Quiz 3: Demand and Supply

A relative price is the A) slope of the demand curve. B) difference between one money price and another. C) slope of the supply curve. D) ratio of one money price to another.

A relative price is A) the number of dollars that must be given up in exchange for the good. B) also called the money price. C) not an opportunity cost. D) the ratio of one price to another price.

The opportunity cost of good A in terms of good B is equal to the A) money price of good A minus the money price of good B. B) money price of good B minus the money price of good A. C) ratio of the money price of good A to the money price of good B. D) ratio of the money price of good B to the money price of good A.

The relative price of a good is A) an opportunity cost. B) equal to the money price of a good. C) equal to the price of that good divided by the quantity demanded of the good. D) what you get paid for babysitting your cousin.

The opportunity cost of a hot dog in terms of hamburgers is the A) ratio of the slope of the demand curve for hot dogs to the slope of the demand curve for hamburgers. B) ratio of the slope of the supply curve for hot dogs to the slope of the supply curve for hamburgers. C) money price of a hot dog minus the money price of a hamburger. D) ratio of the money price of a hot dog to the money price of a hamburger.

Joe pays $8,000.00 in tuition. The 8,000 dollar tuition Joe pays is an example of what economists call A) a relative price. B) a money price. C) an indexed price. D) an opportunity price.

If the price of a candy bar is $1 and the price of a fast food meal is $5, then the A) relative price of a candy bar is 5 fast food meals per candy bar. B) money price of a candy bar is 1/5 of a fast food meal per candy bar. C) relative price of a fast food meal is 5 candy bars per fast food meal. D) money price of a fast food meal is 1/5 of a candy bar per fast food meal.

If the price of a hot dog is $2 and the price of a hamburger is $4, then the A) relative price of a hot dog is 1/2 of a hamburger per hot dog. B) money price of a hot dog is 2 hamburgers per hot dog. C) relative price of a hamburger is 1/2 of a hot dog per hamburger. D) money price of a hamburger is 2 hot dogs per hamburger.

Suppose the price of a football is $20.00 and the price of a basketball is $10.00. The ________ of a football is ________. A) relative price; 2 basketballs per football B) relative price; 1/2 basketball per football C) opportunity cost; $20.00 D) opportunity cost; $10.00

The price of a bag of corn chips is $3, and the price of a bottle of soda is $1. What is the relative price of a bag of corn chips? A) 3 bottles of soda per bag of corn chips B) 1/3 bottle of soda per bag of corn chips C) $3 D) 33¢

The price of a bag of corn chips is $3, and the price of a bottle of soda is $1. What is the relative price of a bottle of soda? A) 3 bags of corn chips per bottle of soda B) 1/3 bag of corn chips per bottle of soda C) $3 D) 33¢

An ice cream cone costs $1.50. A can of soda costs $0.75. The relative price of an ice cream cone is A) 1/2 can of soda per ice cream cone, the opportunity cost of an ice cream cone. B) $1.50, the opportunity cost of a can of soda. C) 2 cans of soda per soda, the opportunity cost of an ice cream cone. D) $0.75, the opportunity cost of a can of soda.

Twenty years ago a stove cost $300 and a refrigerator cost $1,500. Today a stove costs $600, while a refrigerator costs $1,800. Which of the following statements is TRUE? A) The relative price of stoves and refrigerators has not changed. B) The relative price of a refrigerator has increased. C) The relative price of a stove has increased. D) The money price of a refrigerator has fallen.

If the money price of wheat increases and no other prices change, the A) relative price of wheat falls. B) opportunity cost of wheat rises. C) demand for wheat increases. D) relative price of wheat is unaffected.

If the money price of hats rises and no other prices change, the I. relative price of a hat rises. II) opportunity cost of a hat rises. A) only I B) both I and II C) only II D) neither I nor II

The price of a DVD rental is $1.50 and the price of a downloaded movie is $1.00. If the price of a DVD rental increases by $0.50, the relative price a downloaded movie A) rises. B) falls. C) does not change. D) might change but more information is needed.

