Question 1

The graph shown depicts the market for a good. Suppose the government sets the price of this good at $36. At this price, there is:

Accepted Answer

A)  a surplus (excess supply) of 9,000 units.
B)  a shortage (excess demand) of 2,000 units.
C)  a shortage (excess demand) of 7,000 units.
D)  a surplus (excess supply) of 7,000 units.E) C) and D)
F) A) and B)

Question 2

Suppose the graph shown depicts the demand for a normal good. A shift from A to B might be caused by:

Accepted Answer

A)  a decrease in the price of a substitute.
B)  a decrease in the price of a complement.
C)  an increase in the price of a complement.
D)  an increase in the good's price.E) C) and D)
F) None of the above

Question 3

If a producer incorrectly sets the price of its product too high:

Accepted Answer

A)  a shortage (excess demand) will result.
B)  a surplus (excess supply) will result.
C)  equilibrium will result.
D)  the producer will soon shut down.E) B) and C)
F) A) and C)

Question 4

Suppose the graph shown depicts the demand for a normal good. A shift from B to A might be caused by:

Accepted Answer

A)  a decrease in the good's price.
B)  an increase in the good's price.
C)  a decrease in the price of a substitute.
D)  an increase in the price of a substitute.E) B) and D)
F) B) and C)

Question 5

The table shows individual demand schedules for a market. What is the equilibrium price in this market?

Accepted Answer

A)  $0.50
B)  $1.50
C)  $2.00
D)  The equilibrium price cannot be determined without more information.E) B) and D)
F) A) and B)

Question 6

The city of Burlington experiences very high temperatures each summer and very low temperatures each winter. We would expect the demand for ice cream to:

Accepted Answer

A)  increase constantly.
B)  decrease each summer and increase each winter.
C)  increase each summer and decrease each winter.
D)  decrease constantly.E) All of the above
F) None of the above

Question 7

Suppose the graph shown depicts the demand for a normal good. Pasua was originally consuming at point A, but after receiving a raise at work her demand may:

Accepted Answer

A)  be unaffected.
B)  increase to point B.
C)  increase to point C.
D)  drop to zero.E) A) and D)
F) A) and C)

Question 8

Consider the market for potato chips, which is currently in equilibrium. Now, suppose that two events happen simultaneously: (1) a new technology is invented that allows potato chip makers to produce potato chips at a lower cost and (2) the price of pretzels (a substitute in consumption) rises. What effect might these events have on the market for cupcakes?Supply will increase.Demand will increase.The change in equilibrium price cannot be determined.The change in equilibrium quantity cannot be determined.

Accepted Answer

A)  I, II, and III only
B)  II and III only
C)  I and IV only
D)  I, II, and IV onlyE) A) and B)
F) C) and D)

Question 9

Suppose the advancement of computers has decreased the productivity of a paper mill. This will likely cause _______ the supply curve for paper.

Accepted Answer

A)  a rightward shift of
B)  a leftward shift of
C)  a shift straight up of
D)  a movement alongE) B) and D)
F) All of the above B

Question 10

The table shows individual demand schedules for a market. At a price of $1.00, how much of the good will be demanded by Betty?

Accepted Answer

A)  16
B)  11
C)  46
D)  30E) None of the above
F) B) and C)

Question 11

The prices of related goods matter when determining supply because they affect:

Accepted Answer

A)  the opportunity cost of production.
B)  whether or not a good will sell.
C)  the competition in the market.
D)  the availability of substitute goods.E) None of the above
F) B) and C)

Question 12

Equilibrium takes place where:

Accepted Answer

A)  supply and demand intersect.
B)  supply is highest.
C)  demand is highest.
D)  prices are maximized.E) B) and C)
F) C) and D) A

Question 13

Suppose the graph shown depicts the demand for a normal good. A shift from A to B might be caused by:

Accepted Answer

A)  an increase in price.
B)  a decrease in price.
C)  an increase in income.
D)  a decrease in income.E) All of the above
F) C) and D) C

