Question 1

Table 4-12
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:
 
-Refer to Table 4-12. 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) C) and D)
F) B) and C)

Question 2

Once the supply curve for a product or service is drawn, it

Accepted Answer

A)   remains stable over time.
B)   can shift either rightward or leftward.
C)   is possible to move along the curve, but the curve will not shift.
D)   tends to become steeper over time.E) A) and B)
F) C) and D)

Question 3

What will happen to the equilibrium price of new textbooks if more students attend college, paper becomes cheaper, textbook authors accept lower royalties, and fewer used textbooks are sold?

Accepted Answer

A)   Price will rise.
B)   Price will fall.
C)   Price will stay exactly the same.
D)   The price change will be ambiguous.E) B) and D)
F) A) and B)

Question 4

Pens are normal goods. What will happen to the equilibrium price of pens if the price of pencils rises, consumers experience an increase in income, writing in ink becomes fashionable, people expect the price of pens to rise in the near future, the population increases, fewer firms manufacture pens, and the wages of pen-makers increase?

Accepted Answer

A)   Price will rise.
B)   Price will fall.
C)   Price will stay exactly the same.
D)   The price change will be ambiguous.E) B) and D)
F) All of the above

Question 5

Table 4-3
 
-Refer to Table 4-3. Whose demand does not obey the law of demand?

Accepted Answer

A)   Bert's
B)   Ernie's
C)   Grover's
D)   Oscar'sE) C) and D)
F) None of the above

Question 6

If the price of steel, an input into the production of automobiles, rises, and at the same time the price of gasoline rises, what will happen to the equilibrium price and quantity of automobiles?

Accepted Answer

The equilibrium quan...

Question 7

Which of the following sets of events must cause an increase in the price of a new house?

Accepted Answer

A)   higher wages for carpenters, higher wood prices, increases in consumer incomes, higher apartment rents, increases in population, and expectations of higher house prices in the future
B)   lower wages for carpenters, lower wood prices, increases in consumer incomes, higher apartment rents, increases in population and expectations of higher house prices in the future
C)   lower wages for carpenters, higher wood prices, decreases in consumer incomes, higher apartment rents, decreases in population and expectations of higher house prices in the future
D)   higher wages for carpenters, lower wood prices, decreases in consumer incomes, lower apartment rents, decreases in population and expectations of lower house prices in the futureE) C) and D)
F) B) and D)

Question 8

Prices allocate a market economy's scarce resources.

Accepted Answer

A) True 
 B)False

Question 9

Warrensburg is a small college town in Missouri. At the end of August each year, the market demand for fast food in Warrensburg

Accepted Answer

A)   increases.
B)   decreases.
C)   remains constant, but we observe a movement downward and to the right along the demand curve.
D)   remains constant, but we observe a movement upward and to the left along the demand curve.E) A) and B)
F) C) and D)

Question 10

Table 4-8
 
-Refer to Table 4-8. Suppose Firm X and Firm Y are the only two sellers in the market. If the market price increases from $12 to $15, quantity supplied will

Accepted Answer

A)   decrease by 6 units.
B)   decrease by 12 units.
C)   increase by 6 units.
D)   increase by 12 units.E) A) and D)
F) A) and C)

Question 11

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 B)
F) None of the above

Question 12

Today's demand curve for gasoline could shift in response to a change in

Accepted Answer

A)   today's price of gasoline.
B)   the expected future price of gasoline.
C)   the number of sellers of gasoline.
D)   All of the above are correct.E) None of the above
F) A) and B)

Question 13

Figure 4-7 
-Refer to Figure 4-7. The shift from Db to Da 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) A) and B)
F) All of the above

Question 14

Which of the following is a determinant of the market supply curve but not a determinant of an individual seller's supply?

Accepted Answer

A)   production technology
B)   expectations
C)   input prices
D)   the number of sellersE) None of the above
F) A) and C)

Question 15

What will happen in the gasoline market now if buyers expect higher gasoline prices in the near future?

Accepted Answer

A)   The demand for gasoline will increase.
B)   The demand for gasoline will decrease.
C)   The demand for gasoline will be unaffected.
D)   The supply of gasoline will increase.E) C) and D)
F) B) and D)

Question 16

Equilibrium quantity must decrease when demand

Accepted Answer

A)   increases and supply does not change, when demand does not change and supply decreases, and when both demand and supply decrease.
B)   increases and supply does not change, when demand does not change and supply increases, and when both demand and supply decrease.
C)   decreases and supply does not change, when demand does not change and supply increases, and when both demand and supply decrease.
D)   decreases and supply does not change, when demand does not change and supply decreases, and when both demand and supply decrease.E) A) and D)
F) All of the above

Question 17

An improvement in production technology will

Accepted Answer

A)   increase a firm's costs and increase its supply.
B)   increase a firm's costs and decrease its supply.
C)   decrease a firm's costs and increase its supply.
D)   decrease a firm's costs and decrease its supply.E) All of the above
F) A) and B)

Question 18

If the supply of a product decreases, then we would expect equilibrium price

Accepted Answer

A)   to increase and equilibrium quantity to decrease.
B)   to decrease and equilibrium quantity to increase.
C)   and equilibrium quantity to both increase.
D)   and equilibrium quantity to both decrease.E) All of the above
F) A) and C)

Question 19

Figure 4-29 
-Refer to Figure 4-29. If the price increases from $5 to $6, how does the quantity demanded change?

