Question 1

Most markets in the economy are

Accepted Answer

A)  markets in which sellers, rather than buyers, control the price of the product.
B)  markets in which buyers, rather than sellers, control the price of the product.
C)  perfectly competitive.
D)  highly competitive.E) C) and D)
F) B) and D)

Question 2

If baked potatoes and sour cream are complements, then an increase in the price of sour cream decreases the demand for baked potatoes.

Accepted Answer

A) True 
 B)False

Question 3

The quantity supplied of a good or service is the amount that sellers are willing and able to sell at a particular price.

Accepted Answer

A) True 
 B)False

Question 4

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

Question 5

If, at the current price, there is a surplus of a good, then

Accepted Answer

A)  sellers are producing more than buyers wish to buy.
B)  the market must be in equilibrium.
C)  the price is below the equilibrium price.
D)  quantity demanded equals quantity supplied.E) None of the above
F) C) and D)

Question 6

Figure 4-8 
-Refer to Figure 4-8. The movement from Point A to Point B represents a(n)

Accepted Answer

A)  increase in the price.
B)  decrease in the quantity supplied.
C)  shift in the supply curve.
D)  Both a)  and b)  are correct.E) A) and B)
F) B) and D)

Question 7

Demand refers to the amount buyers wish to buy, whereas the quantity demanded refers to the position of the demand curve.

Accepted Answer

A) True 
 B)False

Question 8

Figure 4-3
 
-Refer to Figure 4-3. If these are the only two consumers in the market, then the market quantity demanded at a price of $6 is

Accepted Answer

A)  12 units.
B)  14 units.
C)  19 units.
D)  21 units.E) B) and C)
F) C) and D)

Question 9

When the price of a good or service changes,

Accepted Answer

A)  the demand curve shifts in the opposite direction.
B)  the supply curve shifts in the opposite direction.
C)  the supply curve shifts in the same direction.
D)  there is a movement along a given supply curve.E) None of the above
F) B) and C)

Question 10

A demand schedule is a table that shows the relationship between

Accepted Answer

A)  quantity demanded and quantity supplied.
B)  income and quantity demanded.
C)  price and quantity demanded.
D)  price and income.E) B) and D)
F) None of the above

Question 11

If consumers view cappuccinos and lattés as substitutes, what would happen to the equilibrium price and quantity of lattés if the price of cappuccinos falls?

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) All of the above
F) B) and C)

Question 12

A higher price for batteries would result in a(n)

Accepted Answer

A)  increase in the demand for flashlights.
B)  decrease in the demand for flashlights.
C)  increase in the demand for batteries.
D)  decrease in the demand for batteries.E) B) and D)
F) B) and C)

Question 13

Figure 4-21 
-Refer to Figure 4-21. Which of the following movements would illustrate the effect in the market for paper napkins as a result of a "Go Green" advertising campaign encouraging people to use cloth napkins?

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

Question 14

Figure 4-17 
-Refer to Figure 4-17. If the price is $25, then there would be an excess

Accepted Answer

A)  supply of 100 units, and price would fall.
B)  supply of 300 units, and price would fall.
C)  demand of 100 units, and price would fall.
D)  demand of 300 units, and price would fall.E) None of the above
F) C) and D)

Question 15

Music compact discs are normal goods. What will happen to the equilibrium price and quantity of music compact discs if musicians accept lower royalties, compact disc players become cheaper, more firms start producing music compact discs, and music lovers experience an increase in income?

Accepted Answer

A)  Price will fall, and the effect on quantity is ambiguous.
B)  Price will rise, and the effect on quantity is ambiguous.
C)  Quantity will fall, and the effect on price is ambiguous.
D)  Quantity will rise, and the effect on price is ambiguous.E) B) and D)
F) B) and C)

Question 16

Table 4-8
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:
   Price  Quantity Denanded  by Members  Quantity Demanded  by Nan-members  Quantity Supplied $101000500600$15800400600$20600300600$25400200600$30200100600\begin{array} { | c | c | c | c } \hline 	ext { Price } & \begin{array} { c } 	ext { Quantity Denanded } \	ext { by Members }\end{array} & \begin{array} { c } 	ext { Quantity Demanded } \	ext { by Nan-members }\end{array} & 	ext { Quantity Supplied } \\hline \$ 10 & 1000 & 500 & 600 \\hline \$ 15 & 800 & 400 & 600 \\hline \$ 20 & 600 & 300 & 600 \\hline \$ 25 & 400 & 200 & 600 \\hline \$ 30 & 200 & 100 & 600 \\hline\end{array} Price $10$15$20$25$30​ Quantity Denanded  by Members ​1000800600400200​ Quantity Demanded  by Nan-members ​500400300200100​ Quantity Supplied 600600600600600​​ 
-Refer to Table 4-8. 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) None of the above
F) A) and D)

Question 17

A leftward 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) A) and D)
F) C) and D)

Question 18

Figure 4-15 
-Refer to Figure 4-15. At a price of $20, there would be a(n)

Accepted Answer

A)  shortage. The law of supply and demand predicts that the price will fall from $20 to a lower price.
B)  surplus. The law of supply and demand predicts that the price will rise from $20 to a higher price.
C)  excess demand. The law of supply and demand predicts that the price will rise from $20 to a higher price.
D)  excess supply. The law of supply and demand predicts that the price will fall from $20 to a lower price.E) B) and C)
F) A) and D)

Question 19

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 $6 is

Accepted Answer

A)  2 units.
B)  10 units.
C)  12 units.
D)  22 units.E) None of the above
F) A) and D)

Question 20

Which of the following is an example of a market?

