Question 1

In order to derive the market supply curve from individual supply curves, we add up the:

Accepted Answer

A)   Various prices that individual sellers are charging for the product
B)   Various quantities that individual sellers want to sell at specific price levels
C)   Total number of sellers in the market at a given time
D)   Costs that all individual sellers incur in producing the productE) A) and D)
F) A) and C)

Question 2

Refer to the above diagram for the milk market. There would be a shortage of milk whenever the price is:

Accepted Answer

A)   Higher than $1.50 per gallon
B)   Higher than $2.00 per gallon
C)   Lower than $1.50 per gallon
D)   Lower than $2.00 per gallonE) All of the above
F) B) and C)

Question 3

The idea of the Law of Demand, as applied to electric cars, assumes which of the following to be constant?

Accepted Answer

A)   Price of electric cars
B)   Price of gasoline cars
C)   Quantity of electric cars demanded by buyers
D)   How much sellers are charging customers for electric carsE) None of the above
F) A) and B)

Question 4

The law of supply states that, ceteris paribus, if the price of loans (known as "interest rate") rises then the quantity supplied of loans will decrease.

Accepted Answer

A) True 
 B)False

Question 5

The following are explanations of the Law of Demand, except:

Accepted Answer

A)   Expectations effect
B)   Diminishing marginal utility
C)   Income effect
D)   Substitution effectE) A) and C)
F) B) and C)

Question 6

If the demand for electronic readers and tablets increases, then their supply will increase as price rises.

Accepted Answer

A) True 
 B)False

Question 7

The table below shows the weekly demand for hamburger in a market where there are just three buyers.  Refer to the above table. At a price of $6, the weekly market quantity demanded for hamburger is:

Accepted Answer

A)   17
B)   23
C)   18
D)   24E) A) and B)
F) A) and C)

Question 8

A fall in the price of milk, used in the production of ice cream, will:

Accepted Answer

A)   Decrease the supply of ice cream
B)   Increase the supply of ice cream
C)   Cause a movement along the supply curve of ice cream
D)   Have no effect on the supply of ice creamE) A) and D)
F) A) and C)

Question 9

The graph below shows the market for tickets to a "Final Four" sports event. Assume that there is only one kind of ticket to the event.  Refer to the above market graph for tickets to a "Final Four" sports event. Given this market, if the event organizers pre-set the price at $20, then this action would result in a:

Accepted Answer

A)   Shortage of 5,000 units
B)   Shortage of 55,000 units
C)   Surplus of 5,000 units
D)   Surplus of 50,000 unitsE) None of the above
F) B) and C)

Question 10

When a fruit or vegetable (such as strawberries or lentils) is in season, the demand for it will increase as it becomes cheaper.

Accepted Answer

A) True 
 B)False

Question 11

If an economy is being "productively efficient," then that means the economy is:

Accepted Answer

A)   Producing the products most wanted by society
B)   Fully employing all economic resources
C)   Maximizing the returns to factors of production
D)   Using the least costly production techniquesE) A) and C)
F) B) and D)

Question 12

A decrease in demand and an increase in supply will:

Accepted Answer

A)   Affect price in an indeterminate way and decrease the equilibrium quantity
B)   Increase price and affect the equilibrium quantity in an indeterminate way
C)   Decrease price and affect the equilibrium quantity in an indeterminate way
D)   Increase price and increase the equilibrium quantityE) B) and C)
F) A) and B)

Question 13

An increase in the price of digital cameras will result in a(n) :

Accepted Answer

A)   Shift of the demand curve for digital cameras to the left
B)   Decrease in the demand for digital cameras
C)   Shift of the demand curve for digital cameras to the right
D)   Movement up and to the left along the demand curve for digital camerasE) None of the above
F) All of the above

Question 14

Refer to the market graph shown above. A black market where the price is $2.00 could result from price:

Accepted Answer

A)   Ceiling set at $2.50
B)   Ceiling set at $1.50
C)   Floor set at $1.50
D)   Floor set at $2.00E) B) and C)
F) A) and D)

Question 15

An effective price ceiling will lower the equilibrium price and cause a surplus.

Accepted Answer

A) True 
 B)False

Question 16

In a competitive market illustrated by the diagram above, for a price floor to be effective and alter the market situation, it must be set:

Accepted Answer

A)   At $15
B)   Below $15
C)   Above $15
D)   At $10E) A) and C)
F) B) and C)

Question 17

Suppose that a more efficient way to produce a good is discovered, thus lowering production costs for the good. This will cause a(n) :

Accepted Answer

A)   Increase in supply
B)   Decrease in supply
C)   Increase in quantity supplied
D)   Decrease in quantity suppliedE) B) and D)
F) All of the above

Question 18

1 and D2. The change in equilibrium from E1 to E2 cannot be a result of: A)  Buyers expectations of lower prices for beef in the very near future B)  An increase in the subsidy given to cattle farms C)  A widespread concern about mad-cow disease D)  A decrease in the productivity of cattle farms" class="answers-bank-image d-inline" rel="preload" > Refer to the above graph, which shows the market for beef where demand shifted from D1 and D2. The change in equilibrium from E1 to E2 cannot be a result of:

Accepted Answer

A)   Buyers expectations of lower prices for beef in the very near future
B)   An increase in the subsidy given to cattle farms
C)   A widespread concern about mad-cow disease
D)   A decrease in the productivity of cattle farmsE) B) and C)
F) A) and B)

Question 19

Which of the following pairs are not considered to be complementary goods?

