Question 1

Figure 4-24 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-24. All else equal, a sale on chicken would cause a move from A)D_A to D_B. B)D_B to D_A. C)x to y. D)y to x.

Accepted Answer

The answer of Figure 4-24
The diagram below pertains to the...

Question 2

Figure 4-24 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-24. All else equal, the premature deaths of thousands of turkeys would cause a move from A)D_A to D_B. B)D_B to D_A. C)x to y. D)y to x.

Accepted Answer

The answer of Figure 4-24
The diagram below pertains to the...

Question 3

Figure 4-24 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-24. All else equal, a large number of people becoming vegetarians would cause a move from A)D_A to D_B. B)D_B to D_A. C)x to y. D)y to x.

Accepted Answer

The answer of Figure 4-24
The diagram below pertains to the...

Question 4

Figure 4-24 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-24. All else equal, an increase in the productivity of turkey farmers would cause a move from A)D_A to D_B. B)D_B to D_A. C)x to y. D)y to x.

Accepted Answer

The answer of Figure 4-24
The diagram below pertains to the...

Question 5

Figure 4-23 
-Refer to Figure 4-23. In this market for watermelons, a severe drought occurs which affects the watermelon crop. The equilibrium price
A)increases and the equilibrium quantity decreases.
B)decreases and the equilibrium quantity is ambiguous.
C)and quantity both increase.
D)and quantity both decrease.

Accepted Answer

A severe drought will decrease the supply of watermelons as there will be less water available to grow them. This will cause the supply curve to shift leftward, leading to a higher equilibrium price and a lower equilibrium quantity.

Question 6

What would happen to the equilibrium price and quantity of lattés if coffee shops began using a machine that reduced the amount of labor necessary to produce steamed milk, which is used to make lattés, and scientists discovered that lattés cause heart attacks?
A)Both the equilibrium price and quantity would increase.
B)Both the equilibrium price and quantity would decrease.
C)The equilibrium price would decrease, and the effect on equilibrium quantity would be ambiguous.
D)The equilibrium quantity would decrease, and the effect on equilibrium price would be ambiguous.

Accepted Answer

The reduced labor required to produce steamed milk would shift the supply curve to the right, causing a decrease in equilibrium price and an increase in equilibrium quantity. However, the discovery that lattés cause heart attacks would decrease the demand for lattés, causing a leftward shift of the demand curve, which would decrease the equilibrium quantity. The effect on equilibrium price would be ambiguous because the decrease in demand would decrease price, while the decrease in supply would increase price. Ultimately, the equilibrium quantity would decrease, but the effect on equilibrium price would be unclear.

Question 7

Figure 4-24 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-24. All else equal, an increase in the income of buyers who consider turkey to be an inferior good would cause a move from A)D_A to D_B. B)D_B to D_A. C)x to y. D)y to x.

Accepted Answer

The answer of Figure 4-24
The diagram below pertains to the...

Question 8

Figure 4-24 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-24. All else equal, the approach of Thanksgiving would cause a move from A)D_A to D_B. B)D_B to D_A. C)x to y. D)y to x.

Accepted Answer

As the approach of Thanksgiving would increase the demand for turkey, causing the demand curve to shift to the right from D_A to D_B, all else being equal.

Question 9

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

Accepted Answer

The answer of Consider the market for portable air conditioners...

Question 10

New cars are normal goods. What will happen to the equilibrium price of new cars if the price of gasoline rises, the price of steel falls, public transportation becomes cheaper and more comfortable, auto-workers accept lower wages, and automobile insurance becomes more expensive?
A)Price will rise.
B)Price will fall.
C)Price will stay exactly the same.
D)The price change will be ambiguous.

Accepted Answer

The answer of New cars are normal goods. What will...

Question 11

What will happen to the equilibrium price and quantity of traditional camera film if traditional cameras become more expensive, digital cameras become cheaper, the cost of the resources needed to manufacture traditional film falls, and more firms decide to manufacture traditional film?
A)Price will fall, and the effect on quantity is ambiguous.
B)Price will rise, and the effect on quantity is ambiguous.
C)Quantity will fall, and the effect on price is ambiguous.
D)Quantity will rise, and the effect on price is ambiguous.

Accepted Answer

If traditional cameras become more expensive and digital cameras become cheaper, the demand for traditional camera film will decrease, which will result in a decrease in price. The decrease in the cost of resources needed to manufacture traditional film and an increase in the number of manufacturers will increase the supply of traditional film, which will also result in a decrease in price. The effect on quantity is ambiguous because the decrease in demand will decrease quantity while the increase in supply will increase quantity. Therefore, it is unclear which effect will prevail.