Question 14

Consider a market that is in equilibrium. If the market experiences both an increase in demand and an increase in supply:

Accepted Answer

A)  the equilibrium price and quantity will rise.
B)  the equilibrium quantity will rise, but the change in the equilibrium price cannot be predicted.
C)  the equilibrium price will rise, but the change in the equilibrium quantity cannot be predicted.
D)  the equilibrium price and quantity will fall.E) A) and C)
F) B) and D)

Question 15

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

Accepted Answer

A)  Consumer preferences
B)  Income of the consumers
C)  The number of sellers in the market
D)  The prices of related goodsE) A) and B)
F) All of the above

Question 16

An expectation that the price of a good will increase in the future is likely to:

Accepted Answer

A)  increase current demand.
B)  decrease current demand.
C)  have no impact on current demand.
D)  only affect the seller's decisions.E) A) and B)
F) None of the above

Question 17

Wendell just read an article claiming scientists have proven that processed cheese food increases brain power. We would expect Wendell's demand for processed cheese food to _____ and his demand curve to shift to the _____.

Accepted Answer

A)  increase; right
B)  increase; left
C)  decrease; right
D)  decrease; leftE) All of the above
F) C) and D)

Question 18

2. Which of the following is true? A) The equilibrium price will increase by $5. B) The equilibrium quantity will increase by 20 units. C) The equilibrium price will increase by $15. D) The equilibrium quantity will increase by 30 units." class="answers-bank-image d-inline" rel="preload" > The graph shown depicts the market for a good. Assume the market was originally in equilibrium where the demand curve (D) and supply curve (S) intersect. Something changes in the market, and the demand curve for the good shifts to D2. Which of the following is true?

Accepted Answer

A)  The equilibrium price will increase by $5.
B)  The equilibrium quantity will increase by 20 units.
C)  The equilibrium price will increase by $15.
D)  The equilibrium quantity will increase by 30 units.E) A) and D)
F) A) and C)

Question 19

The table shows individual demand schedules for a market. What can be said of Betty and Barney's demands for this good?

Accepted Answer

A)  Both of their demands follow the law of demand.
B)  Barney's demand follows the law of demand, but Betty's does not.
C)  Betty's demand follows the law of demand, but Barney's does not.
D)  Neither of their demands follows the law of demand.E) None of the above
F) B) and C)

Question 20

What is likely to happen if a producer incorrectly sets the price of its product too low?

Accepted Answer

A)  A shortage (excess demand) will result, and consumers will bid the price down to equilibrium.
B)  A surplus (excess supply) will result, and the additional goods in inventory will prompt the producer to raise the price.
C)  A shortage (excess demand) will result, and consumers will bid the price up to equilibrium.
D)  A surplus (excess supply) will result, and the additional goods in inventory will prompt the producer to restrict output until sales increase.E) A) and D)
F) C) and D)

Exam 3: Markets

The graph shown depicts the market for a good. Suppose the government sets the price of this good at $36. At this price, there is:

Correct Answer
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Suppose the graph shown depicts the demand for a normal good. A shift from A to B might be caused by:

Correct Answer
verified

If a producer incorrectly sets the price of its product too high:

Correct Answer
verified

Suppose the graph shown depicts the demand for a normal good. A shift from B to A might be caused by:

Correct Answer
verified

The table shows individual demand schedules for a market. What is the equilibrium price in this market?

Correct Answer
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The city of Burlington experiences very high temperatures each summer and very low temperatures each winter. We would expect the demand for ice cream to:

Correct Answer
verified

Suppose the graph shown depicts the demand for a normal good. Pasua was originally consuming at point A, but after receiving a raise at work her demand may:

Correct Answer
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Correct Answer
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Suppose the advancement of computers has decreased the productivity of a paper mill. This will likely cause _______ the supply curve for paper.

Correct Answer
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B

The table shows individual demand schedules for a market. At a price of $1.00, how much of the good will be demanded by Betty?

