Quiz 4: Demand,supply,and Market Equilibrium

A perfectly competitive market is a market that has: A)many buyers. B)many sellers. C)no single buyer or seller who can affect the price. D)All of the above are correct.

If a competitive market operates perfectly,it relies on: A)the number of people buying goods. B)the laws of supply and demand. C)how many products can be produced for sale. D)how much people are willing to pay for the products.

The quantity of a product that consumers are willing and able to buy at a given price is called the: A)quantity demanded. B)quantity supplied. C)demand for a good. D)demand schedule.

Quantity demanded is defined as the: A)quantity of a product that consumers are willing and able to buy at a given price. B)quantity of a product that sellers are willing and able to buy at a given level of income. C)quantity of a product that consumers and producers are willing and able to buy,given their level of preference. D)quantity of a product that consumers are willing and able to sell at a given price.

A change in the quantity demanded of a product is the result of a change in: A)the price of the product. B)the price of related goods. C)consumer income. D)the cost of producing the product.

A change in the quantity demanded of a product cannot be the result of a change in: A)the buyer's preference. B)the price of related goods. C)consumer income. D)All of the above are correct.

When a demand curve is drawn,which of the following is held constant? A)people's income B)people's preferences C)prices of related goods D)All of the above are held constant when constructing a demand curve.

When a demand curve is drawn,which of the following is NOT held constant? A)people's income B)people's preferences C)prices of related goods D)the price of the good

A demand curve is defined as the relationship between: A)the price of a good and the quantity of that good that consumers are willing to buy. B)the price of a good and the quantity of that good that producers are willing to sell. C)the income of consumers and the quantity of a good that consumers are willing to buy. D)the income of consumers and the quantity of a good that producers are willing to sell.

The law of demand states that the quantity demanded of a product increases as: A)consumer income rises. B)the prices of other products fall. C)the price of the product rises. D)the price of the product falls.

Typically,a demand curve will represent what relationship? A)the current desire for purchases of fad products as opposed to other products B)how much the products costs and the quantity of it produced C)how many people are willing to buy and the quantities each will purchase D)the price and the quantity demanded by the buyers

The law of demand can be defined as: A)a lot of people wanting the same thing. B)the higher the price,the smaller the quantity demanded,ceteris paribus. C)people are willing to make limited sacrifices to acquire products. D)none of the above.

In considering the relationships between price and quantity demanded,ceteris paribus means economists assume that: A)price increases affect quantity. B)quantity increases affect prices. C)either price or quantity can affect demand. D)all other variables remain unchanged.

When there is a change in the quantity demanded it means that the: A)hours the customer can buy products each day have increased. B)number of products in inventory have increased. C)quantity a consumer is willing to buy changes when the price changes. D)selling price of the products has not changed.

The market demand curve: A)shows the relationship between the price of a good and the quantity that all consumers together are willing to buy. B)is drawn assuming that variables such as income and tastes are fixed. C)is drawn assuming that the number of consumers is fixed. D)all of the above

Suppose that there are only three consumers of a product.At a price of $3 per unit,the first consumer would buy 6 units of the product,the second consumer would buy 5 units,and the third consumer would buy 7 units of the product.If you drew a market demand curve for this product,the quantity demanded at a price of $3 would be: A)18 units. B)11 units. C)13 units. D)unable to be determined based on the information provided.

The market demand curve is: A)negatively sloped. B)upward sloping. C)always vertical D)always horizontal.

The market demand curve is: A)downward sloping and is flatter than an individual's demand curve. B)upward sloping and is flatter than an individual's demand curve. C)downward sloping and is steeper than an individual's demand curve. D)upward sloping and is steeper than an individual's demand curve.

Figure 4.1 -Refer to Figure 4.1 that shows Mary and Tom's individual demand curves for meals per week at Fratelli's Italian Restaurant.Assuming Mary and Tom are the only consumers in the market,what is the market quantity demanded at a price of $15? A)1 B)2 C)3 D)9

Figure 4.1 -Refer to Figure 4.1 that shows Mary and Tom's individual demand curves for meals per week at Fratelli's Italian Restaurant.Assuming Mary and Tom are the only consumers in the market,what is the market quantity demanded at a price of $10? A)2 B)4 C)6 D)8

Figure 4.1 -Refer to Figure 4.1 that shows Mary and Tom's individual demand curves for meals per week at Fratelli's Italian Restaurant.Assuming Mary and Tom are the only consumers in the market,if the market quantity demanded is 6,the price must be: A)$5. B)$10. C)$15. D)$20.

Figure 4.1 -Refer to Figure 4.1 that shows Mary and Tom's individual demand curves for meals per week at Fratelli's Italian Restaurant.Assuming Mary and Tom are the only consumers in the market,if the market quantity demanded is 3 the price must be: A)$5. B)$10. C)$15. D)$20.

Figure 4.1 -Refer to Figure 4.1 that shows Mary and Tom's individual demand curves for meals per week at Fratelli's Italian Restaurant.Assuming Mary and Tom are the only consumers in the market,if the market quantity demanded is 9 the price must be: A)$5. B)$10. C)$15. D)$20.

In the application,what was the reason why the government decreased the tax rates of cigarettes? A)to discourage smuggling of cigarettes from the United States B)to encourage smoking C)to discourage smoking D)to give in to consumer demands of lower taxes in the country.

In the application,what was/were the reason(s)why a lower price of cigarettes will increase the quantity demanded for cigarettes? A)lower prices make current smokers smoke more cigarettes. B)lower prices encourage people to start smoking. C)lower prices encourage people to quit smoking. D)A and B are both correct.

In the application,when the government lowered the price of cigarettes by lowering the tax rates,the response of the consumer was: A)an increase in quantity demanded. B)an increase in demand. C)a decrease in demand. D)a decrease in quantity demanded.

The model of supply and demand is the most important tool of economic analysis.

As the price of a product rises,the demand for the product falls.

The substitution effect of a price change implies that as the price of a good falls,people are likely to buy less of the good whose price has fallen.

On the "demand side" of a market,consumers indicate to producers what they are willing to buy,in what quantity,and at what price.

The market demand curve shows the relationship between the price and the quantity demanded by all consumers,everything else being equal.

Suppose that the price of apples decreases and the quantity of apples in the market decreases.Suggest two reasons why this might have happened.

What is a "change in quantity demanded"? How is a "change in quantity demanded" illustrated in a demand diagram?

What is the "law of demand"?

What is the difference between an "individual demand curve" and a "market demand curve"?

Between an "individual demand curve" and a "market demand curve," which one has a steeper slope?

A supply curve is defined as the relationship between: A)the price of a good and the quantity that consumers are willing to buy. B)the price of a good and the quantity that producers are willing to sell. C)the income of consumers and the quantity of a product that consumers are willing to buy. D)the income of consumers and the quantity of a product that producers are willing to sell.

