Question 1

An increase in demand will cause

Accepted Answer

A)  an increase in supply.
B)  a decrease in supply.
C)  an increase in quantity supplied.
D)  a decrease in quantity supplied.
E)  a decrease in equilibrium price.F) D) and E)
G) A) and C)

Question 2

A demand curve for concert tickets would show the

Accepted Answer

A)  number of tickets the box office is willing to sell at various prices.
B)  number of people who need tickets.
C)  quantity of people who want to buy these concert tickets.
D)  number of tickets that will be purchased at various prices.E) A) and B)
F) A) and D)

Question 3

If the supply of a good increased,what would be the effect on the equilibrium price and quantity?

Accepted Answer

A)  Price would increase and quantity would decrease.
B)  Price would decrease and quantity would decrease.
C)  Price would increase and quantity would increase.
D)  Price would decrease and quantity would increase.E) None of the above
F) B) and C)

Question 4

The price of chicken increases as the result of higher beef prices.This indicates that

Accepted Answer

A)  chicken and beef are substitutes.
B)  chicken and beef are complements.
C)  the market demand for beef is inelastic.
D)  the market demand for chicken is elastic.E) B) and C)
F) None of the above

Question 5

Other things constant,an increase in consumer income will

Accepted Answer

A)  shift the demand curve for automobiles to the left.
B)  shift the demand curve for automobiles to the right.
C)  cause a movement along the demand curve for automobiles,but it will not shift the demand curve.
D)  lead to a reduction in the supply of automobiles.E) None of the above
F) A) and B)

Question 6

Figure 3-23
 
-Refer to Figure 3-23.It is apparent from the figure that

Accepted Answer

A)  the good is inferior.
B)  the demand for the good decreases as income increases.
C)  the demand for the good conforms to the law of demand.
D)  All of the above are correct.E) B) and D)
F) None of the above

Question 7

Which of the following would most likely cause the demand for inkjet printers to decrease?

Accepted Answer

A)  a decrease in consumer income
B)  an increase in the price of laser printers,a substitute for inkjet printers
C)  a decrease in the price of printer paper used with inkjet printers
D)  a decrease in the price of inkjet printer cartridges used in inkjet printersE) None of the above
F) A) and B)

Question 8

Which of the following would most likely increase the demand for televisions?

Accepted Answer

A)  a decrease in the price of televisions
B)  a decline in consumer income
C)  a decrease in the price of home stereo systems,a substitute for televisions
D)  a decrease in the price of DVD players,a product that is complementary with televisionsE) B) and C)
F) A) and D)

Question 9

If Georgia experiences a late frost that damages the peach crop,we should expect the

Accepted Answer

A)  supply curve for peaches to shift to the right and the price of peaches to fall.
B)  supply curve for peaches to shift to the left and the price of peaches to rise.
C)  demand curve for peaches to shift to the left and the price of peaches to fall.
D)  demand curve for peaches to shift to the right and the price of peaches to rise.E) C) and D)
F) All of the above

Question 10

Suppose a major civil war broke out in an important oil-producing nation.What impact would this have on the market for oil?

Accepted Answer

A)  The supply of oil would fall.
B)  The supply of oil would rise.
C)  The demand for oil would fall.
D)  The demand for oil would rise.E) B) and C)
F) All of the above

Question 11

Figure 3-15
 
-Refer to Figure 3-15.Which area represents producer surplus when the price is P₂?

Accepted Answer

A)  BCE
B)  ACF
C)  ABED
D)  AFEBE) A) and B)
F) A) and C)

Question 12

Table 3-2
 
-Refer to Table 3-2.If the market price is $1,100,the combined total cost of all participating sellers is

Accepted Answer

A)  $3,700.
B)  $2,700.
C)  $2,250.
D)  $1,500.E) B) and C)
F) A) and D)

Question 13

Which of the following is true of the interaction of supply and demand?