Correct Answer
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The prices of related goods matter when determining supply because they affect:

Correct Answer
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Equilibrium takes place where:

Correct Answer
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A

Suppose the graph shown depicts the demand for a normal good. A shift from A to B might be caused by:

Correct Answer
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C

Consider a market that is in equilibrium. If the market experiences both an increase in demand and an increase in supply:

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

Correct Answer
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An expectation that the price of a good will increase in the future is likely to:

Correct Answer
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Wendell just read an article claiming scientists have proven that processed cheese food increases brain power. We would expect Wendell's demand for processed cheese food to _ and his demand curve to shift to the _.

Correct Answer
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The graph shown depicts the market for a good. Assume the market was originally in equilibrium where the demand curve (D) and supply curve (S) intersect. Something changes in the market, and the demand curve for the good shifts to D₂. Which of the following is true?

Correct Answer
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The table shows individual demand schedules for a market. What can be said of Betty and Barney's demands for this good?

Correct Answer
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What is likely to happen if a producer incorrectly sets the price of its product too low?

Correct Answer
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Exam 3: Markets

The graph shown depicts the market for a good. Suppose the government sets the price of this good at $36. At this price, there is:

Correct AnswerverifiedShow Answer

Suppose the graph shown depicts the demand for a normal good. A shift from A to B might be caused by:

Correct AnswerverifiedShow Answer

If a producer incorrectly sets the price of its product too high:

Correct AnswerverifiedShow Answer

Suppose the graph shown depicts the demand for a normal good. A shift from B to A might be caused by:

Correct AnswerverifiedShow Answer

The table shows individual demand schedules for a market. What is the equilibrium price in this market?

Correct AnswerverifiedShow Answer

The city of Burlington experiences very high temperatures each summer and very low temperatures each winter. We would expect the demand for ice cream to:

Correct AnswerverifiedShow Answer

Suppose the graph shown depicts the demand for a normal good. Pasua was originally consuming at point A, but after receiving a raise at work her demand may:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Suppose the advancement of computers has decreased the productivity of a paper mill. This will likely cause _______ the supply curve for paper.

Correct AnswerverifiedB

The table shows individual demand schedules for a market. At a price of $1.00, how much of the good will be demanded by Betty?

Correct AnswerverifiedShow Answer

The prices of related goods matter when determining supply because they affect:

Correct AnswerverifiedShow Answer

Equilibrium takes place where:

Correct AnswerverifiedA

Suppose the graph shown depicts the demand for a normal good. A shift from A to B might be caused by:

Correct AnswerverifiedC

Consider a market that is in equilibrium. If the market experiences both an increase in demand and an increase in supply:

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

An expectation that the price of a good will increase in the future is likely to:

Correct AnswerverifiedShow Answer

Wendell just read an article claiming scientists have proven that processed cheese food increases brain power. We would expect Wendell's demand for processed cheese food to _____ and his demand curve to shift to the _____.

Correct AnswerverifiedShow Answer

The graph shown depicts the market for a good. Assume the market was originally in equilibrium where the demand curve (D) and supply curve (S) intersect. Something changes in the market, and the demand curve for the good shifts to D2. Which of the following is true?

Correct AnswerverifiedShow Answer

The table shows individual demand schedules for a market. What can be said of Betty and Barney's demands for this good?

Correct AnswerverifiedShow Answer

What is likely to happen if a producer incorrectly sets the price of its product too low?

Correct AnswerverifiedShow Answer

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B

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A

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C

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Wendell just read an article claiming scientists have proven that processed cheese food increases brain power. We would expect Wendell's demand for processed cheese food to _ and his demand curve to shift to the _.

Correct Answer
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The graph shown depicts the market for a good. Assume the market was originally in equilibrium where the demand curve (D) and supply curve (S) intersect. Something changes in the market, and the demand curve for the good shifts to D₂. Which of the following is true?

Correct Answer
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Correct Answer
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