A table that shows the price of a product and the quantity of that product that a seller is willing to sell is called the: A)supply schedule. B)supply curve. C)demand schedule. D)demand curve.

The law of supply states that: A)firms supply more of a product as consumer income rises. B)firms supply more of a product as consumer income falls. C)firms supply more of a product as the price of the product rises. D)firms supply more of a product as the price of the product falls.

If the law of supply holds,then the supply curve can never: A)slope downwards. B)be concave. C)shift to the right. D)shift to the left.

When a supply curve is drawn,which of the following is held constant? A)the amount of taxes or subsidies that a firm pays or receives B)the number of sellers in a market C)prices of inputs D)All of the above are held constant when constructing a supply curve.

When a supply curve is drawn,which of the following is NOT held constant? A)taxes and subsidies B)the state of production technology C)prices of inputs D)the price of the good

A minimum supply price is defined as: A)the lowest price at which a product is made available for sale. B)the lowest price at which a product is bought. C)the lowest cost to produce a good. D)the lowest price at which other sellers also want to sell the good.

If a computer company will sell a laptop only if the price is $400 or higher,then $400 is known as: A)the minimum supply price. B)the input cost price. C)the minimum production cost. D)the minimum average cost.

The market supply curve for a particular good: A)shows the relationship between the price of the good and the quantity that all producers together are willing to sell. B)is drawn assuming that the other variables besides product price that affect supply are fixed. C)is drawn assuming that the number of producers is fixed. D)all of the above

If at a price of $1000,8 different laptop manufacturers are willing to sell 20 laptops each.If the 8 manufacturers are the only sellers of laptops in the market,then at a price of $1000,there are ________ laptops supplied in the market. A)160 B)8 C)20 D)820

At a price of $1000,Dell Computer Co.is willing to sell 20 laptops and Compaq is willing to sell 40 laptops.IBM will only sell laptops if the price is $1300 or higher.At $1000,the market supply for laptops is: A)60. B)800. C)20. D)40.

At a price of $1000,Dell Computer Co.is willing to sell 20 laptops and Compaq is willing to sell 40 laptops.IBM will only sell laptops if the price is $1300 or higher.From the point of view of IBM,$1300 is the: A)minimum supply price. B)minimum cost. C)the equilibrium price. D)minimum loss price.

The market supply curve is: A)negatively sloped. B)upward sloping. C)always vertical. D)always horizontal.

The market supply curve is: A)downward sloping and is flatter than an individual's supply curve. B)upward sloping and is flatter than an individual's supply curve. C)downward sloping and is steeper than an individual's supply curve. D)upward sloping and is steeper than an individual's supply curve.

Why is the market supply curve positively sloped? A)At a higher price,more firms enter the market willing to sell the product or service. B)At a higher price,fewer firms enter the market willing to sell the product or service. C)At a higher price,the firms already in the market and are willing to sell a larger quantity of the product or service. D)Both A and C are correct.

Suppose that the price for fully electric vehicle made by Toyota increases.The quantity of fully electric cars sold in the market will: A)increase,because Toyota would be willing to sell more fully electric vehicles. B)decrease,because Toyota believes that to maintain the higher prices,it must sell a smaller quantity. C)increase,because other auto manufacturers would want to enter the market and also sell fully electric vehicles. D)Both A and C are correct.

According to the Application,which of the following is the most likely reason for the falling prices of wool worldwide? A)lower demand for wool B)the law of supply C)higher demand for wool D)lower quantity supplied of wool

According to the Application,which of the following is the result of the falling prices of wool worldwide? A)lower demand for wool. B)higher demand for synthetic fibers. C)higher demand for wool. D)lower quantity supplied of wool.

According to the Application,the policies proposed to help raise the price of wool focuses on: A)lowering the demand for wool. B)raising the supply for synthetic fibers. C)raising the demand for wool. D)raising the supply for wool.

According to the Application,why might introducing sheep shearing not be an effective policy to raise wool prices? A)Increased sheep shearing might decrease the demand for wool. B)Increased sheep searing might increase the demand for wool substitutes. C)Increased sheep shearing will definitely increase the demand for wool,causing the prices to drop. D)Increased sheep shearing will definitely increase the supply of wool,causing the prices to drop.

As the price of a product rises,the quantity supplied increases.

On the "supply side" of a market,producers indicate to consumers what they are willing to sell,in what quantity,and at what price.

Suppose that the quantity supplied of pizza exceeds the quantity demanded for pizza.We would expect that: A)the price of pizza will increase. B)the price of pizza will decrease. C)the supply will decrease to meet the demand. D)the demand will increase to meet the supply.

If we observe that the price is rising in the sugar market,it could be due to: A)an excess supply of sugar. B)an excess demand for sugar. C)an increase in the supply of sugar. D)a decrease in the demand for sugar.

When consumers are willing to buy more than producers are willing to sell: A)there is excess supply of the product in the market. B)there is excess demand for the product in the market. C)the market is in equilibrium. D)the demand curve will shift until the quantity supplied equals the quantity demanded.

What happens if the price of a product is below the equilibrium price? A)The buyers will stop purchasing a "cheap" product. B)The producer will lower the price to make more profit. C)There will be an excess demand for the product. D)none of the above

Suppose that the current price in a market for Pizza is $9.At that price,the quantity demanded is 519 and the quantity supplied is 400.At the current price,the market is experiencing: A)an excess demand of 119 pizzas. B)an equilibrium. C)an excess supply of $119. D)an excess demand of 500 pizzas.

Suppose that the current price in a market for Pizza is $9.At that price,the quantity demanded is 519 and the quantity supplied is 400.In this market,we would expect that: A)the price of pizzas would increase. B)the price of pizzas would decrease. C)buyers would want to buy more pizza in the future. D)sellers would want to sell fewer pizzas in the future.

Suppose that the quantity demanded for cars exceeds the quantity supplied of cars.We would expect that: A)the price of cars will increase. B)the price of cars will decrease. C)the supply will increase to meet the demand. D)the demand will decrease to meet the supply.

Suppose that the quantity supplied of cars exceeds the quantity of cars demanded.We would expect that: A)the price of cars will increase. B)the price of cars will decrease. C)the supply will increase to meet the demand. D)the demand will decrease to meet the supply.

Suppose that a market for a product is in equilibrium at a price of $5 per unit.At any price above $5 per unit: A)there will be an excess demand for the product. B)there will be an excess supply of the product. C)the quantity supplied of the product will be greater than the quantity demanded of that product. D)both B and C.

Suppose that a market for a product is in equilibrium at a price of $5 per unit.At any price below $5 per unit: A)there will be an excess demand for the product. B)there will be an excess supply of the product. C)the quantity supplied of the product will be greater than the quantity demanded of that product. D)both B and C.

Figure 4.2 -In Figure 4.2,which of the panels depicts a market in which there is an excess demand for a product? A)Panel A B)Panel B C)Panel C D)None of the panels depicts a market in which there is an excess demand for a product.