The price of a DVD rental is $2.50 and the price of a downloaded movie is $1.00. If the price of a DVD rental falls by $0.50, the relative price a downloaded movie A) rises. B) falls. C) does not change. D) might change but more information is needed.

The opportunity cost of a good is the same as its A) money price. B) relative price. C) price index. D) none of the above.

The money price of a pizza is $12 per pizza and the money price of a taco is $2 per taco. The relative price of a pizza is A) $12 per pizza. B) $24 per pizza. C) 6 tacos per pizza. D) 1/6 pizza per taco.

Wants, as opposed to demands A) are the unlimited desires of the consumer. B) are the goods the consumer plans to acquire. C) are the goods the consumer has acquired. D) depend on the price.

Demands differ from wants because A) demands are unlimited, whereas wants are limited by income. B) wants require a plan to acquire a good but demands require no such plan. C) wants imply a decision about which demands to satisfy, while demands involve no specific plan to acquire the good. D) demands reflect a decision about which wants to satisfy and a plan to buy the good, while wants are unlimited and involve no specific plan to acquire the good.

Scarcity guarantees that A) demands will exceed wants. B) wants will exceed demands. C) demands will be equal to wants. D) most demands will be satisfied.

The quantity demanded of a good or service is the amount that A) a consumer would like to buy but might not be able to afford. B) is actually bought during a given time period at a given price. C) consumers plan to buy during a given time period at a given price. D) firms are willing to sell during a given time period at a given price.

The quantity demanded is A) always equal to the equilibrium quantity. B) independent of the price of the good. C) the amount of a good that consumers plan to purchase at a particular price. D) independent of consumers' buying plans.

When graphing a demand curve for corn, we are showing the relationship between the quantity demanded of corn and the A) money price of corn. B) relative price of corn. C) income effect. D) substitution effect.

The "law of demand" states that changes in A) demand are related directly to changes in supply. B) the quantity demanded of a good are not related to changes in the quantity supplied. C) the quantity demanded of a good are inversely related to changes in its price. D) demand are inversely related to changes in supply.

The "law of demand" is illustrated by a A) rightward shift of the demand curve. B) leftward shift of the demand curve. C) movement along the demand curve. D) Both answers A and B are correct.

The law of demand states that, other things remaining the same, the higher the price of a good, the A) smaller is the demand for the good. B) larger is the demand for the good. C) smaller is the quantity of the good demanded. D) larger is the quantity of the good demanded.

The law of demand states that the quantity of a good demanded varies A) inversely with its price. B) inversely with the price of substitute goods. C) directly with income. D) directly with population.

The "law of demand" refers to the fact that, all other things remaining the same, when the price of a good rises A) the demand curve shifts rightward. B) the demand curve shifts leftward. C) there is a movement down along the demand curve to a larger quantity demanded. D) there is a movement up along the demand curve to a smaller quantity demanded.

The "law of demand" states that, other things remaining the same, the quantity demanded of any good is A) inversely related to its price. B) directly related to its price. C) positively related to its price. D) directly related to the supply of the good.

The "law of demand" states that, other thing remaining the same, the higher A) the price of a good, the lower is the demand for this good. B) consumers' incomes, the greater is the demand. C) the price of a good, the higher is the quantity demanded. D) the price of a good, the smaller is the quantity demanded.

The law of demand implies that, other things remaining the same A) as the price of a cheeseburger rises, the quantity of cheeseburgers demanded will increase. B) as the price of a cheeseburger rises, the quantity of cheeseburgers demanded will decrease. C) as income increases, the quantity of cheeseburgers demanded will increase. D) as the demand for cheeseburgers increases, the price of a cheeseburger will fall.

The "law of demand" predicts that, other things being equal A) an increase in the price of downloaded music decreases the demand for downloaded music. B) a decrease in the price of gasoline decreases the quantity of gasoline demanded. C) an increase in the price of pizza decreases the quantity of pizza demanded. D) an increase in the price of coffee decreases the quantity of tea demanded.

The law of demand implies that demand curves A) slope down. B) slope up. C) shift rightward whenever the price rises. D) shift leftward whenever the price rises.

