Question 1

Figure 4-2 
-Refer to Figure 4-2. Suppose Phil and Miss Kay are the only consumers in the market. If the price is $10, then the market quantity demanded is

Accepted Answer

A)   0 units.
B)   2 units.
C)   4 units.
D)   6 units.E) B) and D)
F) None of the above

Question 2

Table 4-13
The demand schedule below pertains to sandwiches demanded per week.
 
-Refer to Table 4-13. Suppose Harry, Darby, and Jake are the only demanders of sandwiches. Also suppose the following: • x = 2.
• The current price of a sandwich is $3.00.
• The market quantity supplied of sandwiches is 4.
• The slope of the supply curve is 2.
Then there is currently a

Accepted Answer

A)   shortage of 6 sandwiches, and the equilibrium price of a sandwich is less than $3.00.
B)   shortage of 6 sandwiches, and the equilibrium price of a sandwich is $5.00.
C)   surplus of 6 sandwiches, and the equilibrium price of a sandwich is less than $3.00.
D)   surplus of 6 sandwiches, and the equilibrium price of a sandwich is $5.00.E) A) and D)
F) B) and C)

Question 3

Figure 4-22 
-Refer to Figure 4-22. At a price of $12, there is a

Accepted Answer

A)   surplus of 2 units.
B)   surplus of 4 units.
C)   shortage of 2 units.
D)   shortage of 4 units.E) A) and D)
F) C) and D)

Question 4

Price cannot fall so low that some sellers choose to supply a quantity of zero.

Accepted Answer

A) True 
 B)False

Question 5

Supply and demand together determine the price and quantity of a good sold in a market.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following events could shift the demand curve for gasoline to the left?

Accepted Answer

A)   The income of gasoline buyers rises, and gasoline is a normal good.
B)   The income of gasoline buyers falls, and gasoline is an inferior good.
C)   Public service announcements run on television encourage people to walk or ride bicycles instead of driving cars.
D)   The price of gasoline rises.E) A) and C)
F) A) and B)

Question 7

Consider the market for portable air conditioners in equilibrium. A summer of unseasonably cool weather would cause

Accepted Answer

A)   both the equilibrium price and quantity to decrease.
B)   both the equilibrium price and quantity to increase.
C)   the equilibrium price to increase and the equilibrium quantity to decrease.
D)   the equilibrium price to decrease and the equilibrium quantity to increase.E) None of the above
F) All of the above

Question 8

If toast and butter are complements, then which of the following would increase the demand for toast?

Accepted Answer

A)   a decrease in the price of toast
B)   a decrease in the price of butter
C)   an increase in the price of butter
D)   Both a and b are correct.E) B) and C)
F) All of the above

Question 9

Figure 4-20 
-Refer to Figure 4-20. If the price is $25, then there would be an excess

Accepted Answer

A)   supply of 100 units, and price would fall.
B)   supply of 300 units, and price would fall.
C)   demand of 100 units, and price would fall.
D)   demand of 300 units, and price would fall.E) B) and C)
F) A) and B)

Question 10

If, at the current price, there is a surplus of a good, then

Accepted Answer

A)   sellers are producing more than buyers wish to buy.
B)   the market must be in equilibrium.
C)   the price is below the equilibrium price.
D)   quantity demanded equals quantity supplied.E) A) and B)
F) None of the above

Question 11

Figure 4-9
Panel a)  Panel b) 
  
-Refer to Figure 4-9. The graphs show the demand for cigarettes. In Panel a) , the arrows are consistent with which of the following events?

Accepted Answer

A)   Tobacco and marijuana are complements, and the price of marijuana decreased.
B)   Tobacco is a "gateway drug," and the price of marijuana increased.
C)   The price of cigarettes increased.
D)   The arrows are consistent with all of these events.E) C) and D)
F) All of the above

Question 12

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

Accepted Answer

A)   coalition.
B)   economy.
C)   market.
D)   competition.E) B) and C)
F) All of the above

Question 13

You lose your job and, as a result, you buy fewer iTunes music downloads. This shows that you consider iTunes music downloads to be an)

Accepted Answer

A)   luxury good.
B)   inferior good.
C)   normal good.
D)   complementary good.E) A) and B)
F) None of the above

Question 14

If consumers often purchase muffins to eat while they drink their lattés at local coffee shops, what would happen to the equilibrium price and quantity of lattés if the price of muffins falls?

Accepted Answer

A)   Both the equilibrium price and quantity would increase.
B)   Both the equilibrium price and quantity would decrease.
C)   The equilibrium price would increase, and the equilibrium quantity would decrease.
D)   The equilibrium price would decrease, and the equilibrium quantity would increase.E) A) and D)
F) C) and D)

Question 15

Figure 4-18 
-Refer to Figure 4-18. At what price would there be an excess demand of 200 units of the good?

Accepted Answer

A)   $15
B)   $20
C)   $30
D)   $35E) None of the above
F) B) and C)

Question 16

If something happens to alter the quantity supplied at any given price, then we move along the fixed supply curve to a new quantity supplied.

Accepted Answer

A) True 
 B)False

Question 17

If orange juice and apple juice are substitutes, an increase in the price of orange juice will shift the demand curve for apple juice to the left.