Figure 4.2 -In Figure 4.2,which of the panels depicts a market in which there is an excess supply of a product? A)Panel A B)Panel B C)Panel C D)None of the panels depicts a market in which there is an excess supply of a product.

Figure 4.2 -Figure 4.2 depicts three market situations.Which of the panels depicts a market in which the price is likely to rise? A)Panel A B)Panel B C)Panel C D)None of the panels depicts a market in which the price is likely to rise.

Figure 4.2 -Figure 4.2 depicts three market situations.Which of the panels depicts a market in which the price is likely to fall? A)Panel A B)Panel B C)Panel C D)None of the panels depicts a market in which the price is likely to fall.

Figure 4.3 -Figure 4.3 illustrates the supply and demand for blue jeans.If the actual price of blue jeans is $30,there is: A)excess demand of 40 pairs of blue jeans. B)excess supply of 40 pairs of blue jeans. C)excess demand of 50 pairs of blue jeans. D)excess supply of 50 pairs of blue jeans.

Figure 4.3 -Figure 4.3 illustrates the supply and demand for blue jeans.If the actual price of blue jeans is $50,there is: A)excess demand of 40 pairs of blue jeans. B)excess supply of 40 pairs of blue jeans. C)excess demand of 50 pairs of blue jeans. D)excess supply of 50 pairs of blue jeans.

Figure 4.3 -Figure 4.3 illustrates the supply and demand for blue jeans.If the actual price of blue jeans is $30,we would expect the price of blue jeans to ________,the quantity demanded of blue jeans to ________,and the quantity supplied of blue jeans ________. A)increase;increase;increase B)increase;decrease;increase C)decrease;increase;decrease D)decrease;decrease;increase

Figure 4.3 -Figure 4.3 illustrates the supply and demand for blue jeans.If the actual price of blue jeans is $50,we would expect the price of blue jeans to ________,the quantity demanded of blue jeans to ________,and the quantity supplied of blue jeans to ________. A)increase;increase;increase B)increase;decrease;increase C)decrease;increase;decrease D)decrease;decrease;increase

Figure 4.3 -Figure 4.3 illustrates the supply and demand for blue jeans.If the actual price of blue jeans is $30,we would expect that: A)demand will decrease until quantity demanded equals quantity supplied. B)supply will increase until quantity demanded equals quantity supplied. C)price will increase until quantity demanded equals quantity supplied. D)there will be no change since the market is in equilibrium.

Figure 4.3 -Figure 4.3 illustrates the supply and demand for blue jeans.If the actual price of blue jeans is $50,we would expect that: A)demand will increase until quantity demanded equals quantity supplied. B)supply will decrease until quantity demanded equals quantity supplied. C)price will decrease until quantity demanded equals quantity supplied. D)no change will occur since the market is in equilibrium.

A government sometimes creates an excess supply of a product by setting a minimum price at which the product may be sold to consumers.This is sometimes called a: A)price ceiling. B)price floor. C)tax. D)none of the above

Rent control is an example of the government imposing: A)a price ceiling. B)an equilibrium price. C)a price floor. D)a minimum supply price.

If the government imposes a price ceiling that is above the equilibrium price,then the market will experience: A)an equilibrium. B)a shortage. C)an excess supply. D)no scarcity.

If the government imposes a price ceiling that is below the equilibrium price,then the market will experience: A)an equilibrium. B)a shortage. C)an excess supply. D)no scarcity.

If the government imposes a price floor that is below the equilibrium price,then the market will experience: A)an equilibrium. B)a shortage. C)an excess supply. D)no scarcity.

If the government imposes a price floor that is above the equilibrium price,then the market will experience: A)an equilibrium. B)a shortage. C)an excess supply. D)an increase in demand.

Suppose that the equilibrium rent for apartments in San Francisco is $1200 per month.If the City of San Francisco legislates that apartment owners cannot charge rent higher than $1000,then the apartment market in San Francisco will experience: A)an equilibrium. B)a shortage. C)an excess supply. D)an increase in supply.

Suppose that the equilibrium rent for apartments in San Francisco is $1200 per month.If the City of San Francisco legislates that apartment owners cannot charge rent higher than $1900,then the apartment market in San Francisco will experience: A)an equilibrium. B)a shortage. C)an excess supply. D)an increase in supply.

From the Application,we can infer that the presence of wine lakes indicate that the market is experiencing: A)an equilibrium. B)a shortage. C)a surplus. D)All of the above are correct.

From the Application,we can infer that if the government stops intervening in the market,then the: A)prices will drop. B)prices will rise. C)the supply will decrease. D)the demand will increase.

From the Application,we can infer that the wine lakes will grow faster if: A)the government set minimum prices further above the equilibrium. B)the government set maximum prices further below the equilibrium. C)the government set maximum prices further above the equilibrium. D)the government set minimum prices further below the equilibrium.

From the Application,we can infer that the wine lakes will disappear if: A)the government set the price at the equilibrium. B)the government set minimum prices below the equilibrium. C)the government set maximum prices above the equilibrium. D)All of the above are correct.

From the Application,we can infer that the wine lakes will disappear if: A)the government set the minimum price below the equilibrium. B)the government set minimum prices above the equilibrium. C)the government takes over the production of wine. D)All of the above are correct.

Minimum wage laws are examples of: A)price ceilings. B)equilibrium prices. C)price floors. D)minimum supply prices.

Excess supply in an unregulated market will cause the price of a product to fall.

Excess demand in an unregulated market will cause the price of a product to fall.

If a market is in equilibrium,there is not any pressure to change the price upward or downward.Is this a true or false assumption?

Governments occasionally get involved in creating a market equilibrium by setting a maximum price that is less than the equilibrium price,resulting in a permanent excess demand for the products.

________ occurs in a market when consumers are willing to buy more than producers are willing to sell,or can supply

When the quantity of a product demanded by buyers equals the quantity supplied,it is called ________.

If a government creates an excess demand for a product by setting a maximum price,it is sometimes called a ________.

A surplus occurs when producers are willing to sell more than consumers are willing to buy.This is called an ________.

A permanent excess supply of a product is possible when the government sets a minimum price that is ________ than the equilibrium price.

Explain how an excess supply would lead to a decrease in prices in an unregulated market.

Explain how an excess demand would lead to an increase in prices in an unregulated market.

Judy demands more peanuts as her income increases.From this,we can conclude that,for Judy: A)peanuts are a normal good. B)peanuts are an inferior good. C)peanuts are a complementary good. D)peanuts are a substitute good.

When Mary's income increases,she purchases fewer hamburgers.We can conclude that for Mary,hamburger is a(n)________ good. A)normal B)inferior C)substitute D)complementary

When Tom's income decreases,he purchases more hamburgers.We can conclude that for Tom,hamburger is a(n)________ good. A)substitute B)complementary C)normal D)inferior

Becky demands more raisins as her income increases.From this,we can conclude that,for Becky: A)raisins are an inferior good. B)raisins are a complementary good. C)raisins are a normal good. D)raisins are a substitute good.

