Question 1

A demand curve is a graph that:

Accepted Answer

A)  visually displays the demand schedule.
B)  depicts various price-quantity combinations of a good for a seller.
C)  shows the quantities demanded by consumers of a particular good or service at various incomes.
D)  shows the quantities demanded by consumers of a particular good or service at one price.E) None of the above
F) A) and B)

Question 2

The law of demand describes the:

Accepted Answer

A)  inverse relationship between price and quantity demanded.
B)  direct relationship between price and quantity demanded.
C)  inverse relationship between income and quantity demanded.
D)  direct relationship between income and quantity demanded.E) None of the above
F) All of the above

Question 3

The graph shown depicts the market for a good. At a price of $5, there is:

Accepted Answer

A)  a shortage (excess demand) of 10 units.
B)  a shortage (excess demand) of 20 units.
C)  a shortage (excess demand) of 30 units.
D)  a surplus (excess supply) of 20 units.E) A) and B)
F) All of the above

Question 4

When quantity supplied equals quantity demanded:

Accepted Answer

A)  equilibrium is reached.
B)  the market pushes the economy to produce more.
C)  the market pushes the economy to produce less.
D)  the market ceases to function.E) A) and D)
F) None of the above

Question 5

Consider the market for cupcakes, which is currently in equilibrium. Now, suppose that two events happen simultaneously: (1) the price of sugar, used in the production of cupcakes, decreases and (2) the American Heart Association announces that consumption of excess sugar is extremely dangerous to one's health, reducing the popularity of cupcakes. What effect might these events have on the market for cupcakes?

Accepted Answer

A)  The equilibrium price will fall and the equilibrium quantity will rise.
B)  The equilibrium quantity will fall, but the change in the equilibrium price cannot be determined.
C)  The equilibrium price will rise and the equilibrium quantity will fall.
D)  The equilibrium price will fall, but the change in the equilibrium quantity cannot be determined.E) C) and D)
F) None of the above

Question 6

Suppose irregular weather patterns caused very poor yields for orange farmers this past year. Which factor of supply would this change in the market for orange juice?

Accepted Answer

A)  Technology
B)  Price of input
C)  Number of sellers
D)  Price of related goodE) A) and B)
F) A) and D)

Question 7

Which of the following would not affect an individual's demand?

Accepted Answer

A)  Prices of related goods
B)  The individual's preferences
C)  The individual's income
D)  The costs of inputsE) A) and C)
F) A) and D)

Question 8

The demand schedule assumes that factors other than price:

Accepted Answer

A)  remain the same.
B)  must also be in the table.
C)  remain separate in the table.
D)  change as price changes.E) None of the above
F) All of the above

Question 9

When graphing the demand curve:

Accepted Answer

A)  quantity goes on the horizontal axis and price goes on the vertical axis.
B)  quantity goes on the vertical axis and price goes on the horizontal axis.
C)  both quantity and price go on the horizontal axis.
D)  it doesn't matter which axis price and quantity are placed on.E) None of the above
F) A) and D)

Question 10

What happens to the demand curve when a non-price determinant of demand changes?

Accepted Answer

A)  The demand curve shifts to the left or to the right.
B)  There is a movement along the demand curve.
C)  The consumer moves to a different price point.
D)  The demand curve does not change when a non-price determinant of demand changes.E) A) and D)
F) None of the above

Question 11

In the market shown in the graph, the equilibrium price is:

Accepted Answer

A)  $6.
B)  $27.
C)  $36.
D)  $12.E) A) and C)
F) B) and C)

Question 12

The table shown depicts the demand and supply schedules of a good. Equilibrium in this market will occur at:

Accepted Answer

A)  a price of $1.50 and a quantity of 62.
B)  a price of $1.50 and a quantity of 31.
C)  a price of $0.00 and a quantity of 75.
D)  an indeterminate price and quantity.E) A) and B)
F) A) and C)

Question 13

Suppose the demand for chicken has increased. This change can be shown graphically as a:

Accepted Answer

A)  shift in the demand curve to the right.
B)  shift in the demand curve to the left.
C)  movement along the demand curve to the right.
D)  movement along the demand curve to the left.E) C) and D)
F) B) and C)

Question 14

With the baby boomer generation hitting the retirement age, waiting lists to get into nursing homes are on the rise. In this situation, we could reasonably expect the demand for geriatric care to:

Accepted Answer

A)  increase due to the number of buyers increasing.
B)  decrease due to the number of buyers increasing.
C)  increase due to expectations of future prices.
D)  decrease due to expectations of future prices.E) C) and D)
F) B) and C)

Question 15

On the first day of school, Jackie notices many of her classmates are wearing Converse sneakers. Ever the fashionista, this will likely affect:

Accepted Answer

A)  Jackie's income, as she will now buy Converse sneakers and will have less to spend on other goods.
B)  Jackie's preferences for Converse sneakers, since she feels as though she needs them now.
C)  Jackie's expectations of future prices, since the price of Converse sneakers will likely increase due to their popularity.
D)  the prices of related goods, since other sneakers will be less popular and thus their prices will decrease.E) All of the above
F) A) and D)

Question 16

Which of the following is not a non-price determinant of supply?