Which of the following is consistent with the law of demand? A) An increase in the price of a DVD causes an increase in the quantity of DVDs demanded. B) An increase in the price of a soda causes a decrease in the quantity of soda demanded. C) A decrease in the price of a gallon of milk causes a decrease in the quantity of milk demanded. D) A decrease in the price of juice causes no change in the quantity of juice demanded.

The law of demand implies that if nothing else changes, there is A) a positive relationship between the price of a good and the quantity demanded. B) a negative relationship between the price of a good and the quantity demanded. C) a linear relationship between price of a good and the quantity demanded. D) an exponential relationship between price of a good and the quantity demanded.

As the relative price of a good falls, the substitution effect implies that people buy A) less of that good and more of its substitutes. B) more of that good and less of its substitutes. C) less of that good and less of its substitutes. D) more of that good and more of its substitutes.

When the price of a pizza decreases from $12 to $10, it is definitely the case that the A) income effect means people buy less pizza. B) substitution effect means people buy more pizza. C) quantity demanded of pizza will not change. D) None of the above answers is correct.

The price of cereal rises. As a result, people have cereal for breakfast on fewer days and eat eggs instead. This behavior is an example of A) a decrease in the quantity demanded of cereal because of the substitution effect. B) an increase in the quantity demanded of eggs because of the income effect. C) a decrease in the quantity supplied of cereal because of the substitution effect. D) an increase in the quantity supplied of eggs because of the income effect.

In the market for magazines, the "income effect" means that A) magazines are usually purchased by people with higher than average incomes. B) a decrease in the price of a substitute product like books will make magazine readers feel a little poorer than they were before. C) an increase in the price of magazines will reduce the total purchasing power of magazine readers, making them able to afford fewer magazines. D) an increase in the price of magazines will raise the relative price of magazines to books, causing magazine readers to read more books and fewer magazines.

The "income effect" in the market for aspirin means that A) aspirin are generally taken by people with higher than average incomes. B) a decrease in the price of a substitute good like acetaminophen will make aspirin takers feel a little poorer than they were before. C) an increase in the price of aspirin will reduce the total purchasing power of aspirin takers, making them able to afford fewer aspirin. D) an increase in the price of aspirin will cause headache sufferers to look for a lower priced remedy.

When the price of a pizza decreases from $14 to $12 A) the income effect means people buy less pizza. B) the income effect points out that the total purchasing power of people who buy pizza increases. C) the income effect means that the demand for pizza will not change. D) None of the above answers is correct.

When the price of a good falls, the income effect for a normal good implies that people buy A) less of that good because the relative price of the good has fallen. B) more of that good because the relative price of the good has risen. C) less of that good because they cannot afford to buy all the things they previously bought. D) more of that good because they can afford to buy more of all the things they previously bought.

For normal goods which of the following explains why demand curves slope downward? A) prices and income B) substitutes and complements C) resources and technology D) substitution effect and income effect

Apples are a normal good, so if the price of an apple increases from 50¢ to 60¢, the quantity of apples demanded decrease because of A) the substitution effect only. B) the income effect only. C) a change in income. D) the substitution and income effects.

When the price of an inferior good falls, the substitution effect leads to ________ in the quantity purchased and the income effect leads to ________ in the quantity purchased. A) an increase; an increase B) an increase; a decrease C) a decrease; an increase D) a decrease; a decrease

When the price of a normal good falls, the substitution effect leads to ________ in the quantity purchased and the income effect leads to ________ in the quantity purchased. A) an increase; an increase B) an increase; a decrease C) a decrease; an increase D) a decrease; a decrease

Which of the following influences people's buying plans and does NOT shift the demand curve? A) the price of the good B) the prices of related goods C) income D) preferences

Each point on the demand curve reflects A) all the wants of a given household. B) the highest price consumers are willing and able to pay for that particular unit of a good. C) the highest price sellers will accept for all units they are producing. D) the lowest-cost technology available to produce a good.

The quantity of iPads that people plan to buy this month depends on all of the following EXCEPT the A) price of a rival's tablet. B) price of an iPad. C) the technology used to produce an iPad. D) price of apps.

