Question 1

If the price of kayaks rises, the

Accepted Answer

A)   supply of kayaks increases.
B)   supply of kayaks decreases.
C)   quantity supplied of kayaks increases.
D)   quantity supplied of kayaks decreases.E) A) and B)
F) A) and C)

Question 2

(Figure: Interpreting Market Equilibrium)  If the price is $10, then there is a _____ units and the price will _____.

Accepted Answer

A)   shortage of 4,000; fall
B)   shortage of 2,000; rise
C)   surplus of 4,000; fall
D)   surplus of 2,000; fallE) None of the above
F) C) and D)

Question 3

The supply curve

Accepted Answer

A)   slopes downward and to the right.
B)   shows a negative relationship between price and quantity supplied.
C)   shows a positive relationship between price and quantity supplied.
D)   shows that producers can charge whatever price they wish for their products.E) A) and B)
F) A) and C)

Question 4

(Figure: Supply and Demand for Shoes)  If the price of shoes is $60, then the market

Accepted Answer

A)   is in equilibrium.
B)   experiences a shortage of shoes.
C)   experiences a surplus of shoes.
D)   There is not enough information to answer this question.E) A) and B)
F) A) and C)

Question 5

If bad weather persists in a summer resort town, we can expect demand for hotels to shift left and the equilibrium price to rise.

Accepted Answer

A) True 
 B)False

Question 6

If buyers do not value a specific product, they will pay the asking price immediately.

Accepted Answer

A) True 
 B)False

Question 7

As the price of a bag of Doritos increases, the quantity demanded for this product will decrease.

Accepted Answer

A) True 
 B)False

Question 8

Certeris paribus, the effect of a decrease in income on a normal good is to shift the

Accepted Answer

A)   supply curve to the left, increasing the equilibrium price and reducing equilibrium output.
B)   supply curve to the right, reducing the equilibrium price and increasing equilibrium output.
C)   demand curve to the left, reducing both equilibrium price and output.
D)   demand curve to the right, increasing both equilibrium price and output.E) B) and C)
F) A) and D)

Question 9

Describe the difference between a change in supply and a change in quantity supplied. Provide graphs to help explain your response.

Accepted Answer

A change in supply is represented in pan...

Question 10

During the last recession, consumer spending on dogs and cats fell because national income declined.

Accepted Answer

A) True 
 B)False

Question 11

Markets require a physical location for transactions to take place.

Accepted Answer

A) True 
 B)False

Question 12

In a market when the price of a good changes

Accepted Answer

A)   both quantity demanded for and quantity supplied of the good change.
B)   demand for the good changes.
C)   both demand for and supply of the good change.
D)   both the demand curve and the supply curve for the good shift.E) C) and D)
F) All of the above

Question 13

A demand schedule is

Accepted Answer

A)   a shopping list.
B)   a list of prices and the quantities demanded at those prices.
C)   the quantity a person actually purchases.
D)   a list of prices and incomes.E) A) and C)
F) A) and D)

Question 14

(Figure: Interpreting Supply Shifts 3)  When the supply shifts from S0 to S1, the equilibrium price changes from 0 to S1, the equilibrium price changes from   A)  $60 to $40. B)  $40 to $60. C)  20 units to 15 units. D)  15 units to 20 units." class="answers-bank-image d-inline" rel="preload" >

Accepted Answer

A)   $60 to $40.
B)   $40 to $60.
C)   20 units to 15 units.
D)   15 units to 20 units.E) A) and C)
F) A) and B)

Question 15

If both the supply of and the demand for a good increase simultaneously, the equilibrium quantity will

Accepted Answer

A)   increase.
B)   decrease.
C)   be indeterminate.
D)   remain unchanged.E) A) and B)
F) A) and C)

Question 16

State the law of demand and explain how it relates to changes in the price of 2-liter bottles of Coca-Cola.

Accepted Answer

The principle that as price increases, q...

Question 17

Which event would shift the supply curve for coffee to the left?