A normal good is defined as a good for which demand decreases when: A)the price increases. B)income increases. C)the price decreases. D)income decreases.

Two goods are substitutes if: A)the supply of one good decreases when the price of the other increases. B)the supply of one good decreases when the price of the other decreases. C)the demand for one good decreases when the price of the other increases. D)the demand for one good decreases when the price of the other decreases.

The effect of income on the demand for normal goods is such that: A)as the price of a normal good falls,people are likely to buy less of the good. B)as the price of a good falls,people are likely to buy more of all normal goods. C)as the price of a good falls,people are likely to buy less of all normal goods. D)both A and C

If an increase in income results in a decrease in the demand for Honda Civics,then Honda Civics are considered: A)normal goods. B)inferior goods. C)substitute goods. D)complementary goods.

If an increase in income results in an increase in the demand for Honda Civics,then Honda Civics are considered: A)normal goods. B)inferior goods. C)substitute goods. D)complementary goods.

If incomes increase and Honda Civics are considered normal goods,then: A)the demand for Honda Civics will increase. B)the quantity demanded for Honda Civics will increase. C)the demand for Honda Civics will decrease. D)the quantity demanded for Honda Civics will decrease.

Relative to hotdogs,hotdog buns are considered: A)complements. B)substitutes. C)inputs. D)luxury goods.

Which of the following are most likely to be considered substitutes to pizzas? A)hamburgers B)cheese C)pepperoni D)soda

Which of the following is the least likely complement for hamburgers? A)beef B)cheese C)hamburger buns D)soda

Which of the following is the most likely complement for hamburgers? A)soda B)beef C)hamburger buns D)All of the above are complements.

If incomes increase and Honda Civics are considered inferior goods,then: A)the demand for Honda Civics will increase. B)the quantity demanded for Honda Civics will increase. C)the demand for Honda Civics will decrease. D)the quantity demanded for Honda Civics will decrease.

As consumers prefer smaller and more fuel-efficient cars,the: A)demand for SUVs will decrease. B)quantity demanded for SUVs will rise. C)demand for SUVs will increase. D)quantity demanded for SUVs will fall.

Assume that butter and margarine are substitutes.When the price of butter increases: A)the demand for margarine increases. B)the demand for margarine decreases. C)the supply of margarine increases. D)the supply of margarine decreases.

When the price of apples goes up: A)the demand for apples will decrease. B)the demand for apples will increase. C)the quantity demanded for apples will decrease. D)the quantity demanded for apples will increase.

Assume that chicken and beef are substitutes.When the price of beef increases: A)the demand for chicken decreases. B)the demand for chicken increases. C)the supply of chicken increases. D)the supply of chicken decreases.

When the price of peanuts falls: A)the demand for peanuts decreases. B)the demand for peanuts increases. C)the quantity demanded of peanuts decreases. D)the quantity demanded of peanuts increases.

Assume that compact discs and compact disc players are complements.When the price of compact disc players decreases: A)the demand for compact discs increases. B)the demand for compact discs decreases. C)the supply of compact discs increases. D)the supply of compact discs decreases.

Suppose that a product benefits from a successful advertising campaign.The result is that: A)the demand for the product increases. B)the demand for the product decreases. C)the supply of the product increases. D)the supply of the product decreases.

Suppose that consumers expect that the price of a product will increase in the future.The result is that: A)the current demand for the product increases. B)the current demand for the product decreases. C)the current supply of the product increases. D)the current supply of the product decreases.

Two goods are complements if: A)the supply of one good decreases when the price of the other increases. B)the supply of one good decreases when the price of the other decreases. C)the demand for one good decreases when the price of the other increases. D)the demand for one good decreases when the price of the other decreases.

Suppose you have 2 goods,X and Y.If the price of X increases and you buy more Y,then X and Y are: A)substitutes. B)normal goods. C)complements. D)inferior goods.

Suppose you have 2 goods,X and Y.If the price of X decreases and you buy more Y,then X and Y are: A)substitutes. B)normal goods. C)complements. D)inferior goods.

Suppose that consumption of oat bran is found to reduce cholesterol and improve health.The result is that: A)the demand for oat bran decreases. B)the demand for oat bran increases. C)the supply of oat bran increases. D)Both A and C are correct.

Suppose that consumers expect the price of a product to decrease in the future.The result is that: A)the current demand for the product increases. B)the current demand for the product decreases. C)the current supply of the product increases. D)the current supply of the product decreases.

Figure 4.4 -Figure 4.4 illustrates the demand for guitars.An increase in the demand for guitars is represented by the movement from: A)point B to point C. B)point B to point A. C)D₁ to D₀. D)D₁ to D₂.

Figure 4.4 -Figure 4.4 illustrates the demand for guitars.A decrease in the demand for guitars is represented by the movement from: A)point B to point C. B)point B to point A. C)D₁ to D₀. D)D₁ to D₂.

Figure 4.4 -Figure 4.4 illustrates the demand for guitars.Assume guitars are a normal good.An increase in income would bring about a movement from: A)point B to point C. B)point B to point A. C)D₁ to D₀. D)D₁ to D₂.

Figure 4.4 -Figure 4.4 illustrates the demand for guitars.Assume guitars are an inferior good.An increase in income would bring about a movement from: A)point B to point C. B)point B to point A. C)D₁ to D₀. D)D₁ to D₂.

Figure 4.4 -Figure 4.4 illustrates the demand for guitars.Assume that guitars and guitar strings are complements.An increase in the price of guitar strings would bring about a movement from: A)point B to point C. B)point B to point A. C)D₁ to D₀. D)D₁ to D₂.

Figure 4.4 -Figure 4.4 illustrates the demand for guitars.Assume that guitars and guitar strings are complements.A decrease in the price of guitar strings would bring about a movement from: A)point B to point C. B)point B to point A. C)D₁ to D₀. D)D₁ to D₂.

Figure 4.4 -Figure 4.4 illustrates the demand for guitars.Assume that guitars and banjos are substitutes.A decrease in the price of banjos would bring about a movement from: A)point B to point C. B)point B to point A. C)D₁ to D₀. D)D₁ to D₂.

Figure 4.4 -Figure 4.4 illustrates the demand for guitars.An increase in the number of guitar players in the market would bring about a movement from: A)point B to point C. B)point B to point A. C)D₁ to D₀. D)D₁ to D₂.

Figure 4.4 -Figure 4.4 illustrates the demand for guitars.An increase in price of guitars would bring about a movement from: A)point B to point C. B)point B to point A. C)D₁ to D₀. D)D₁ to D₂.

Figure 4.4 -Figure 4.4 illustrates the demand for guitars.A decrease in price of guitars would bring about a movement from: A)point B to point C. B)point B to point A. C)D₁ to D₀. D)D₁ to D₂.