Accepted Answer

A)  a gas station
B)  a garage sale
C)  a barber shop
D)  All of the above are examples of markets.E) C) and D)
F) None of the above

Exam 4: The Market Forces of Supply and Demand

Which of the following is an example of a market?

Correct Answer
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If, at the current price, there is a surplus of a good, then

Correct Answer
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Figure 4-8 -Refer to Figure 4-8. The movement from Point A to Point B represents a(n)

Correct Answer
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Music compact discs are normal goods. What will happen to the equilibrium price and quantity of music compact discs if musicians accept lower royalties, compact disc players become cheaper, more firms start producing music compact discs, and music lovers experience an increase in income?

Correct Answer
verified

The quantity supplied of a good or service is the amount that sellers are willing and able to sell at a particular price.

Correct Answer
verified

Demand refers to the amount buyers wish to buy, whereas the quantity demanded refers to the position of the demand curve.

Correct Answer
verified

Most markets in the economy are

Correct Answer
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When the price of a good or service changes,

Correct Answer
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If consumers view cappuccinos and lattés as substitutes, what would happen to the equilibrium price and quantity of lattés if the price of cappuccinos falls?

Correct Answer
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Figure 4-17 -Refer to Figure 4-17. If the price is $25, then there would be an excess

Correct Answer
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Correct Answer
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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 $6 is

Correct Answer
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Figure 4-3 -Refer to Figure 4-3. If these are the only two consumers in the market, then the market quantity demanded at a price of $6 is

Correct Answer
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A demand schedule is a table that shows the relationship between

Correct Answer
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If the number of buyers in a market decreases, then

Correct Answer
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A higher price for batteries would result in a(n)

Correct Answer
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A leftward shift of a demand curve is called a(n)

Correct Answer
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Figure 4-15 -Refer to Figure 4-15. At a price of $20, there would be a(n)

Correct Answer
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Figure 4-21 -Refer to Figure 4-21. Which of the following movements would illustrate the effect in the market for paper napkins as a result of a "Go Green" advertising campaign encouraging people to use cloth napkins?

Correct Answer
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If baked potatoes and sour cream are complements, then an increase in the price of sour cream decreases the demand for baked potatoes.

Correct Answer
verified

Exam 4: The Market Forces of Supply and Demand

Which of the following is an example of a market?

Correct AnswerverifiedShow Answer

If, at the current price, there is a surplus of a good, then

Correct AnswerverifiedShow Answer

Figure 4-8 -Refer to Figure 4-8. The movement from Point A to Point B represents a(n)

Correct AnswerverifiedShow Answer

Music compact discs are normal goods. What will happen to the equilibrium price and quantity of music compact discs if musicians accept lower royalties, compact disc players become cheaper, more firms start producing music compact discs, and music lovers experience an increase in income?

Correct AnswerverifiedShow Answer

The quantity supplied of a good or service is the amount that sellers are willing and able to sell at a particular price.

Correct AnswerverifiedShow Answer

Demand refers to the amount buyers wish to buy, whereas the quantity demanded refers to the position of the demand curve.

Correct AnswerverifiedShow Answer

Most markets in the economy are

Correct AnswerverifiedShow Answer

When the price of a good or service changes,

Correct AnswerverifiedShow Answer

If consumers view cappuccinos and lattés as substitutes, what would happen to the equilibrium price and quantity of lattés if the price of cappuccinos falls?

Correct AnswerverifiedShow Answer

Figure 4-17 -Refer to Figure 4-17. If the price is $25, then there would be an excess

Correct AnswerverifiedShow Answer

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 $6 is

Correct AnswerverifiedShow Answer

Figure 4-3 -Refer to Figure 4-3. If these are the only two consumers in the market, then the market quantity demanded at a price of $6 is

Correct AnswerverifiedShow Answer

A demand schedule is a table that shows the relationship between

Correct AnswerverifiedShow Answer

If the number of buyers in a market decreases, then

Correct AnswerverifiedShow Answer

A higher price for batteries would result in a(n)

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Figure 4-15 -Refer to Figure 4-15. At a price of $20, there would be a(n)

Correct AnswerverifiedShow Answer

Figure 4-21 -Refer to Figure 4-21. Which of the following movements would illustrate the effect in the market for paper napkins as a result of a "Go Green" advertising campaign encouraging people to use cloth napkins?

Correct AnswerverifiedShow Answer

If baked potatoes and sour cream are complements, then an increase in the price of sour cream decreases the demand for baked potatoes.

Correct AnswerverifiedShow Answer

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