Accepted Answer

A)   an increase in the minimum wage
B)   an increase in subsidies for coffee production
C)   an increase in the price of coffee
D)   an increase in the number of coffee farmersE) B) and C)
F) All of the above

Question 18

(Figure: Predicting Supply Shifts)  The shift from S1 to S2 might be caused by an increase in 1 to S2 might be caused by an increase in   A)  the prices of other goods made by firms. B)  national income. C)  resource costs. D)  subsidies." class="answers-bank-image d-inline" rel="preload" >

Accepted Answer

A)   the prices of other goods made by firms.
B)   national income.
C)   resource costs.
D)   subsidies.E) A) and B)
F) B) and C)

Question 19

If bagels and doughnuts are substitute goods, then which scenario is likely to occur if the price of bagels is reduced?

Accepted Answer

A)   The demand curve for bagels will shift to the left.
B)   There will be a leftward movement along the bagel demand curve.
C)   The demand curve for doughnuts will shift to the right.
D)   The demand curve for doughnuts will shift to the left.E) None of the above
F) All of the above

Question 20

The reason a supply curve is upward sloping is that producing more units makes it more expensive to produce each individual unit.

Accepted Answer

A) True 
 B)False

Exam 3: Supply and Demand

The supply curve

Correct AnswerverifiedShow Answer

If both the supply of and the demand for a good increase simultaneously, the equilibrium quantity will

Correct AnswerverifiedShow Answer

Certeris paribus, the effect of a decrease in income on a normal good is to shift the

Correct AnswerverifiedShow Answer

Markets require a physical location for transactions to take place.

Correct AnswerverifiedShow Answer

If bagels and doughnuts are substitute goods, then which scenario is likely to occur if the price of bagels is reduced?

Correct AnswerverifiedShow Answer

Which event would shift the supply curve for coffee to the left?

Correct AnswerverifiedShow Answer

As the price of a bag of Doritos increases, the quantity demanded for this product will decrease.

Correct AnswerverifiedShow Answer

State the law of demand and explain how it relates to changes in the price of 2-liter bottles of Coca-Cola.

Correct AnswerverifiedThe principle that as price increases, q...View AnswerShow Answer

If bad weather persists in a summer resort town, we can expect demand for hotels to shift left and the equilibrium price to rise.

Correct AnswerverifiedShow Answer

(Figure: Supply and Demand for Shoes) If the price of shoes is $60, then the market

Correct AnswerverifiedShow Answer

In a market when the price of a good changes

Correct AnswerverifiedShow Answer

(Figure: Interpreting Market Equilibrium) If the price is $10, then there is a _____ units and the price will _____.

Correct AnswerverifiedShow Answer

If the price of kayaks rises, the

Correct AnswerverifiedShow Answer

If buyers do not value a specific product, they will pay the asking price immediately.

Correct AnswerverifiedShow Answer

During the last recession, consumer spending on dogs and cats fell because national income declined.

Correct AnswerverifiedShow Answer

A demand schedule is

Correct AnswerverifiedShow Answer

The reason a supply curve is upward sloping is that producing more units makes it more expensive to produce each individual unit.

Correct AnswerverifiedShow Answer

(Figure: Predicting Supply Shifts) The shift from S1 to S2 might be caused by an increase in

Correct AnswerverifiedShow Answer

Describe the difference between a change in supply and a change in quantity supplied. Provide graphs to help explain your response.

Correct AnswerverifiedA change in supply is represented in pan...View AnswerShow Answer

(Figure: Interpreting Supply Shifts 3) When the supply shifts from S0 to S1, the equilibrium price changes from

Correct AnswerverifiedShow Answer

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The principle that as price increases, q...
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(Figure: Interpreting Market Equilibrium) If the price is $10, then there is a _ units and the price will _.

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(Figure: Predicting Supply Shifts) The shift from S₁ to S₂ might be caused by an increase in

Correct Answer
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A change in supply is represented in pan...
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(Figure: Interpreting Supply Shifts 3) When the supply shifts from S₀ to S₁, the equilibrium price changes from

Correct Answer
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