A substitute is a good A) that can be used in place of another good. B) that is not used in place of another good. C) of lower quality than another good. D) of higher quality than another good.

People buy more of good 1 when the price of good 2 rises. These goods are A) complements. B) substitutes. C) normal goods. D) inferior goods.

Which of the following pairs of goods are most likely substitutes? A) DVDs and DVD players B) cola and lemon lime soda C) lettuce and salad dressing D) peanut butter and gasoline

A complement is a good A) of lower quality than another good. B) used in conjunction with another good. C) used instead of another good. D) of higher quality than another good.

Suppose people buy more of good 1 when the price of good 2 falls. These goods are A) complements. B) substitutes. C) normal. D) inferior.

Ham and eggs are complements. If the price of ham rises, the demand for eggs will A) increase or decrease but the demand curve for ham will not change. B) decrease and the demand curve for ham will shift rightward. C) not change but there will be a movement along the demand curve for eggs. D) decrease and the demand curve for eggs will shift leftward.

A changes in which of the following shifts the demand curve for hamburgers? A) an increase in the price of the meat used to produce hamburgers B) an increase in the price of a hamburger C) a fall in the price of french fries, a complement for hamburgers D) an increase in the number of hamburger restaurants

Which of the following shifts the demand curve for oranges? A) disastrous weather that destroys about half of this year's orange crop B) a decrease in the price of a pound of bananas, a substitute in consumption for oranges C) an increase in the price of the fuel used to transport oranges to supermarkets D) great weather that produces a bumper orange crop this year

What happens to the demand for Xbox games if the price of an Xbox falls? A) The demand for Xboxes decreases because the price of a substitute falls. B) The demand for Xboxes increases because the price of a complement falls. C) The demand for Xboxes decreases because the price of a complement falls. D) The demand for Xboxes remains unchanged.

Oatmeal is a normal good and cold cereal is a substitute for oatmeal. Raisins are a complement for oatmeal. Which of the following increases the demand for oatmeal? A) an increase in the price of raisins B) a decrease in income C) a decrease in population D) an increase in the price of cold cereal

Which of the following shifts the demand curve for hot dogs leftward? A) an increase in the price of a hot dog bun B) a decrease in the price of a hot dog bun C) an increase in the price of a hot dog D) an increase in the price of a hamburger

If the price of product X falls and this change increases the demand for product Y, then A) X and Y are complements. B) X and Y are substitutes. C) X is an inferior good. D) Y is an inferior good.

You observe that an increase in the price of salsa decreases the demand for tortilla chips and increases the demand for potato chips. You can conclude that A) salsa and tortilla chips are substitutes. B) salsa and potato chips are complements. C) tortilla chips and potato chips are complements. D) salsa and tortilla chips are complements.

Cupcakes and granola bars are substitutes in consumption. The price of a granola bar increases so the demand for A) granola bars will increase, that is, the demand curve will shift rightward. B) cupcakes will increase, that is, the demand curve will shift rightward. C) granola bars will decrease, that is, the demand curve will shift leftward. D) cupcakes will decrease, that is, the demand curve will shift leftward.

Sweatshirts and tee-shirts are complements in consumption and the price of a sweatshirt increases. As a result, the demand for A) sweatshirts will increase that is, the demand curve will shift rightward. B) tee-shirts will increase that is, the demand curve will shift rightward. C) sweatshirts will decrease that is, the demand curve will shift leftward. D) tee-shirts will decrease that is, the demand curve will shift leftward.

If the price of an Xbox player falls, then in the market for Xbox games A) the demand curve for Xbox games shifts rightward. B) the demand curve for Xbox games shifts leftward. C) there is a movement downward along the demand curve for Xbox games. D) there is a movement upward along the demand curve for Xbox games.

The observation that the demand curve for grape jelly shifts rightward every time the price of peanut butter falls means that grape jelly and peanut butter are A) complements. B) substitutes. C) inferior goods. D) normal goods.

A decrease in the price of bowling shifts the A) demand curve for bowling balls leftward. B) demand curve for bowling balls rightward. C) supply curve of bowling balls leftward. D) supply curve of bowling balls rightward.