Question 12

What will happen to the equilibrium price and quantity of new cars if the price of gasoline rises, the price of steel rises, public transportation becomes cheaper and more comfortable, and auto-workers negotiate higher wages?
A)Price will fall, and the effect on quantity is ambiguous.
B)Price will rise, and the effect on quantity is ambiguous.
C)Quantity will fall, and the effect on price is ambiguous.
D)Quantity will rise, and the effect on price is ambiguous.

Accepted Answer

If the price of gasoline and steel rise, the cost of producing cars will increase, leading to a decrease in supply. This will result in a higher equilibrium price and a lower quantity of new cars sold. Additionally, if public transportation becomes cheaper and more comfortable, consumers may switch away from purchasing cars altogether, further decreasing the demand for new cars. Finally, if auto-workers negotiate higher wages, this will increase the cost of labor for producers, leading to a decrease in supply and a higher equilibrium price. Overall, the combined effect of these factors is likely to be a decrease in the equilibrium quantity and an ambiguous effect on the equilibrium price.

Question 13

What would happen to the equilibrium price and quantity of lattés if the cost to produce steamed milk, which is used to make lattés, increased, and scientists discovered that lattés cause heart attacks?
A)Both the equilibrium price and quantity would increase.
B)Both the equilibrium price and quantity would decrease.
C)The equilibrium price would decrease, and the effect on equilibrium quantity would be ambiguous.
D)The equilibrium quantity would decrease, and the effect on equilibrium price would be ambiguous.

Accepted Answer

The answer of What would happen to the equilibrium price...

Question 14

What would happen to the equilibrium price and quantity of lattés if coffee shops began using a machine that reduced the amount of labor necessary to produce steamed milk, which is used to make lattés, and scientists discovered that coffee prevents heart attacks?
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 effect on equilibrium quantity would be ambiguous.
D)The equilibrium quantity would increase, and the effect on equilibrium price would be ambiguous.

Accepted Answer

The decrease in the amount of labor necessary to produce steamed milk would decrease the cost of production for lattés, causing an increase in the supply of lattés. This increase in supply would cause the equilibrium quantity to increase, but the effect on the equilibrium price would be ambiguous, as it depends on the magnitude of the decrease in production cost. The discovery that coffee prevents heart attacks would increase demand for coffee, including lattés, leading to an increase in both the equilibrium price and quantity. However, since the question only asked about the effects of the machine that reduces labor and the discovery about coffee, the correct answer is D.

Question 15

Figure 4-24 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-24. All else equal, buyers expecting turkey to be more expensive in the future would cause a current move from A)D_A to D_B. B)D_B to D_A. C)x to y. D)y to x.

Accepted Answer

When buyers expect turkey to be more expensive in the future, they will increase their current demand for turkey in order to avoid higher prices later. This will shift the demand curve to the right, from D_B to D_A, causing an increase in both quantity demanded and price.

Question 16

Consider the market for new DVDs. If DVD players became cheaper, buyers expected DVD prices to fall next year, used DVDs became more expensive, and DVD production technology improved, then the equilibrium price of a new DVD would
A)rise.
B)fall.
C)stay the same.
D)could rise, fall, or remain unchanged.

Accepted Answer

The answer of Consider the market for new DVDs. If...

Question 17

Figure 4-23 
-Refer to Figure 4-23. In this market for sunscreen, there is a decrease in the price of zinc oxide, an input into sunscreen, and more producers enter the market. The equilibrium price
A)increases and the equilibrium quantity decreases.
B)decreases and the equilibrium quantity increases.
C)is ambiguous and the equilibrium quantity increases.
D)decreases and the equilibrium quantity is ambiguous.

Accepted Answer

A decrease in the price of zinc oxide, an input into sunscreen production, will decrease the cost of production for sunscreen producers. This will shift the supply curve to the right, leading to a decrease in the equilibrium price and an increase in the equilibrium quantity. Additionally, more producers entering the market will increase the overall supply, further decreasing the equilibrium price and increasing the equilibrium quantity. Therefore, the best choice is B, which states that the equilibrium price decreases and the equilibrium quantity increases.

