Question 1

Recent forest fires in the western states are expected to cause the price of lumber to rise in the next six months. As a result, we can expect the supply of lumber to

Accepted Answer

A)   fall in six months but not now.
B)   increase in six months when the price goes up.
C)   fall now.
D)   increase now to meet as much demand as possible.E) C) and D)
F) None of the above

Question 2

An increase in the price of ink will shift the supply curve for pens to the left.

Accepted Answer

A) True 
 B)False

Question 3

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 D)

Question 4

Figure 4-13
 
-Refer to Figure 4-13. The shift from S to S' is called a(n)

Accepted Answer

A)   decrease in supply.
B)   decrease in quantity supplied.
C)   increase in supply.
D)   increase in quantity supplied.E) A) and B)
F) All of the above

Question 5

Figure 4-18
 
-Refer to Figure 4-18. At a price of $4, there is a

Accepted Answer

A)   surplus of 3 units.
B)   surplus of 6 units.
C)   shortage of 3 units.
D)   shortage of 6 units.E) A) and B)
F) A) and C)

Question 6

Table 4-2
 
-Refer to Table 4-2. If these are the only four buyers in the market, then when the price decreases from $6 to $4, the market quantity demanded

Accepted Answer

A)   increases by 0.75 units.
B)   increases by 3 units.
C)   increases by 8 units.
D)   decreases by 27 units.E) C) and D)
F) B) and C)

Question 7

An increase in the price of a good will

Accepted Answer

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

Question 8

If a firm is a price taker, it operates in a

Accepted Answer

A)   competitive market.
B)   monopoly market.
C)   oligopoly market.
D)   monopolistically competitive market.E) A) and D)
F) All of the above

Question 9

A decrease in income will shift the demand curve for an inferior good to the right.

Accepted Answer

A) True 
 B)False

Question 10

Supply refers to the position of the supply curve, whereas the quantity supplied refers to the amount suppliers wish to sell.

Accepted Answer

A) True 
 B)False

Question 11

An increase in the price of oranges would lead to

Accepted Answer

A)   an increased supply of oranges.
B)   a reduction in the prices of inputs used in orange production.
C)   an increased demand for oranges.
D)   a movement up and to the right along the supply curve for oranges.E) A) and C)
F) B) and C)

Question 12

A market is a group of buyers and sellers of a particular good or service.

Accepted Answer

A) True 
 B)False

Question 13

In a perfectly competitive market, the goods offered for sale are all exactly the same.

Accepted Answer

A) True 
 B)False

Question 14

When Mario's income decreases, he buys more pasta. For Mario, pasta is a normal good.

Accepted Answer

A) True 
 B)False

Question 15

When all market participants are price takers who have no influence over prices, the markets have

Accepted Answer

A)   only a few buyers and sellers.
B)   numerous sellers but only a few buyers.
C)   numerous buyers but only a few sellers.
D)   numerous buyers and sellers.E) A) and B)
F) B) and C)

Question 16

Suppose Spencer and Kate are the only two demanders of lemonade. Each month, Spencer buys six glasses of lemonade when the price is $1.00 per glass, and he buys four glasses when the price is $1.50 per glass. Each month, Kate buys four glasses of lemonade when the price is $1.00 per glass, and she buys two glasses when the price is $1.50 per glass. Which of the following points is on the market demand curve? Point
Price
Quantity
A
$1) 00
4
B
$1) 00
10
C
$1) 50
2
D
$1) 50
6

Accepted Answer

A)   B only
B)   B and D only
C)   A and C only
D)   D onlyE) A) and B)
F) C) and D)

Question 17

Supply and demand together determine the price and quantity of a good sold in a market.

Accepted Answer

A) True 
 B)False

Question 18

When quantity supplied increases 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)

Question 19

Table 4-5
 
-Refer to Table 4-5. If these are the only four sellers in the market, then when the price increases from $4 to $6, the market quantity supplied

Accepted Answer

A)   decreases by 10 units.
B)   decreases by 20 units.
C)   increases by 10 units.
D)   increases by 20 units.E) B) and D)
F) A) and B)

Question 20

Suppose the incomes of buyers in a market for a particular normal good decrease and there is also a reduction in input prices. What would we expect to occur in this market?