Accepted Answer

A)  As the price increases,the quantity demanded and the quantity supplied will increase.
B)  As the price increases,the quantity demanded and the quantity supplied will decrease.
C)  As the price increases,the quantity demanded increases and the quantity supplied will decrease.
D)  As the price increases,the quantity demanded will decrease and the quantity supplied will increase.
E)  As the price increases,neither the quantity demanded nor quantity supplied will change.F) C) and E)
G) All of the above

Question 14

Which of the following will cause a decrease in the demand for peanut butter?

Accepted Answer

A)  an increase in the supply of peanut butter
B)  an increase in the price of peanut butter
C)  a doubling of the price of bread
D)  a drought in Georgia that destroyed 30 percent of the peanut crop
E)  an increase in consumer incomeF) C) and D)
G) A) and E)

Question 15

Two products that serve similar purposes for a consumer would be referred to as

Accepted Answer

A)  substitutes.
B)  complements.
C)  inferior goods.
D)  unrelated goods.E) A) and B)
F) A) and C)

Question 16

If the quantity of a good supplied is not very sensitive to the price of the good,economists say the supply of the good is relatively

Accepted Answer

A)  inelastic.
B)  elastic.
C)  robust.
D)  inverse.E) C) and D)
F) A) and C)

Question 17

In his book The Wealth of Nations,this famous economist argued that economic activity was directed by an "invisible hand."

Accepted Answer

A)  Alfred Marshall
B)  Milton Friedman
C)  Adam Smith
D)  David RicardoE) A) and C)
F) None of the above

Question 18

If the market price is above the equilibrium price,there will be a tendency for price to decrease,causing

Accepted Answer

A)  the quantity demanded to decrease and the quantity supplied to increase until they are equal.
B)  the quantity demanded to increase and the quantity supplied to decrease until they are equal.
C)  both quantity demanded and quantity supplied to decrease until they are equal.
D)  both quantity demanded and quantity supplied to increase until they are equal.E) C) and D)
F) B) and C)

Question 19

According to the law of supply,

Accepted Answer

A)  more of a good is desired by consumers as the price falls.
B)  less of a good is desired by consumers as the price rises.
C)  more of a good will be offered by suppliers as the price rises.
D)  less of a good will be offered by suppliers as the price rises.E) B) and C)
F) C) and D)

Question 20

Assume that corn and soybeans are alternatives that could be grown by most farmers.An increase in the price of corn will

Accepted Answer

A)  increase the supply of corn.
B)  increase the supply of soybeans.
C)  decrease the supply of soybeans.
D)  decrease the supply of corn.
E)  have no effect on the supplies of corn and soybeans.F) B) and E)
G) None of the above

Exam 3: Asupply,demand,and the Market Process

Figure 3-23 -Refer to Figure 3-23.It is apparent from the figure that

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Figure 3-15 -Refer to Figure 3-15.Which area represents producer surplus when the price is P₂?

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If the quantity of a good supplied is not very sensitive to the price of the good,economists say the supply of the good is relatively

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Which of the following would most likely increase the demand for televisions?

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Which of the following is true of the interaction of supply and demand?

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If the market price is above the equilibrium price,there will be a tendency for price to decrease,causing

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Table 3-2 -Refer to Table 3-2.If the market price is $1,100,the combined total cost of all participating sellers is

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Suppose a major civil war broke out in an important oil-producing nation.What impact would this have on the market for oil?

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Which of the following would most likely cause the demand for inkjet printers to decrease?

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Other things constant,an increase in consumer income will

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A demand curve for concert tickets would show the

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If Georgia experiences a late frost that damages the peach crop,we should expect the

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Assume that corn and soybeans are alternatives that could be grown by most farmers.An increase in the price of corn will

Correct AnswerverifiedShow Answer

Which of the following will cause a decrease in the demand for peanut butter?

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In his book The Wealth of Nations,this famous economist argued that economic activity was directed by an "invisible hand."

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An increase in demand will cause

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If the supply of a good increased,what would be the effect on the equilibrium price and quantity?

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Two products that serve similar purposes for a consumer would be referred to as

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The price of chicken increases as the result of higher beef prices.This indicates that

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According to the law of supply,

Correct AnswerverifiedShow Answer

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