Question 1

In competitive markets,

Accepted Answer

A)   firms produce identical products.
B)   no individual buyer can influence the market price.
C)   no individual seller can influence the market price.
D)   All of the above are correct.E) C) and D)
F) B) and C)

Question 2

Recent forest fires in the western states are expected to cause the price of lumber to rise in the next six months. As a result, we can expect the supply of lumber to

Accepted Answer

A)   fall in six months but not now.
B)   increase in six months when the price goes up.
C)   fall now.
D)   increase now to meet as much demand as possible.E) All of the above
F) A) and D)

Question 3

Another term for equilibrium price is

Accepted Answer

A)   dynamic price.
B)   market-clearing price.
C)   quantity-defining price.
D)   balance price.E) C) and D)
F) B) and C)

Question 4

Table 4-14
The table below shows the quantities demanded of milk per month by four families at various prices.
 
-Refer to Table 4-14. If the four families listed are the only demanders in this market and the price of a gallon of milk is $4.00, what is the market quantity demanded?

Accepted Answer

The answer of Table 4-14
The table below shows the quantities...

Question 5

Good X and good Y are substitutes. If the price of good Y increases, then the

Accepted Answer

A)   demand for good X will decrease.
B)   quantity demanded of good X will decrease.
C)   demand for good X will increase.
D)   quantity demanded of good X will increase.E) B) and D)
F) B) and C)

Question 6

The law of demand is true for most goods in the economy.

Accepted Answer

A) True 
 B)False

Question 7

A table that shows the relationship between the price of a good and the quantity demanded of that good is called a

Accepted Answer

A)   price-quantity schedule.
B)   buyer schedule.
C)   demand schedule.
D)   demand curve.E) All of the above
F) A) and D)

Question 8

You wear either shorts or sweatpants every day. You notice that sweatpants have gone on sale, so your demand for

Accepted Answer

A)   sweatpants will increase.
B)   sweatpants will decrease.
C)   shorts will increase.
D)   shorts will decrease.E) B) and C)
F) C) and D)

Question 9

The market supply curve

Accepted Answer

A)   is found by vertically adding the individual supply curves.
B)   slopes downward.
C)   represents the sum of the prices that all the sellers are willing to accept for a given quantity of the good.
D)   represents the sum of the quantities supplied by all the sellers at each price of the good.E) B) and D)
F) B) and C)

Question 10

The demand curve for a good is a line that relates

Accepted Answer

A)   price and quantity demanded.
B)   income and quantity demanded.
C)   quantity demanded and quantity supplied.
D)   price and income.E) All of the above
F) B) and C)

Question 11

Which of the following events could cause an increase in the supply of ceiling fans?

Accepted Answer

A)   The number of sellers of ceiling fans increases.
B)   There is an increase in the price of air conditioners, and consumers regard air conditioners and ceiling fans as substitutes.
C)   There is an increase in the price of the motor that powers ceiling fans.
D)   All of the above are correct.E) A) and B)
F) A) and D)

Question 12

Which of the following events would cause a movement upward and to the left along the demand curve for olives?

Accepted Answer

A)   The number of people who purchase olives decreases.
B)   Consumer income decreases, and olives are a normal good.
C)   The price of pickles decreases, and pickles are a substitute for olives.
D)   The price of olives rises.E) A) and B)
F) B) and C)

Question 13

Figure 4-15 
-Refer to Figure 4-15. Which of the following would cause the supply curve to shift from Supply B to Supply A in the market for butter?

Accepted Answer

A)   a decrease in the price of butter
B)   an increase in the price of margarine
C)   an increase in the price of milk
D)   an improvement in technology that allows firms to use less labor in the production of butterE) C) and D)
F) All of the above

Question 14

All goods and services are sold in perfectly competitive markets.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following changes would not shift the demand curve for a good or service?