Question 18

Which of the following sets of events must cause an increase in the price of a new house?
A)higher wages for carpenters, higher wood prices, increases in consumer incomes, higher apartment rents, increases in population, and expectations of higher house prices in the future
B)lower wages for carpenters, lower wood prices, increases in consumer incomes, higher apartment rents, increases in population and expectations of higher house prices in the future
C)lower wages for carpenters, higher wood prices, decreases in consumer incomes, higher apartment rents, decreases in population and expectations of higher house prices in the future
D)higher wages for carpenters, lower wood prices, decreases in consumer incomes, lower apartment rents, decreases in population and expectations of lower house prices in the future

Accepted Answer

Higher wages for carpenters means that the cost of building a new house will increase, leading to higher house prices. Higher wood prices will also increase the cost of building a new house, contributing to higher house prices. Increases in consumer incomes mean that more people will be able to afford to buy a new house, increasing demand and driving up prices. Higher apartment rents can also lead to increases in demand for new houses as people look to buy instead of rent, further driving up prices. Increases in population mean that there are more potential buyers, increasing demand and driving up prices. Expectations of higher house prices in the future can lead to buyers being willing to pay more now in order to make a profit later, contributing to higher house prices.

Question 19

Consider the market for portable air conditioners in equilibrium. When a heat wave strikes the equilibrium price
A)and quantity both decrease.
B)and quantity both increase.
C)increases, and the equilibrium quantity decreases.
D)decreases, and the equilibrium quantity increases.

Accepted Answer

The answer of Consider the market for portable air conditioners...

Question 20

Pens are normal goods. What will happen to the equilibrium price of pens if the price of pencils rises, consumers experience an increase in income, writing in ink becomes fashionable, people expect the price of pens to rise in the near future, the population increases, fewer firms manufacture pens, and the wages of pen-makers increase?
A)Price will rise.
B)Price will fall.
C)Price will stay exactly the same.
D)The price change will be ambiguous.

Accepted Answer

If the price of pencils rises, consumers may switch to pens, increasing demand for pens and driving up the price. 
If consumers experience an increase in income, demand for pens may increase, driving up the price. 
If writing in ink becomes fashionable or people expect the price of pens to rise in the near future, demand for pens may increase, driving up the price. 
If the population increases, demand for pens may increase, driving up the price. 
If fewer firms manufacture pens, supply may decrease, driving up the price. 
If the wages of pen-makers increase, supply may decrease, driving up the price. 
Since all of these factors would increase either demand or decrease supply, the equilibrium price of pens would likely rise.

Quiz 4: The Market Forces of Supply and Demand

Figure 4-24 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-24. All else equal, a sale on chicken would cause a move from

Figure 4-24 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-24. All else equal, the premature deaths of thousands of turkeys would cause a move from

Figure 4-24 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-24. All else equal, a large number of people becoming vegetarians would cause a move from

Figure 4-24 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-24. All else equal, an increase in the productivity of turkey farmers would cause a move from

Figure 4-23 -Refer to Figure 4-23. In this market for watermelons, a severe drought occurs which affects the watermelon crop. The equilibrium price

What would happen to the equilibrium price and quantity of lattés if coffee shops began using a machine that reduced the amount of labor necessary to produce steamed milk, which is used to make lattés, and scientists discovered that lattés cause heart attacks?

Figure 4-24 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-24. All else equal, an increase in the income of buyers who consider turkey to be an inferior good would cause a move from

Figure 4-24 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-24. All else equal, the approach of Thanksgiving would cause a move from

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

New cars are normal goods. What will happen to the equilibrium price of new cars if the price of gasoline rises, the price of steel falls, public transportation becomes cheaper and more comfortable, auto-workers accept lower wages, and automobile insurance becomes more expensive?

What will happen to the equilibrium price and quantity of traditional camera film if traditional cameras become more expensive, digital cameras become cheaper, the cost of the resources needed to manufacture traditional film falls, and more firms decide to manufacture traditional film?

What will happen to the equilibrium price and quantity of new cars if the price of gasoline rises, the price of steel rises, public transportation becomes cheaper and more comfortable, and auto-workers negotiate higher wages?

What would happen to the equilibrium price and quantity of lattés if the cost to produce steamed milk, which is used to make lattés, increased, and scientists discovered that lattés cause heart attacks?

What would happen to the equilibrium price and quantity of lattés if coffee shops began using a machine that reduced the amount of labor necessary to produce steamed milk, which is used to make lattés, and scientists discovered that coffee prevents heart attacks?

Figure 4-24 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-24. All else equal, buyers expecting turkey to be more expensive in the future would cause a current move from

Consider the market for new DVDs. If DVD players became cheaper, buyers expected DVD prices to fall next year, used DVDs became more expensive, and DVD production technology improved, then the equilibrium price of a new DVD would

Figure 4-23 -Refer to Figure 4-23. In this market for sunscreen, there is a decrease in the price of zinc oxide, an input into sunscreen, and more producers enter the market. The equilibrium price

Which of the following sets of events must cause an increase in the price of a new house?

Consider the market for portable air conditioners in equilibrium. When a heat wave strikes the equilibrium price