Accepted Answer

A)  Consumer preferences
B)  Technology
C)  Prices of inputs
D)  Prices of related goodsE) A) and B)
F) B) and D)

Question 17

Demand for Shell gasoline will increase if the price of:

Accepted Answer

A)  motor vehicles increases.
B)  BP gasoline increases.
C)  BP gasoline decreases.
D)  Shell gasoline decreases.E) A) and C)
F) B) and C)

Question 18

The most likely substitute good for cereal would be:

Accepted Answer

A)  a bagel.
B)  milk.
C)  pizza.
D)  a hot dog.E) B) and C)
F) A) and B)

Question 19

In a _____ economy, private individuals (as opposed to a central planner) make decisions.

Accepted Answer

A)  market
B)  government controlled
C)  socialist
D)  barterE) A) and D)
F) B) and C)

Question 20

Consider the market for pecans, which is currently in equilibrium. Now, suppose a hurricane destroys a large number of pecan trees. How will the market for pecans change as a result of the hurricane?

Accepted Answer

A)  The equilibrium price will decrease and the equilibrium quantity will increase due to an increase in supply.
B)  The equilibrium price will increase and the equilibrium quantity will decrease due to a decrease in supply.
C)  The equilibrium price and quantity will fall due to a decrease in supply and demand.
D)  The equilibrium price will increase and the equilibrium quantity will decrease due to a decrease in supply and an increase in demand.E) A) and D)
F) None of the above

Exam 3: Markets

The most likely substitute good for cereal would be:

Correct Answer
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Which of the following is not a non-price determinant of supply?

Correct Answer
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Suppose the demand for chicken has increased. This change can be shown graphically as a:

Correct Answer
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In the market shown in the graph, the equilibrium price is:

Correct Answer
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The graph shown depicts the market for a good. At a price of $5, there is:

Correct Answer
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With the baby boomer generation hitting the retirement age, waiting lists to get into nursing homes are on the rise. In this situation, we could reasonably expect the demand for geriatric care to:

Correct Answer
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Suppose irregular weather patterns caused very poor yields for orange farmers this past year. Which factor of supply would this change in the market for orange juice?

Correct Answer
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The law of demand describes the:

Correct Answer
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What happens to the demand curve when a non-price determinant of demand changes?

Correct Answer
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When quantity supplied equals quantity demanded:

Correct Answer
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Which of the following would not affect an individual's demand?

Correct Answer
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On the first day of school, Jackie notices many of her classmates are wearing Converse sneakers. Ever the fashionista, this will likely affect:

Correct Answer
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A demand curve is a graph that:

Correct Answer
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Correct Answer
verified

In a _____ economy, private individuals (as opposed to a central planner) make decisions.

Correct Answer
verified

Consider the market for pecans, which is currently in equilibrium. Now, suppose a hurricane destroys a large number of pecan trees. How will the market for pecans change as a result of the hurricane?

Correct Answer
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When graphing the demand curve:

Correct Answer
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The table shown depicts the demand and supply schedules of a good. Equilibrium in this market will occur at:

Correct Answer
verified

The demand schedule assumes that factors other than price:

Correct Answer
verified

Demand for Shell gasoline will increase if the price of:

Correct Answer
verified

Exam 3: Markets

The most likely substitute good for cereal would be:

Correct AnswerverifiedShow Answer

Which of the following is not a non-price determinant of supply?

Correct AnswerverifiedShow Answer

Suppose the demand for chicken has increased. This change can be shown graphically as a:

Correct AnswerverifiedShow Answer

In the market shown in the graph, the equilibrium price is:

Correct AnswerverifiedShow Answer

The graph shown depicts the market for a good. At a price of $5, there is:

Correct AnswerverifiedShow Answer

With the baby boomer generation hitting the retirement age, waiting lists to get into nursing homes are on the rise. In this situation, we could reasonably expect the demand for geriatric care to:

Correct AnswerverifiedShow Answer

Suppose irregular weather patterns caused very poor yields for orange farmers this past year. Which factor of supply would this change in the market for orange juice?

Correct AnswerverifiedShow Answer

The law of demand describes the:

Correct AnswerverifiedShow Answer

What happens to the demand curve when a non-price determinant of demand changes?

Correct AnswerverifiedShow Answer

When quantity supplied equals quantity demanded:

Correct AnswerverifiedShow Answer

Which of the following would not affect an individual's demand?

Correct AnswerverifiedShow Answer

On the first day of school, Jackie notices many of her classmates are wearing Converse sneakers. Ever the fashionista, this will likely affect:

Correct AnswerverifiedShow Answer

A demand curve is a graph that:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

In a _____ economy, private individuals (as opposed to a central planner) make decisions.

Correct AnswerverifiedShow Answer

Consider the market for pecans, which is currently in equilibrium. Now, suppose a hurricane destroys a large number of pecan trees. How will the market for pecans change as a result of the hurricane?

Correct AnswerverifiedShow Answer

When graphing the demand curve:

Correct AnswerverifiedShow Answer

The table shown depicts the demand and supply schedules of a good. Equilibrium in this market will occur at:

Correct AnswerverifiedShow Answer

The demand schedule assumes that factors other than price:

Correct AnswerverifiedShow Answer

Demand for Shell gasoline will increase if the price of:

Correct AnswerverifiedShow Answer

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