The price of a tomato increases and people buy more lettuce. You infer that lettuce and tomatoes are A) complements. B) normal goods. C) substitutes. D) inferior goods.

Students can rent a Blu-ray movie at Campus Video for $4. As the price of Blu-ray players fall, the A) quantity supplied of Blu-ray movies will decrease. B) demand for Blu-ray movies will increase. C) supply of Blu-ray movies will decrease. D) quantity demanded of Blu-ray movies will increase.

If the price of chicken falls, then in the market for beef A) the demand curve for beef shifts rightward. B) the demand curve for beef shifts leftward. C) there is a movement downward along the demand curve for beef. D) there is a movement upward along the demand curve for beef.

The demand for a good increases when the price of a substitute ________ and also increases when the price of a complement ________. A) rises; rises B) rises; falls C) falls; rises D) falls; falls

An increase the expected future price of a good A) increases its demand. B) decreases its demand. C) increases its supply. D) has no effect on either its demand or its supply.

Which of the following increases the demand for a normal good? A) a decrease in income B) an decrease in the price of a substitute C) an increase in the price of a complement D) the price of the good is expected to increase in the future

A decrease in the expected future price of cars A) increases the current quantity demanded of cars, that is, there is a movement downward along the demand curve for cars. B) increases the current demand for cars, that is, there is a rightward shift of the demand curve for cars. C) decreases the current quantity demanded of cars, that is, there is a movement upward along the demand curve for cars. D) decreases the current demand for cars, that is, there is a leftward shift of the demand curve for cars.

If consumers but not producers expect that the price of soda will rise in November, the A) supply of soda in October will increase. B) demand for soda in October will decrease. C) demand for soda in October will increase. D) supply of soda in October will decrease.

Consumers expect that the price of a gallon of gasoline will rise next week. As a result A) today's supply of gasoline increases. B) today's demand for gasoline increases. C) the price of a gallon of gasoline falls today. D) next week's supply of gasoline decreases.

The demand curve for a normal good shifts leftward if income ________ or the expected future price ________. A) decreases; falls B) decreases; rises C) increases; falls D) increases; rises

If income increases or the price of a complement falls, the A) demand curve for a normal good shifts leftward. B) demand curve for a normal good shifts rightward. C) supply curve of a normal good shifts leftward. D) supply curve of a normal good shifts rightward.

If income decreases or the price of a complement rises A) the demand curve for a normal good shifts leftward. B) the demand curve for a normal good shifts rightward. C) there is an upward movement along the demand curve for the good. D) there is a downward movement along the demand curve for the good.

A consumer might consider in-line skates and elbow-pads to be A) products with upward sloping demand curves. B) unrelated goods. C) complements. D) substitutes.

When people's incomes increase, the demand for a good increases. The good is called A) an inferior good. B) a complement. C) a substitute. D) a normal good.

Normal goods are those for which demand decreases as A) the price of a complement falls. B) the price of a substitute falls. C) income decreases. D) the good's own price rises.

Which of the following decreases the demand for an inferior good? A) an increase in income B) a decrease in the price of a complement C) a decrease in income D) an increase in the price of a substitute

If consumers' incomes increase and the demand for bus rides decreases A) bus rides are a normal good. B) consumers are behaving irrationally. C) bus rides are an inferior good. D) none of the above.

Which of the following is TRUE? A) For an inferior good, when income increases, the demand curve shifts leftward. B) The demand curve for a good shifts leftward when the price of a substitute rises. C) If consumers expect the price of a good will rise in the future, the demand curve shifts leftward. D) An increase in population shifts the demand curve for most goods leftward.

A normal good is a good for which demand A) decreases when income increases. B) increases when income increases. C) decreases when population increases. D) increases when population increases.

Inferior goods are those for which demand increases as A) the price of a substitute falls. B) the price of a substitute rises. C) income decreases. D) income increases.

By definition, an inferior good is a A) want that is not expressed by demand. B) normal substitute good. C) good for which demand decreases when its price rises. D) good for which demand decreases when income increases.