Accepted Answer

A) True 
 B)False

Question 18

A CPA recently has come to expect higher prices for expert tax advice in the near future. We would expect

Accepted Answer

A)   the CPA to supply more expert tax advice now than she was supplying previously.
B)   the CPA to supply less expert tax advice now than she was supplying previously.
C)   the demand for this CPA's expert tax advice to fall.
D)   no change in the CPA's current supply; instead, future supply will be affected.E) B) and C)
F) B) and D)

Question 19

When we move along a given supply curve,

Accepted Answer

A)   only price is held constant.
B)   technology and price are held constant.
C)   all nonprice determinants of supply are held constant.
D)   all determinants of quantity supplied are held constant.E) A) and B)
F) All of the above

Question 20

For a competitive market,

Accepted Answer

A)   a seller can always increase her profit by raising the price of her product.
B)   if a seller charges more than the going price, buyers will go elsewhere to make their purchases.
C)   a seller often charges less than the going price to increase sales and profit.
D)   a single buyer can influence the price of the product but only when purchasing from several sellers in a short period of time.E) A) and B)
F) A) and C)

Exam 4: The Market Forces of Supply and Demand

A CPA recently has come to expect higher prices for expert tax advice in the near future. We would expect

Correct Answer
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A group of buyers and sellers of a particular good or service is called an)

Correct Answer
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Figure 4-20 -Refer to Figure 4-20. If the price is $25, then there would be an excess

Correct Answer
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Correct Answer
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Price cannot fall so low that some sellers choose to supply a quantity of zero.

Correct Answer
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Figure 4-9 Panel a) Panel b) -Refer to Figure 4-9. The graphs show the demand for cigarettes. In Panel a) , the arrows are consistent with which of the following events?

Correct Answer
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For a competitive market,

Correct Answer
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Figure 4-2 -Refer to Figure 4-2. Suppose Phil and Miss Kay are the only consumers in the market. If the price is $10, then the market quantity demanded is

Correct Answer
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If something happens to alter the quantity supplied at any given price, then we move along the fixed supply curve to a new quantity supplied.

Correct Answer
verified

If toast and butter are complements, then which of the following would increase the demand for toast?

Correct Answer
verified

If orange juice and apple juice are substitutes, an increase in the price of orange juice will shift the demand curve for apple juice to the left.

Correct Answer
verified

If, at the current price, there is a surplus of a good, then

Correct Answer
verified

If consumers often purchase muffins to eat while they drink their lattés at local coffee shops, what would happen to the equilibrium price and quantity of lattés if the price of muffins falls?

Correct Answer
verified

When we move along a given supply curve,

Correct Answer
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You lose your job and, as a result, you buy fewer iTunes music downloads. This shows that you consider iTunes music downloads to be an)

Correct Answer
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Which of the following events could shift the demand curve for gasoline to the left?

Correct Answer
verified

Consider the market for portable air conditioners in equilibrium. A summer of unseasonably cool weather would cause

Correct Answer
verified

Supply and demand together determine the price and quantity of a good sold in a market.

Correct Answer
verified

Figure 4-22 -Refer to Figure 4-22. At a price of $12, there is a

Correct Answer
verified

Figure 4-18 -Refer to Figure 4-18. At what price would there be an excess demand of 200 units of the good?

Correct Answer
verified

Exam 4: The Market Forces of Supply and Demand

A CPA recently has come to expect higher prices for expert tax advice in the near future. We would expect

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Figure 4-20 -Refer to Figure 4-20. If the price is $25, then there would be an excess

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Price cannot fall so low that some sellers choose to supply a quantity of zero.

Correct AnswerverifiedShow Answer

Figure 4-9 Panel a) Panel b) -Refer to Figure 4-9. The graphs show the demand for cigarettes. In Panel a) , the arrows are consistent with which of the following events?

Correct AnswerverifiedShow Answer

For a competitive market,

Correct AnswerverifiedShow Answer

Figure 4-2 -Refer to Figure 4-2. Suppose Phil and Miss Kay are the only consumers in the market. If the price is $10, then the market quantity demanded is

Correct AnswerverifiedShow Answer

If something happens to alter the quantity supplied at any given price, then we move along the fixed supply curve to a new quantity supplied.

Correct AnswerverifiedShow Answer

If toast and butter are complements, then which of the following would increase the demand for toast?

Correct AnswerverifiedShow Answer

If orange juice and apple juice are substitutes, an increase in the price of orange juice will shift the demand curve for apple juice to the left.

Correct AnswerverifiedShow Answer

If, at the current price, there is a surplus of a good, then

Correct AnswerverifiedShow Answer

If consumers often purchase muffins to eat while they drink their lattés at local coffee shops, what would happen to the equilibrium price and quantity of lattés if the price of muffins falls?

Correct AnswerverifiedShow Answer

When we move along a given supply curve,

Correct AnswerverifiedShow Answer

You lose your job and, as a result, you buy fewer iTunes music downloads. This shows that you consider iTunes music downloads to be an)

Correct AnswerverifiedShow Answer

Which of the following events could shift the demand curve for gasoline to the left?

Correct AnswerverifiedShow Answer

Consider the market for portable air conditioners in equilibrium. A summer of unseasonably cool weather would cause

Correct AnswerverifiedShow Answer

Supply and demand together determine the price and quantity of a good sold in a market.

Correct AnswerverifiedShow Answer

Figure 4-22 -Refer to Figure 4-22. At a price of $12, there is a

Correct AnswerverifiedShow Answer

Figure 4-18 -Refer to Figure 4-18. At what price would there be an excess demand of 200 units of the good?

Correct AnswerverifiedShow Answer

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