Figure 4.4 -Figure 4.4 illustrates the demand for guitars.A successful advertising campaign to sell guitars would bring about a movement from: A)point B to point C. B)point B to point A. C)D₁ to D₀. D)D₁ to D₂.

Figure 4.4 -Figure 4.4 illustrates the demand for guitars.If people expect the price of guitars to decrease in the near future,this would most likely bring about a movement from: A)point B to point C. B)point B to point A. C)D₁ to D₀. D)D₁ to D₂.

Assume that tortilla chips and salsa are complements.When the price of tortilla chips decreases: A)the demand for salsa increases. B)the demand for salsa decreases. C)the supply of salsa decreases. D)the demand for tortilla chips decreases.

An inferior good is defined as a good for which demand decreases when: A)the price increases. B)income increases. C)the price decreases. D)income decreases.

When the price of one product decreases,what does it do to the demand of its complementary product? A)It decreases. B)It increases. C)They balance each other. D)none of the above

If the population increases,what will this do for the market demand for most products? A)no change B)decrease C)increase D)none of the above

If the U.S.population increases,then: A)the demand for electricity increases. B)the demand for electricity decreases. C)the quantity demanded for electricity decreases. D)the quantity demanded for electricity increases.

If incomes increase and electricity is a normal good,then: A)the demand for electricity increases. B)the demand for electricity decreases. C)the quantity demanded for electricity decreases. D)the quantity demanded for electricity increases.

If incomes decrease and electricity is a normal good,then: A)the demand for electricity increases. B)the demand for electricity decreases. C)the quantity demanded for electricity decreases. D)the quantity demanded for electricity increases.

If incomes increase and hotdogs are inferior goods,then: A)the demand for hotdogs increases. B)the demand for hotdogs decreases. C)the quantity demanded for hotdogs decreases. D)the quantity demanded for hotdogs increases.

If the price of hotdogs are expected to increase in the future,then: A)the current demand for hotdogs will increase. B)the current demand for hotdogs will decrease. C)the current quantity demanded for hotdogs will decrease. D)the current quantity demanded for hotdogs will increase.

If the price of hotdogs are expected to decrease in the future,then: A)the current demand for hotdogs will increase. B)the current demand for hotdogs will decrease. C)the current quantity demanded for hotdogs will decrease. D)the current quantity demanded for hotdogs will increase.

The purpose of advertising products to consumers is to: A)reduce costs for producers. B)decrease the demand for the product. C)increase the price of the product. D)change consumers' tastes toward the product.

If consumers have an expectation of a product's price increasing in the near future,they will usually: A)wait to see if the price really increases. B)purchase more at the current price. C)wait for the new price and compare. D)none of the above

When a consumer's income decreases,the consumer: A)has less to spend. B)buys a smaller quantity of normal goods. C)buys more of inferior goods. D)all of the above

Decreases in the demand for products can be caused by which of the following? A)decreases in income B)decreases in population C)decreases in the prices of substitute goods D)all of the above

A decrease in demand for coffee can be caused by: A)an increase in demand for substitute products by younger populations. B)a decrease in demand due to changing preferences for healthier products. C)an increase in income and coffee is an inferior good. D)all of the above.

When the price of a product decreases,the demand for a substitute product: A)decreases. B)increases. C)changes to balance the price change. D)none of the above

According to the Application,which determinant of demand is responsible for the increase in the demand for pecans? A)preferences B)income C)price of substitutes D)price of complements

From the Application,which of the following would we observe in the market for pecans as a result of an increase in the demand for pecans? A)higher equilibrium price and equilibrium quantity of pecans. B)higher equilibrium price and equilibrium quantity of pecan pies. C)lower equilibrium price and equilibrium quantity of pecans. D)higher equilibrium price and lower equilibrium quantity of pecans.

Can we infer that pecans are normal and inferior goods,just purely from reading the Application? A)No.The Application made no mention of changes in income. B)No.The Application did not mention the quality of the pecans. C)Yes,pecans are inferior goods. D)Yes,pecans are normal goods.

An increase in demand will cause the equilibrium price and quantity to rise.

Two goods are substitutes if an increase in the price of one good leads to an increase in demand for the other.

People will buy more of a normal good when their income decreases.

Two goods are complements if an increase in the price of one good leads to an increase in demand for the other.

People will buy more of an inferior good when their income decreases.

If the cost of producing a product goes down,this will cause the equilibrium price of the product to go down and the equilibrium quantity of the product to go up.

Complementary goods are goods that are normally consumed together.

An increase or decrease in population will increase or decrease demand.

Use the supply and demand model to explain why it is difficult to find an on-campus parking space during peak mid-day times,although it is much easier to find a parking space during less popular evening hours.

Why do the demand curves for inferior goods slope downward,even though the law of demand is driven in part by the income effect?

What is the difference between a "shift in the demand curve" and a "movement along the demand curve"?

Name at least three variables that can affect the demand for a product and the market equilibrium.

In economics,a change in preferences for the product causes a ________.

When a consumer's income increases,that consumer tends to buy more ________.

Define an "inferior good" as it relates to markets.

When a consumer's income decreases,that consumer tends to buy more ________.

Define a "normal good" as it relates to markets.

What does an increase in population do to the demand for a product?

When consumers find their incomes increasing,they tend to buy more ________.

What does a decrease in population do to the demand for a product?

Hops are used to produce beer.If the price of hops decreases: A)the demand for beer increases. B)the demand for beer decreases. C)the supply of beer increases. D)the supply of beer decreases.

If the number of beer producers decreases: A)the demand for beer increases. B)the demand for beer decreases. C)the supply of beer increases. D)the supply of beer decreases.

The price of oranges has risen dramatically.Which of the following is likely to happen? A)The quantity of oranges supplied will increase. B)The quantity of oranges supplied will decrease. C)The supply of oranges will decrease. D)The supply of oranges will increase.

The price of compact discs has fallen dramatically.Which of the following is likely to happen? A)The quantity supplied of compact discs will decrease. B)The quantity supplied of compact discs will increase. C)The supply of compact discs will decrease. D)The supply of compact discs players will increase.

Flour is used to produce bread.If the price of flour increases: A)the demand for bread increases. B)the demand for bread decreases. C)the supply of bread increases. D)the supply of bread decreases.

If a technological advance makes it possible to produce bananas at a lower cost: A)the demand for bananas increases. B)the demand for bananas decreases. C)the supply of bananas increases. D)the supply of bananas decreases.

Which of the following can increase the number of pizzas a seller is willing to sell at a given price? A)The cost of inputs such as pepperoni and cheese goes up. B)The number of workers working in the pizza factory decreases. C)The amount of subsidies that pizza makers receive from the government decreases. D)A new technology is developed that allows producers to make the same sized pizza using less cheese and dough.