Accepted Answer

A)   Equilibrium price would decrease, but the impact on equilibrium quantity would be ambiguous.
B)   Equilibrium price would increase, but the impact on equilibrium quantity would be ambiguous.
C)   Equilibrium quantity would decrease, but the impact on equilibrium price would be ambiguous.
D)   Equilibrium quantity would increase, but the impact on equilibrium price would be ambiguous.E) None of the above
F) A) and B)

Exam 4: The Market Forces of Supply and Demand

Figure 4-18 -Refer to Figure 4-18. At a price of $4, there is a

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

Correct Answer
verified

Figure 4-13 -Refer to Figure 4-13. The shift from S to S' is called a(n)

Correct Answer
verified

Correct Answer
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When Mario's income decreases, he buys more pasta. For Mario, pasta is a normal good.

Correct Answer
verified

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

Correct Answer
verified

An increase in the price of a good will

Correct Answer
verified

A decrease in income will shift the demand curve for an inferior good to the right.

Correct Answer
verified

Table 4-5 -Refer to Table 4-5. If these are the only four sellers in the market, then when the price increases from $4 to $6, the market quantity supplied

Correct Answer
verified

Recent forest fires in the western states are expected to cause the price of lumber to rise in the next six months. As a result, we can expect the supply of lumber to

Correct Answer
verified

Supply refers to the position of the supply curve, whereas the quantity supplied refers to the amount suppliers wish to sell.

Correct Answer
verified

In a perfectly competitive market, the goods offered for sale are all exactly the same.

Correct Answer
verified

Suppose the incomes of buyers in a market for a particular normal good decrease and there is also a reduction in input prices. What would we expect to occur in this market?

Correct Answer
verified

An increase in the price of ink will shift the supply curve for pens to the left.

Correct Answer
verified

When all market participants are price takers who have no influence over prices, the markets have

Correct Answer
verified

If a firm is a price taker, it operates in a

Correct Answer
verified

Table 4-2 -Refer to Table 4-2. If these are the only four buyers in the market, then when the price decreases from $6 to $4, the market quantity demanded

Correct Answer
verified

An increase in the price of oranges would lead to

Correct Answer
verified

Supply and demand together determine the price and quantity of a good sold in a market.

Correct Answer
verified

A market is a group of buyers and sellers of a particular good or service.

Correct Answer
verified

Exam 4: The Market Forces of Supply and Demand

Figure 4-18 -Refer to Figure 4-18. At a price of $4, there is a

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Figure 4-13 -Refer to Figure 4-13. The shift from S to S' is called a(n)

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

When Mario's income decreases, he buys more pasta. For Mario, pasta is a normal good.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

An increase in the price of a good will

Correct AnswerverifiedShow Answer

A decrease in income will shift the demand curve for an inferior good to the right.

Correct AnswerverifiedShow Answer

Table 4-5 -Refer to Table 4-5. If these are the only four sellers in the market, then when the price increases from $4 to $6, the market quantity supplied

Correct AnswerverifiedShow Answer

Recent forest fires in the western states are expected to cause the price of lumber to rise in the next six months. As a result, we can expect the supply of lumber to

Correct AnswerverifiedShow Answer

Supply refers to the position of the supply curve, whereas the quantity supplied refers to the amount suppliers wish to sell.

Correct AnswerverifiedShow Answer

In a perfectly competitive market, the goods offered for sale are all exactly the same.

Correct AnswerverifiedShow Answer

Suppose the incomes of buyers in a market for a particular normal good decrease and there is also a reduction in input prices. What would we expect to occur in this market?

Correct AnswerverifiedShow Answer

An increase in the price of ink will shift the supply curve for pens to the left.

Correct AnswerverifiedShow Answer

When all market participants are price takers who have no influence over prices, the markets have

Correct AnswerverifiedShow Answer

If a firm is a price taker, it operates in a

Correct AnswerverifiedShow Answer

Table 4-2 -Refer to Table 4-2. If these are the only four buyers in the market, then when the price decreases from $6 to $4, the market quantity demanded

Correct AnswerverifiedShow Answer

An increase in the price of oranges would lead to

Correct AnswerverifiedShow Answer

Supply and demand together determine the price and quantity of a good sold in a market.

Correct AnswerverifiedShow Answer

A market is a group of buyers and sellers of a particular good or service.

Correct AnswerverifiedShow Answer

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