Accepted Answer

A)   a change in income
B)   a change in the price of the good or service
C)   a change in expectations about the future price of the good or service
D)   a change in the price of a related good or serviceE) C) and D)
F) B) and D)

Question 16

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

Question 17

If a shortage exists in a market, then we know that the actual price is

Accepted Answer

A)   above the equilibrium price, and quantity supplied is greater than quantity demanded.
B)   above the equilibrium price, and quantity demanded is greater than quantity supplied.
C)   below the equilibrium price, and quantity demanded is greater than quantity supplied.
D)   below the equilibrium price, and quantity supplied is greater than quantity demanded.E) A) and D)
F) A) and C)

Question 18

A decrease in the price of sugar will shift the supply curve for cookies to the right.

Accepted Answer

A) True 
 B)False

Exam 4: The Market Forces of Supply and Demand

A table that shows the relationship between the price of a good and the quantity demanded of that good is called a

Correct Answer
verified

The law of demand is true for most goods in the economy.

Correct Answer
verified

The demand curve for a good is a line that relates

Correct Answer
verified

Figure 4-15 -Refer to Figure 4-15. Which of the following would cause the supply curve to shift from Supply B to Supply A in the market for butter?

Correct Answer
verified

You wear either shorts or sweatpants every day. You notice that sweatpants have gone on sale, so your demand for

Correct Answer
verified

If a shortage exists in a market, then we know that the actual price is

Correct Answer
verified

All goods and services are sold in perfectly competitive markets.

Correct Answer
verified

The market supply curve

Correct Answer
verified

Which of the following events could cause an increase in the supply of ceiling fans?

Correct Answer
verified

In competitive markets,

Correct Answer
verified

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

Correct Answer
verified

A decrease in the price of sugar will shift the supply curve for cookies to the right.

Correct Answer
verified

Table 4-14 The table below shows the quantities demanded of milk per month by four families at various prices. -Refer to Table 4-14. If the four families listed are the only demanders in this market and the price of a gallon of milk is $4.00, what is the market quantity demanded?

Correct Answer
verified

Good X and good Y are substitutes. If the price of good Y increases, then the

Correct Answer
verified

Which of the following changes would not shift the demand curve for a good or service?

Correct Answer
verified

Which of the following events would cause a movement upward and to the left along the demand curve for olives?

Correct Answer
verified

Recent forest fires in the western states are expected to cause the price of lumber to rise in the next six months. As a result, we can expect the supply of lumber to

Correct Answer
verified

Another term for equilibrium price is

Correct Answer
verified

Exam 4: The Market Forces of Supply and Demand

A table that shows the relationship between the price of a good and the quantity demanded of that good is called a

Correct AnswerverifiedShow Answer

The law of demand is true for most goods in the economy.

Correct AnswerverifiedShow Answer

The demand curve for a good is a line that relates

Correct AnswerverifiedShow Answer

Figure 4-15 -Refer to Figure 4-15. Which of the following would cause the supply curve to shift from Supply B to Supply A in the market for butter?

Correct AnswerverifiedShow Answer

You wear either shorts or sweatpants every day. You notice that sweatpants have gone on sale, so your demand for

Correct AnswerverifiedShow Answer

If a shortage exists in a market, then we know that the actual price is

Correct AnswerverifiedShow Answer

All goods and services are sold in perfectly competitive markets.

Correct AnswerverifiedShow Answer

The market supply curve

Correct AnswerverifiedShow Answer

Which of the following events could cause an increase in the supply of ceiling fans?

Correct AnswerverifiedShow Answer

In competitive markets,

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

A decrease in the price of sugar will shift the supply curve for cookies to the right.

Correct AnswerverifiedShow Answer

Table 4-14 The table below shows the quantities demanded of milk per month by four families at various prices. -Refer to Table 4-14. If the four families listed are the only demanders in this market and the price of a gallon of milk is $4.00, what is the market quantity demanded?

Correct AnswerverifiedShow Answer

Good X and good Y are substitutes. If the price of good Y increases, then the

Correct AnswerverifiedShow Answer

Which of the following changes would not shift the demand curve for a good or service?

Correct AnswerverifiedShow Answer

Which of the following events would cause a movement upward and to the left along the demand curve for olives?

Correct AnswerverifiedShow Answer

Recent forest fires in the western states are expected to cause the price of lumber to rise in the next six months. As a result, we can expect the supply of lumber to

Correct AnswerverifiedShow Answer

Another term for equilibrium price is

Correct AnswerverifiedShow Answer

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