If the price of crude oil (an input to the production of gasoline)increases,then we will expect to see: A)a movement along the supply curve for gasoline upwards. B)a movement along the supply curve for gasoline downwards. C)a shift in the supply of gasoline to the left. D)a shift in the supply of gasoline to the right.

If the price of crude oil (an input to the production of gasoline)decreases,then we will expect to see: A)a movement along the supply curve for gasoline upwards. B)a movement along the supply curve for gasoline downwards. C)a shift in the supply of gasoline to the left. D)a shift in the supply of gasoline to the right.

A decrease in the tuition (i.e. ,price)that a public university charges would result in: A)an upward movement along the supply curve for college classes. B)an downward movement along the supply curve for college classes. C)a shift in the supply of college classes to the left. D)a shift in the supply of college classes to the right.

An increase in the amount of subsidies that a public university receives would result in: A)an upward movement along the supply curve for college classes. B)an downward movement along the supply curve for college classes. C)a shift in the supply of college classes to the left. D)a shift in the supply of college classes to the right.

A decrease in the amount of subsidies that a public university receives would result in: A)an upward movement along the supply curve for college classes. B)an downward movement along the supply curve for college classes. C)a shift in the supply of college classes to the left. D)a shift in the supply of college classes to the right.

If the number of banana producers increases: A)the demand for bananas increases. B)the demand for bananas decreases. C)the supply of bananas increases. D)the supply of bananas decreases.

Figure 4.5 -Figure 4.5 illustrates the supply of guitars.An increase in the supply of guitars is represented by a movement from: A)point B to point C. B)point B to point A. C)S₁ to S₀. D)S₁ to S₂.

Figure 4.5 -Figure 4.5 illustrates the supply of guitars.A decrease in the supply of guitars is represented by a movement from: A)point B to point C. B)point B to point A. C)S₁ to S₀. D)S₁ to S₂.

Figure 4.5 -Figure 4.5 illustrates the supply of guitars.An increase in the price of rosewood,which is used to make guitars,would most likely cause a movement from: A)point B to point C. B)point B to point A. C)S₁ to S₀. D)S₁ to S₂.

Figure 4.5 -Figure 4.5 illustrates the supply of guitars.A technological advancement that makes guitars cheaper to produce would most likely cause a movement from: A)point B to point C. B)point B to point A. C)S₁ to S₀. D)S₁ to S₂.

Figure 4.5 -Figure 4.5 illustrates the supply of guitars.An increase in the number of guitar manufacturers would most likely cause a movement from: A)point B to point C. B)point B to point A. C)S₁ to S₀. D)S₁ to S₂.

Figure 4.5 -Figure 4.5 illustrates the supply of guitars.If the government offered a subsidy to guitar manufacturers for each guitar they produce,this would most likely cause a movement from: A)point B to point C. B)point B to point A. C)S₁ to S₀. D)S₁ to S₂.

Figure 4.5 -Figure 4.5 illustrates the supply of guitars.If firms expect the price of guitars to go up after Christmas,then before Christmas this would most likely cause a movement from: A)point B to point C. B)point B to point A. C)S₁ to S₀. D)S₁ to S₂.

An increase in supply of a product results when: A)more companies produce the product. B)the companies that produce the product have reduced input costs. C)technological innovations are introduced in the manufacturing. D)all of the above

If there is an advance in the technology used to produce a product,what is the likely effect it may have on the supply? A)The company would not change its manufacturing. B)More people would be needed to produce the product. C)It would decrease the supply. D)It would increase the supply.

Suppose that the government requires that farms use only animals instead of machinery when planting and harvesting corn.This will result in a(n): A)decrease in the supply of corn. B)decrease in the quantity supplied of corn. C)increase in the supply of corn. D)increase in the quantity supplied of corn.

If sellers have an expectation of higher future prices: A)the current supply of that good will decrease. B)the current demand for that good will increase. C)the current supply of that good will increase. D)the current demand for that good will decrease.

If sellers have an expectation of lower future prices: A)the current supply of that good will decrease. B)the current demand for that good will increase. C)the current supply of that good will increase. D)the current demand for that good will decrease.

Bananas and apples are substitutes.When the price of bananas falls and a technological advancement in apple production occurs at the same time: A)the equilibrium price of apples rises and the equilibrium quantity of apples falls. B)the equilibrium price of apples rises and the equilibrium quantity of apples rises. C)the equilibrium price of apples rises and the equilibrium quantity of apples might rise or fall. D)the equilibrium price of apples falls and the equilibrium quantity of apples might rise or fall.

Bananas and apples are substitutes.When the price of bananas rises and a technological advance in apple production occurs at the same time: A)the equilibrium price of apples rises and the equilibrium quantity of apples falls. B)the equilibrium price of apples rises and the equilibrium quantity of apples rises. C)the equilibrium price of apples rises and the equilibrium quantity of apples might rise or fall. D)the equilibrium quantity of apples rises and the equilibrium price of apples might rise or fall.

Peaches and cream are complements.When the price of peaches falls and the price of raw milk (used to make cream)rises: A)the equilibrium price of cream rises and the equilibrium quantity of cream might rise or fall. B)the equilibrium price of cream falls and the equilibrium quantity of cream might rise or fall. C)the equilibrium price of cream falls and the equilibrium quantity of cream falls. D)the equilibrium price of cream falls and the equilibrium quantity of cream rises.

Peaches and cream are complements.When the price of peaches rises and the price of raw milk (used to make cream)rises: A)the equilibrium price of cream rises and the equilibrium quantity of cream might rise or fall. B)the equilibrium price of cream falls and the equilibrium quantity of cream might rise or fall. C)the equilibrium price of cream falls and the equilibrium quantity of cream rises. D)the equilibrium quantity of cream falls and the equilibrium price of cream might rise or fall.

Suppose that a new advertising campaign extolling the virtues of apple juice is successful and a major freeze destroys half of the country's apple crop.What happens to the price and quantity of apple juice? A)The equilibrium price of apple juice might rise or fall and the equilibrium quantity of apple juice falls. B)The equilibrium price of apple juice might rise or fall and the equilibrium quantity of apple juice rises. C)The equilibrium price of apple juice rises and the equilibrium quantity of apple juice might rise or fall. D)The equilibrium price of apple juice falls and the equilibrium quantity of apple juice might rise or fall.

Suppose that a new study is released stating that consumption of orange juice (a substitute for apple juice)reduces the risk of cancer and a major freeze destroys half of the country's apple crop.What happens to the price and quantity of apple juice? A)The price of apple juice might rise or fall and the quantity of apple juice falls. B)The price of apple juice might rise or fall and the quantity of apple juice rises. C)The price of apple juice falls and the quantity of apple juice falls. D)The quantity of apple juice might rise or fall and the price of apple juice rises.

Figure 4.7 -If demand increases in Figure 4.7,then the equilibrium: A)price and quantity rise. B)price rises and quantity falls. C)price falls and quantity rises. D)price and quantity fall.

