Question 1

Two goods are complements when a decrease in the price of one good

Accepted Answer

A)  decreases the quantity demanded of the other good.
B)  decreases the demand for the other good.
C)  increases the quantity demanded of the other good.
D)  increases the demand for the other good.E) All of the above
F) A) and C)

Question 2

Suppose John and Wayne are the only two demanders of cowboy movies. Each month, John buys six cowboy movies when the price is $10 each, and he buys four cowboy movies when the price is $15 each. Each month, Wayne buys four cowboy movies when the price is $10 each, and he buys two cowboy movies when the price is $15 each. Which of the following points is on the market demand curve?

Accepted Answer

A)  quantity demanded = 2; price = $15
B)  quantity demanded = 4; price = $25
C)  quantity demanded = 10; price = $10
D)  quantity demanded = 16; price = $25E) B) and D)
F) A) and D)

Question 3

Who gets scarce resources in a market economy?

Accepted Answer

A)  the government
B)  whoever the government decides gets them
C)  whoever wants them
D)  whoever is willing and able to pay the priceE) B) and D)
F) B) and C)

Question 4

Table 4-13
The demand schedule below pertains to sandwiches demanded per week. 
-Refer to Table 4-13. Suppose x = 1. Then it must be true that

Accepted Answer

A)  Harry and Jake have the same income, which is lower than Darby's income.
B)  if sandwiches and potato chips are complements for Harry, then those two goods are also complements for Jake.
C)  Harry's demand curve is identical to Jake's demand curve.
D)  All of the above are correct.E) B) and C)
F) A) and D)

Question 5

Table 4-15
The following table shows the number of cases of water each seller is willing to sell at the prices listed. 
-Refer to Table 4-15. If all four suppliers operate in this market, what is the market quantity supplied when the price is $6.00 per case?

Accepted Answer

The answer of Table 4-15
The following table shows the number...

Question 6

Figure 4-7 
-Refer to Figure 4-7. The shift from Da to Db is called

Accepted Answer

A)  an increase in demand.
B)  a decrease in demand.
C)  a decrease in quantity demanded.
D)  an increase in quantity demanded.E) B) and D)
F) C) and D)

Question 7

The law of supply and demand asserts that

Accepted Answer

A)  demand curves and supply curves tend to shift to the right as time goes by.
B)  the price of a good will eventually rise in response to an excess demand for that good.
C)  when the supply curve for a good shifts, the demand curve for that good shifts in response.
D)  the equilibrium price of a good will be rising more often than it will be falling.E) None of the above
F) B) and C)

Question 8

If something happens to alter the quantity demanded at any given price, then

Accepted Answer

A)  the demand curve becomes steeper.
B)  the demand curve becomes flatter.
C)  the demand curve shifts.
D)  we move along the demand curve.E) C) and D)
F) B) and D)

Question 9

A supply curve slopes upward because

Accepted Answer

A)  as more is produced, total cost of production falls.
B)  an increase in input prices increases supply.
C)  the quantity supplied of most goods and services increases over time.
D)  an increase in price gives producers an incentive to supply a larger quantity.E) All of the above
F) A) and C)

Question 10

Suppose there is a decrease in the price of corn. If corn is an input into the production of ethanol, we would expect the supply curve for ethanol to

Accepted Answer

A)  shift rightward.
B)  shift leftward.
C)  become flatter.
D)  remain unchanged.E) A) and D)
F) None of the above

Question 11

The law of demand states that, other things equal, when the price of a good rises, the quantity demanded of the good falls, and when the price falls, the quantity demanded rises.

Accepted Answer

A) True 
 B)False

Question 12

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

Accepted Answer

A)  Sellers set the price of the product.
B)  There are many sellers.
C)  Buyers must accept the price the market determines.
D)  All of the above are characteristics of a perfectly competitive market.E) C) and D)
F) None of the above

Question 13

Figure 4-26 
-Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for Ramen noodles of a decrease in the incomes of young adults, assuming that Ramen noodles are an inferior good?

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) B) and D)
F) A) and B)

Question 14

Table 4-13
The demand schedule below pertains to sandwiches demanded per week. 
-Refer to Table 4-13. Regarding Harry and Darby, for whom are sandwiches a normal good?

Accepted Answer

A)  only for Harry
B)  only for Darby
C)  for both Harry and Darby
D)  This cannot be determined from the given information.E) A) and B)
F) B) and C)

Question 15

Today, people changed their expectations about the future. This change

Accepted Answer

A)  can cause a movement along a demand curve.
B)  can affect future demand but not today's demand.
C)  can affect today's demand.
D)  cannot affect either today's demand or future demand.E) All of the above
F) A) and D)

Question 16

In a competitive market, there are so few buyers and so few sellers that each has a significant impact on the market price.