Accepted Answer

The answer of Figure 4-29 
-Refer to Figure 4-29. If...

Question 20

A decrease in demand is represented by a

Accepted Answer

A)   movement downward and to the right along a demand curve.
B)   movement upward and to the left along a demand curve.
C)   rightward shift of a demand curve.
D)   leftward shift of a demand curve.E) All of the above
F) None of the above

Exam 4: The Market Forces of Supply and Demand

Figure 4-29 -Refer to Figure 4-29. If the price increases from $5 to $6, how does the quantity demanded change?

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

Once the supply curve for a product or service is drawn, it

Correct Answer
verified

Warrensburg is a small college town in Missouri. At the end of August each year, the market demand for fast food in Warrensburg

Correct Answer
verified

Today's demand curve for gasoline could shift in response to a change in

Correct Answer
verified

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

Correct Answer
verified

A decrease in demand is represented by a

Correct Answer
verified

Correct Answer
verified

Which of the following sets of events must cause an increase in the price of a new house?

Correct Answer
verified

If the price of steel, an input into the production of automobiles, rises, and at the same time the price of gasoline rises, what will happen to the equilibrium price and quantity of automobiles?

Correct Answer
verified
The equilibrium quan...
View Answer

An improvement in production technology will

Correct Answer
verified

What will happen to the equilibrium price of new textbooks if more students attend college, paper becomes cheaper, textbook authors accept lower royalties, and fewer used textbooks are sold?

Correct Answer
verified

Correct Answer
verified

Table 4-8 -Refer to Table 4-8. Suppose Firm X and Firm Y are the only two sellers in the market. If the market price increases from $12 to $15, quantity supplied will

Correct Answer
verified

Equilibrium quantity must decrease when demand

Correct Answer
verified

Table 4-3 -Refer to Table 4-3. Whose demand does not obey the law of demand?

Correct Answer
verified

If the supply of a product decreases, then we would expect equilibrium price

Correct Answer
verified

What will happen in the gasoline market now if buyers expect higher gasoline prices in the near future?

Correct Answer
verified

Prices allocate a market economy's scarce resources.

Correct Answer
verified

Which of the following is a determinant of the market supply curve but not a determinant of an individual seller's supply?

Correct Answer
verified

Exam 4: The Market Forces of Supply and Demand

Figure 4-29 -Refer to Figure 4-29. If the price increases from $5 to $6, how does the quantity demanded change?

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

Once the supply curve for a product or service is drawn, it

Correct AnswerverifiedShow Answer

Warrensburg is a small college town in Missouri. At the end of August each year, the market demand for fast food in Warrensburg

Correct AnswerverifiedShow Answer

Today's demand curve for gasoline could shift in response to a change in

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

A decrease in demand is represented by a

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following sets of events must cause an increase in the price of a new house?

Correct AnswerverifiedShow Answer

If the price of steel, an input into the production of automobiles, rises, and at the same time the price of gasoline rises, what will happen to the equilibrium price and quantity of automobiles?

Correct AnswerverifiedThe equilibrium quan...View AnswerShow Answer

An improvement in production technology will

Correct AnswerverifiedShow Answer

What will happen to the equilibrium price of new textbooks if more students attend college, paper becomes cheaper, textbook authors accept lower royalties, and fewer used textbooks are sold?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Table 4-8 -Refer to Table 4-8. Suppose Firm X and Firm Y are the only two sellers in the market. If the market price increases from $12 to $15, quantity supplied will

Correct AnswerverifiedShow Answer

Equilibrium quantity must decrease when demand

Correct AnswerverifiedShow Answer

Table 4-3 -Refer to Table 4-3. Whose demand does not obey the law of demand?

Correct AnswerverifiedShow Answer

If the supply of a product decreases, then we would expect equilibrium price

Correct AnswerverifiedShow Answer

What will happen in the gasoline market now if buyers expect higher gasoline prices in the near future?

Correct AnswerverifiedShow Answer

Prices allocate a market economy's scarce resources.

Correct AnswerverifiedShow Answer

Which of the following is a determinant of the market supply curve but not a determinant of an individual seller's supply?

Correct AnswerverifiedShow Answer

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The equilibrium quan...
View Answer

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