a supply curve is drawn on a graph.E) None of the above
F) A) and B)

Question 6

Which of the following is not a characteristic of a perfectly competitive market?

Accepted Answer

A)   Different sellers sell identical products.
B)   There are many sellers.
C)   Sellers must accept the price the market determines.
D)   All of the above are characteristics of a perfectly competitive market.E) A) and B)
F) A) and C)

Question 7

The equilibrium price is the same as the market-clearing price.

Accepted Answer

A) True 
 B)False

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) All of the above
F) A) and D)

Question 9

Individual demand curves are summed horizontally to obtain the market demand curve.

Accepted Answer

A) True 
 B)False

Question 10

In a perfectly competitive market,at the market price,buyers

Accepted Answer

A)   cannot buy all they want,and sellers cannot sell all they want.
B)   cannot buy all they want,but sellers can sell all they want.
C)   can buy all they want,but sellers cannot sell all they want.
D)   can buy all they want,and sellers can sell all they want.E) A) and B)
F) B) and D)

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 $4 is

Accepted Answer

A)   6 units.
B)   7 units.
C)   8 units.
D)   14 units.E) None of the above
F) All of the above

Question 12

An example of a perfectly competitive market would be the

Accepted Answer

A)   cable TV market.
B)   soybean market.
C)   breakfast cereal market.
D)   shampoo market.E) C) and D)
F) All of the above

Question 13

Which of the following events could cause an increase in the supply of ceiling fans?

Accepted Answer

A)   The number of sellers of ceiling fans increases.
B)   There is an increase in the price of air conditioners,and consumers regard air conditioners and ceiling fans as substitutes.
C)   There is an increase in the price of the motor that powers ceiling fans.
D)   All of the above are correct.E) All of the above
F) A) and B)

Question 14

Sellers respond to a shortage by cutting their prices.

Accepted Answer

A) True 
 B)False

Question 15

A improvement in production technology will shift the

Accepted Answer

A)   supply curve to the right.
B)   supply curve to the left.
C)   demand curve to the right.
D)   demand curve to the left.E) B) and C)
F) A) and D)

Question 16

Figure 4-13 
-Refer to Figure 4-13.The shift from S to S' could be caused by an

Accepted Answer

A)   increase in the price of the good.
B)   improvement in production technology.
C)   increase in income.
D)   increase in input prices.E) A) and B)
F) A) and D)

Question 17

The quantity demanded of a product is the amount that buyers are willing and able to purchase at a particular price.

Accepted Answer

A) True 
 B)False

Question 18

Table 4-1
 
-Refer to Table 4-1.If the market consists of Michelle,Laura,and Hillary 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 C)
F) C) and D)

Question 19

Which of the following sets of events must cause an increase in the price of a new house?

Accepted Answer

A)   higher wages for carpenters,higher wood prices,increases in consumer incomes,higher apartment rents,increases in population,and expectations of higher house prices in the future
B)   lower wages for carpenters,lower wood prices,increases in consumer incomes,higher apartment rents,increases in population and expectations of higher house prices in the future
C)   lower wages for carpenters,higher wood prices,decreases in consumer incomes,higher apartment rents,decreases in population and expectations of higher house prices in the future
D)   higher wages for carpenters,lower wood prices,decreases in consumer incomes,lower apartment rents,decreases in population and expectations of lower house prices in the futureE) A) and B)
F) A) and C)

Question 20

Table 4-3
 
-Refer to Table 4-3.If these are the only four buyers in the market,then the market quantity demanded at a price of $2 is

Accepted Answer

A)   0 units.
B)   3.5 units.
C)   12 units.
D)   14 units.E) None of the above
F) All of the above

Exam 4: The Market Forces of Supply and Demand

Table 4-3 -Refer to Table 4-3.If these are the only four buyers in the market,then the market quantity demanded at a price of $2 is

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Sellers respond to a shortage by cutting their prices.

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The quantity demanded of a product is the amount that buyers are willing and able to purchase at a particular price.

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Suppose scientists provide evidence that chocolate pudding increases the bad cholesterol levels of those who eat it.We would expect to see

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A improvement in production technology will shift the

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Equilibrium price must increase when demand

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An increase in the number of college scholarships issued by private foundations would

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If consumers often purchase muffins to eat while they drink their lattés at local coffee shops,what would happen to the equilibrium price and quantity of lattés if the price of muffins rises?

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

Correct AnswerverifiedShow Answer

Which of the following sets of events must cause an increase in the price of a new house?

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The difference between a supply schedule and a supply curve is that a supply schedule

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The equilibrium price is the same as the market-clearing price.

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Individual demand curves are summed horizontally to obtain the market demand curve.

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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 $4 is

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Which of the following events could cause an increase in the supply of ceiling fans?

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Which of the following is not a characteristic of a perfectly competitive market?

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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

Figure 4-13 -Refer to Figure 4-13.The shift from S to S' could be caused by an

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In a perfectly competitive market,at the market price,buyers

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An example of a perfectly competitive market would be the

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