Figure 4.7 -If demand falls in Figure 4.7,then the equilibrium: A)price and quantity rise. B)price rises and quantity falls. C)price falls and quantity rises. D)price and quantity fall.

Figure 4.7 -If supply increases in Figure 4.7,then the equilibrium: A)price and quantity rise. B)price rises and quantity falls. C)price falls and quantity rises. D)price and quantity fall.

Figure 4.7 -If supply decreases in Figure 4.7,then the equilibrium: A)price and quantity rise. B)price rises and quantity falls. C)price falls and quantity rises. D)price and quantity fall.

Figure 4.7 -If demand and supply rise in Figure 4.7,then the equilibrium: A)price rises. B)price falls. C)quantity rises. D)quantity falls.

Figure 4.7 -If demand and supply decrease in Figure 4.7,then the equilibrium: A)price rises. B)price falls. C)quantity rises. D)quantity falls.

Figure 4.7 -If demand decreases and supply increases in Figure 4.7,then the equilibrium: A)price rises. B)price falls. C)quantity rises. D)quantity falls.

Figure 4.7 -If demand increases and supply decreases in Figure 4.7,then the equilibrium: A)price rises. B)price falls. C)quantity rises. D)quantity falls.

According to the application,the increase in the price of ice cream is caused by: A)a decrease in the output of fruit trees caused by the decline in the number of honey bees that pollinate these fruit trees. B)an increase in the output of fruit trees caused by the decline in the number of honey bees that pollinate these fruit trees. C)a decrease in the output of fruit trees caused by the rise in the number of honey bees that pollinate these fruit trees. D)an increase in the output of fruit trees caused by the rise in the number of honey bees that pollinate these fruit trees.

Using supply and demand analysis,the increase in the price of ice cream can be illustrated as: A)a leftward shift in the supply curve for ice cream caused by more expensive ingredients. B)a rightward shift in the supply curve for ice cream caused by more expensive ingredients. C)a leftward shift in the demand curve for ice cream caused by more expensive ingredients. D)a rightward shift in the demand curve for ice cream caused by more expensive ingredients.

Using supply and demand analysis,if the "colony collapse disorder (CCD)" of honey bees caused a leftward shift of the supply curve for ice cream,then which of the following must be true? A)The equilibrium price of ice cream increased and the equilibrium quantity decreased. B)The equilibrium price of ice cream decreased and the equilibrium quantity decreased. C)The equilibrium price of ice cream increased and the equilibrium quantity increased. D)The equilibrium price of ice cream decreased and the equilibrium quantity increased.

If the cost of producing a product goes down,this will cause the equilibrium price of the product to go down and the equilibrium quantity of the product to go up.

A decrease in supply will cause the equilibrium price and quantity of a good to fall.

A major freeze in Florida has reduced the orange yield this winter.What will be the effect of this freeze on the price and quantity in the orange market and also in the peach market? (Assume that oranges and peaches are substitutes. )

Suppose that the price of oranges increases and the quantity of oranges in the market decreases.Suggest two reasons why this might have happened.

What is the difference between a "shift in the supply curve" and a "movement along the supply curve"?

What is the difference between "an increase in supply" and "an increase in quantity supplied" of a good?

Using a graph,illustrate the effect that an increase in production costs will have on the equilibrium price and quantity of a good.

A decrease in the cost of labor or some other input will make the production of a product less costly and more profitable at a given price,so producers will supply more of it.This is an example of ________.

When a government pays a company for producing a product or good with the result that selling the product is more profitable regardless of the price so that the company will produce more of it,it is called a ________.

If a government imposes a tax on a product produced by a company,the tax will ________.

If a government imposes a tax on the producers of a product,in addition to making the product more costly and less profitable,the tax will ________.

The market equilibrium price and quantity can be affected if: A)supply and demand both increase. B)supply and demand both decrease. C)supply increases and demand decreases. D)all of the above

Figure 4.6 -Figure 4.6 illustrates a set of supply and demand curves for a product.When the market moves from point A to point B,there has been: A)an increase in supply and an increase in demand. B)an increase in supply and an increase in quantity demanded. C)an increase in quantity supplied and an increase in demand. D)an increase in quantity supplied and an increase in quantity demanded.

Figure 4.6 -Figure 4.6 illustrates a set of supply and demand curves for a product.When the economy moves from point B to point A,there has been: A)an increase in supply and an increase in demand. B)an decrease in supply and an decrease in quantity demanded. C)an increase in quantity supplied and an increase in demand. D)an increase in quantity supplied and an increase in quantity demanded.

Figure 4.6 -Figure 4.6 illustrates a set of supply and demand curves for a product.When the economy moves from point B to point C,there has been: A)a decrease in supply and a decrease in demand. B)a decrease in supply and a decrease in quantity demanded. C)a decrease in quantity supplied and a decrease in demand. D)a decrease in quantity supplied and a decrease in quantity demanded.

Figure 4.6 -Figure 4.6 illustrates a set of supply and demand curves for a product.When the economy moves from point C to point E,there has been: A)an increase in supply and a decrease in quantity demanded. B)a decrease in supply and a decrease in quantity demanded. C)a decrease in quantity supplied and a decrease in demand. D)an increase in quantity supplied and a decrease in quantity demanded.

Figure 4.6 -Figure 4.6 illustrates a set of supply and demand curves for a product.When the economy moves from point E to point A,there has been: A)an increase in supply and an increase in demand. B)an increase in supply and an increase in quantity demanded. C)an increase in quantity supplied and an increase in demand. D)an increase in quantity supplied and an increase in quantity demanded.

Figure 4.6 -Figure 4.6 illustrates a set of supply and demand curves for a product.Suppose that the market is currently in point A.If the price of the input of the product decreases,the market will move to point: A)A. B)B. C)C. D)D.

Figure 4.6 -Figure 4.6 illustrates a set of supply and demand curves for a product.If the good were inferior and the consumer's income decreases,then this can be illustrated as moving from point: A)A to B. B)C to B. C)E to B. D)B to A.