Accepted Answer

A) True 
 B)False

Question 17

The dictionary defines equilibrium as a situation in which forces

Accepted Answer

A)  are in balance.
B)  are the same.
C)  clash.
D)  remain constant.E) None of the above
F) All of the above

Question 18

If a good is inferior, then an increase in income will result in a(n)

Accepted Answer

A)  increase in the demand for the good.
B)  decrease in the demand for the good.
C)  movement down and to the right along the demand curve for the good.
D)  movement up and to the left along the demand curve for the good.E) B) and C)
F) None of the above

Question 19

Table 4-15
The following table shows the number of cases of water each seller is willing to sell at the prices listed. 
-Refer to Table 4-15. Assuming these are the only four suppliers in this market and the function for market demand is QD=1000-100P, where QD is the quantity demanded and P is the price, what is the equilibrium quantity?

Accepted Answer

Question 20

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

Accepted Answer

The answer of A group of buyers and sellers of...

Exam 4: The Market Forces of Supply and Demand

Who gets scarce resources in a market economy?

Correct Answer
verified

Today, people changed their expectations about the future. This change

Correct Answer
verified

Table 4-15 The following table shows the number of cases of water each seller is willing to sell at the prices listed. -Refer to Table 4-15. If all four suppliers operate in this market, what is the market quantity supplied when the price is $6.00 per case?

Correct Answer
verified

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

Correct Answer
verified

If something happens to alter the quantity demanded at any given price, then

Correct Answer
verified

Table 4-13 The demand schedule below pertains to sandwiches demanded per week. -Refer to Table 4-13. Regarding Harry and Darby, for whom are sandwiches a normal good?

Correct Answer
verified

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

Correct Answer
verified

A supply curve slopes upward because

Correct Answer
verified

In a competitive market, there are so few buyers and so few sellers that each has a significant impact on the market price.

Correct Answer
verified

The law of supply and demand asserts that

Correct Answer
verified

Suppose there is a decrease in the price of corn. If corn is an input into the production of ethanol, we would expect the supply curve for ethanol to

Correct Answer
verified

Correct Answer
verified

Figure 4-26 -Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for Ramen noodles of a decrease in the incomes of young adults, assuming that Ramen noodles are an inferior good?

Correct Answer
verified

Table 4-13 The demand schedule below pertains to sandwiches demanded per week. -Refer to Table 4-13. Suppose x = 1. Then it must be true that

Correct Answer
verified

Correct Answer
verified

The dictionary defines equilibrium as a situation in which forces

Correct Answer
verified

Two goods are complements when a decrease in the price of one good

Correct Answer
verified

Figure 4-7 -Refer to Figure 4-7. The shift from Da to Db is called

Correct Answer
verified

The law of demand states that, other things equal, when the price of a good rises, the quantity demanded of the good falls, and when the price falls, the quantity demanded rises.

Correct Answer
verified

If a good is inferior, then an increase in income will result in a(n)

Correct Answer
verified

Exam 4: The Market Forces of Supply and Demand

Who gets scarce resources in a market economy?

Correct AnswerverifiedShow Answer

Today, people changed their expectations about the future. This change

Correct AnswerverifiedShow Answer

Table 4-15 The following table shows the number of cases of water each seller is willing to sell at the prices listed. -Refer to Table 4-15. If all four suppliers operate in this market, what is the market quantity supplied when the price is $6.00 per case?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

If something happens to alter the quantity demanded at any given price, then

Correct AnswerverifiedShow Answer

Table 4-13 The demand schedule below pertains to sandwiches demanded per week. -Refer to Table 4-13. Regarding Harry and Darby, for whom are sandwiches a normal good?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

A supply curve slopes upward because

Correct AnswerverifiedShow Answer

In a competitive market, there are so few buyers and so few sellers that each has a significant impact on the market price.

Correct AnswerverifiedShow Answer

The law of supply and demand asserts that

Correct AnswerverifiedShow Answer

Suppose there is a decrease in the price of corn. If corn is an input into the production of ethanol, we would expect the supply curve for ethanol to

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Figure 4-26 -Refer to Figure 4-26. Which of the following movements would illustrate the effect in the market for Ramen noodles of a decrease in the incomes of young adults, assuming that Ramen noodles are an inferior good?

Correct AnswerverifiedShow Answer

Table 4-13 The demand schedule below pertains to sandwiches demanded per week. -Refer to Table 4-13. Suppose x = 1. Then it must be true that

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The dictionary defines equilibrium as a situation in which forces

Correct AnswerverifiedShow Answer

Two goods are complements when a decrease in the price of one good

Correct AnswerverifiedShow Answer

Figure 4-7 -Refer to Figure 4-7. The shift from Da to Db is called

Correct AnswerverifiedShow Answer

The law of demand states that, other things equal, when the price of a good rises, the quantity demanded of the good falls, and when the price falls, the quantity demanded rises.

Correct AnswerverifiedShow Answer

If a good is inferior, then an increase in income will result in a(n)

Correct AnswerverifiedShow Answer

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