Accepted Answer

A)   Steel and cars
B)   Digital cameras and memory cards
C)   Gasoline and motor oil
D)   Fertilizer and irrigation systemsE) All of the above
F) A) and B)

Question 20

The market system automatically corrects a surplus condition in a competitive market by:

Accepted Answer

A)   Raising the price of the commodity in question while increasing the quantity demanded
B)   Raising the price of the commodity in question while decreasing the quantity demanded
C)   Reducing the price of the commodity in question while increasing the quantity demanded
D)   Reducing the price of the commodity in question while decreasing the quantity demandedE) B) and C)
F) A) and B)

Exam 3: Demand, Supply, and Market Equilibrium

Refer to the market graph shown above. A black market where the price is $2.00 could result from price:

Correct Answer
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The table below shows the weekly demand for hamburger in a market where there are just three buyers. Refer to the above table. At a price of $6, the weekly market quantity demanded for hamburger is:

Correct Answer
verified

The market system automatically corrects a surplus condition in a competitive market by:

Correct Answer
verified

Refer to the above diagram for the milk market. There would be a shortage of milk whenever the price is:

Correct Answer
verified

When a fruit or vegetable (such as strawberries or lentils) is in season, the demand for it will increase as it becomes cheaper.

Correct Answer
verified

Correct Answer
verified

In order to derive the market supply curve from individual supply curves, we add up the:

Correct Answer
verified

If the demand for electronic readers and tablets increases, then their supply will increase as price rises.

Correct Answer
verified

An increase in the price of digital cameras will result in a(n) :

Correct Answer
verified

An effective price ceiling will lower the equilibrium price and cause a surplus.

Correct Answer
verified

Which of the following pairs are not considered to be complementary goods?

Correct Answer
verified

A fall in the price of milk, used in the production of ice cream, will:

Correct Answer
verified

The following are explanations of the Law of Demand, except:

Correct Answer
verified

Suppose that a more efficient way to produce a good is discovered, thus lowering production costs for the good. This will cause a(n) :

Correct Answer
verified

In a competitive market illustrated by the diagram above, for a price floor to be effective and alter the market situation, it must be set:

Correct Answer
verified

A decrease in demand and an increase in supply will:

Correct Answer
verified

The law of supply states that, ceteris paribus, if the price of loans (known as "interest rate") rises then the quantity supplied of loans will decrease.

Correct Answer
verified

If an economy is being "productively efficient," then that means the economy is:

Correct Answer
verified

The idea of the Law of Demand, as applied to electric cars, assumes which of the following to be constant?

Correct Answer
verified

Refer to the above graph, which shows the market for beef where demand shifted from D₁ and D₂. The change in equilibrium from E₁ to E₂ cannot be a result of:

Correct Answer
verified

Exam 3: Demand, Supply, and Market Equilibrium

Refer to the market graph shown above. A black market where the price is $2.00 could result from price:

Correct AnswerverifiedShow Answer

The table below shows the weekly demand for hamburger in a market where there are just three buyers. Refer to the above table. At a price of $6, the weekly market quantity demanded for hamburger is:

Correct AnswerverifiedShow Answer

The market system automatically corrects a surplus condition in a competitive market by:

Correct AnswerverifiedShow Answer

Refer to the above diagram for the milk market. There would be a shortage of milk whenever the price is:

Correct AnswerverifiedShow Answer

When a fruit or vegetable (such as strawberries or lentils) is in season, the demand for it will increase as it becomes cheaper.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

In order to derive the market supply curve from individual supply curves, we add up the:

Correct AnswerverifiedShow Answer

If the demand for electronic readers and tablets increases, then their supply will increase as price rises.

Correct AnswerverifiedShow Answer

An increase in the price of digital cameras will result in a(n) :

Correct AnswerverifiedShow Answer

An effective price ceiling will lower the equilibrium price and cause a surplus.

Correct AnswerverifiedShow Answer

Which of the following pairs are not considered to be complementary goods?

Correct AnswerverifiedShow Answer

A fall in the price of milk, used in the production of ice cream, will:

Correct AnswerverifiedShow Answer

The following are explanations of the Law of Demand, except:

Correct AnswerverifiedShow Answer

Suppose that a more efficient way to produce a good is discovered, thus lowering production costs for the good. This will cause a(n) :

Correct AnswerverifiedShow Answer

In a competitive market illustrated by the diagram above, for a price floor to be effective and alter the market situation, it must be set:

Correct AnswerverifiedShow Answer

A decrease in demand and an increase in supply will:

Correct AnswerverifiedShow Answer

The law of supply states that, ceteris paribus, if the price of loans (known as "interest rate") rises then the quantity supplied of loans will decrease.

Correct AnswerverifiedShow Answer

If an economy is being "productively efficient," then that means the economy is:

Correct AnswerverifiedShow Answer

The idea of the Law of Demand, as applied to electric cars, assumes which of the following to be constant?

Correct AnswerverifiedShow Answer

Refer to the above graph, which shows the market for beef where demand shifted from D1 and D2. The change in equilibrium from E1 to E2 cannot be a result of:

Correct AnswerverifiedShow Answer

Correct Answer
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Refer to the above graph, which shows the market for beef where demand shifted from D₁ and D₂. The change in equilibrium from E₁ to E₂ cannot be a result of:

Correct Answer
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