Bananas and apples are substitutes.When the price of bananas falls,the equilibrium quantity of apples will ________ and the equilibrium price of apples will ________. A)rise;rise B)rise;fall C)fall;rise D)fall;fall

Bananas and apples are substitutes.When the price of bananas rises,the equilibrium quantity of apples will ________ and the equilibrium price of apples will ________. A)increase;increase B)increase;decrease C)decrease;increase D)decrease;decrease

Peaches and cream are complements.When the price of peaches falls,the equilibrium quantity of cream will ________ and the equilibrium price of cream will ________. A)rise;rise B)rise;fall C)fall;rise D)fall;fall

Peaches and cream are complements.When the price of peaches rises,the equilibrium quantity of cream will ________ and the equilibrium price of cream will ________. A)increase;increase B)increase;decrease C)decrease;increase D)decrease;decrease

Suppose that ramen noodles are an inferior good.When income increases,the equilibrium quantity of ramen noodles will ________ and the equilibrium price of ramen noodles will ________. A)rise;rise B)rise;fall C)fall;rise D)fall;fall

Suppose that ramen noodles are an inferior good.When income decreases,the equilibrium quantity of ramen noodles will ________ and the equilibrium price of ramen noodles will ________. A)increase;increase B)increase;decrease C)decrease;increase D)decrease;decrease

Suppose that steak is a normal good.When income increases,the equilibrium quantity of steak will ________ and the equilibrium price of steak will ________. A)rise;rise B)rise;fall C)fall;rise D)fall;fall

Suppose that steak is a normal good.When income decreases,the equilibrium quantity of steak will ________ and the equilibrium price of steak will ________. A)increase;increase B)increase;decrease C)decrease;increase D)decrease;decrease

Suppose that the population of a country increases.Assuming that people in that country enjoy eating steak,we would predict that the equilibrium quantity of steak will ________ and the equilibrium price of steak will ________ in that country. A)rise;rise B)rise;fall C)fall;rise D)fall;fall

Suppose that the population of a country decreases.Assuming that people in that country enjoy eating steak,we would predict that the equilibrium quantity of steak will ________ and the equilibrium price of steak will ________ in that country. A)increase;increase B)increase;decrease C)decrease;increase D)decrease;decrease

Suppose that the Surgeon General releases a study suggesting that orange juice consumption reduces the risk of cancer.We would predict that the equilibrium quantity of orange juice will ________ and the equilibrium price of orange juice will ________. A)rise;rise B)rise;fall C)fall;rise D)fall;fall

Suppose that the Surgeon General releases a study suggesting that orange juice consumption reduces the risk of cancer.As a result of the study,we could predict that the demand curve for orange juice will ________ and the equilibrium price will ________. A)increase;increase B)increase;decrease C)decrease;decrease D)decrease;increase

Suppose that the Surgeon General releases a study suggesting that orange juice consumption increases the risk for diabetes.As a result of the study,we could predict that the demand curve for orange juice will ________ and the equilibrium price will ________. A)increase;increase B)increase;decrease C)decrease;decrease D)decrease;increase

Suppose that the Surgeon General releases a study suggesting that steak consumption increases the risk of cancer.As a result of this study,we would predict that the equilibrium quantity of steak will ________ and the equilibrium price of steak will ________. A)increase;increase B)increase;decrease C)decrease;increase D)decrease;decrease

Suppose that people expect that the price of orange juice will fall next month.We would predict that the equilibrium quantity of orange juice will ________ and the equilibrium price of orange juice will ________ this month. A)rise;rise B)rise;fall C)fall;rise D)fall;fall

Suppose that people expect that the price of orange juice will rise next month.We would predict that the equilibrium quantity of orange juice will ________ and the equilibrium price of orange juice will ________ this month. A)increase;increase B)decrease;increase C)increase;decrease D)decrease;decrease

Suppose that the price of fertilizer,an input in the production of corn,falls.We would predict that the equilibrium quantity of corn will ________ and the equilibrium price of corn will ________. A)rise;rise B)rise;fall C)fall;rise D)fall;fall

Suppose that the price of fertilizer,an input in the production of corn,rises.We would predict that the equilibrium quantity of corn will ________ and the equilibrium price of corn will ________. A)increase;increase B)increase;decrease C)decrease;increase D)decrease;decrease

Suppose that a technological advancement substantially reduces the cost of producing cheese.We would predict that the equilibrium quantity of cheese will ________ and the equilibrium price of cheese will ________. A)rise;rise B)rise;fall C)fall;rise D)fall;fall

Suppose that a natural disaster substantially increases the cost of producing cheese.We would predict that the equilibrium quantity of cheese will ________ and the equilibrium price of cheese will ________. A)increase;increase B)increase;decrease C)decrease;increase D)decrease;decrease

Suppose that in October the price of a cup of cafe latte was $1.50 and 400 lattes were consumed.In November the price of a latte was $2.00 and 600 lattes were consumed.What might have caused this change? A)The price of tea (a substitute for cafe lattes)fell. B)The price of tea (a substitute for cafe lattes)rose. C)The price of coffee beans (an input of production of cafe lattes)rose. D)The price of coffee beans (an input of production of cafe lattes)fell.

Suppose that in October the price of a cup of cafe latte was $1.50 and 400 lattes were consumed.In November the price of a latte was $2.00 and 200 lattes were consumed.What might have caused this change? A)The price of tea (a substitute for cafe lattes)fell. B)The price of tea (a substitute for cafe lattes)rose. C)The price of coffee beans (an input of production of cafe lattes)rose. D)The price of coffee beans (an input of production of cafe lattes)fell.

Suppose that in 2006,8 million cars were purchased at $15,000 each,while in 2007,10 million cars were purchased at $12,000 each.What might have caused this change? A)The price of airplane tickets (a substitute for cars)fell. B)The price of airplane tickets (a substitute for cars)rose. C)There was an advance in automobile manufacturing technology. D)There were fewer workers in automobile manufacturing.

Suppose that in 2006,12 million cars were purchased at $15,000 each,while in 2007,10 million cars were purchased at $12,000 each.What might have caused this change? A)The price of airplane tickets (a substitute for cars)fell. B)The price of airplane tickets (a substitute for cars)rose. C)Automobile manufacturing technology increased. D)Automobile manufacturing technology decreased.

If the equilibrium price of a good increases and the equilibrium quantity of the good decreases,we can conclude that: A)demand increased. B)demand decreased. C)supply increased. D)supply decreased.

If the equilibrium price of a good decreases and the equilibrium quantity of the good decreases,we can conclude that: A)demand increased. B)demand decreased. C)supply increased. D)supply decreased.

Lettuce and spinach are substitute goods.All else equal,if a spinach beetle destroys half of the nation's spinach crop,we predict that the equilibrium price of lettuce will ________ and the equilibrium price of spinach will ________. A)rise;rise B)rise;fall C)fall;rise D)fall;fall

Lettuce and spinach are substitute goods.All else equal,if a spinach beetle destroys half of the nation's spinach crop,we predict that the equilibrium price of lettuce will ________ and the equilibrium quantity of spinach will ________. A)rise;rise B)rise;fall C)fall;rise D)fall;fall

In the Application,what did Ted Koppel identify as the explanation for why (illegal)drug prices have been dropping? A)an increase in the supply B)an increase in demand C)a decrease in supply D)a decrease in demand

In the Application,what did the Justice Department identify as the explanation for why (illegal)drug prices have been dropping? A)an increase in the supply B)an increase in demand C)a decrease in supply D)a decrease in demand

In the Application,what should we observe before we can undoubtedly attribute the lower drug prices to an increase in supply? A)an increase in the equilibrium quantity B)a shortage C)a decrease in the equilibrium quantity D)a surplus