An inferior good is a good for which demand A) decreases when income increases. B) increases when income increases. C) decreases when population increases. D) increases when population increases.

Kelly graduates and her income increases by $25,000 a year. Other things remaining the same, she increases the quantity of clothes she buys. For Kelly, clothes are A) an inferior good. B) a normal good. C) a substitute good. D) a complement good.

Which of the following shifts the demand curve for movie downloads rightward? A) a decrease in the price of downloading a movie B) a 10 percent increase in people's income if movie downloads are a normal good C) a decrease in the price of cable television service D) an increase in the quantity and quality of programming included in the basic cable television service package

If macaroni and cheese is an inferior good, an increase in income will A) not affect the demand for macaroni and cheese. B) decrease the demand for macaroni and cheese. C) increase the demand for macaroni and cheese. D) create no income effect.

If macaroni and cheese is an inferior good, then a decrease in income will result in A) an increase in the demand for macaroni and cheese. B) a decrease in the demand for macaroni and cheese. C) an increase in the supply of macaroni and cheese. D) a decrease in the supply of macaroni and cheese.

Jeep Cherokees are a normal good. If people's incomes increase, the direct result will be A) an increase in the supply of the vehicles. B) a decrease in the demand for the vehicles. C) an increase in the demand for the vehicles. D) Both answers A and C are correct.

Homer changes jobs and his new job pays him a higher income. Before he changed jobs, Homer purchased 3 pounds of tuna and 2 pounds of chicken. After he changed jobs, Homer now purchases 2 pounds of tuna and 3 pounds of chicken. For Homer A) tuna is a normal good and chicken is an inferior good. B) tuna is an inferior good and chicken is a normal good. C) both tuna and chicken are normal goods. D) both tuna and chicken are inferior goods.

If the demand for digital cameras increases when consumers' income rise, then digital cameras are A) a normal good. B) an inferior good. C) a substitute good for video cameras. D) a complement to video cameras.

When income increases, the demand curve for X shifts rightward and the demand curve for Y shifts leftward. These shifts mean that A) X and Y are complements. B) X and Y both normal goods. C) X is an inferior good and Y is a normal good. D) X is a normal good and Y is an inferior good.

Georgine buys more sweaters when her income increases. For Georgine, sweaters are A) a substitute. B) a complement. C) an inferior good. D) a normal good.

Gruel is an inferior good. Hence, a decrease in people's incomes A) shifts the supply curve of gruel leftward. B) decreases the quantity of gruel supplied. C) shifts the demand curve for gruel rightward. D) shifts the demand curve for gruel leftward.

An increase in the number of consumers A) results only in a movement along the demand curve. B) shifts the supply curve leftward. C) shifts the demand curve rightward. D) Both answers B and C are correct.

When economists speak of preferences as influencing demand, they are referring to A) directly observable changes in prices and income. B) an individual's attitudes toward goods and services. C) the excess of wants over the available supplies. D) the availability of a good to all income classes.

A change in which of the following shifts the demand curve? A) the number of sellers in the market B) the price of the resources used to produce the product C) the technology with which the product is produced D) the tastes and preferences of consumers

An unusually warm winter shifts the A) supply curve of gloves rightward. B) supply curve of gloves leftward. C) demand curve for gloves rightward. D) demand curve for gloves leftward.

Which of the following does NOT shift the demand curve for broccoli? A) an increase in the cost of fertilizer used to grow broccoli B) a warning by the U.S. Surgeon General that broccoli causes schizophrenia C) an increase in the price of spinach, a substitute for broccoli, because rodents gobbled up much of this year's spinach crop D) a decrease in the price of spinach, a substitute for broccoli, because of a bumper crop of spinach this year

Which of the following lists has variables that all shift a good's demand curve? A) price of the good, preferences, prices of substitution goods, income B) income, preferences, number of buyers, price of complementary good C) expectation of future price, price of the good, number of buyers, income D) Both answers A and B are correct.

The price of the steel used to produce car engines increases. How does this price hike affect the demand curve for cars? A) The demand curve shifts leftward. B) The demand curve shifts rightward. C) The demand curve does not shift. D) There is not enough information to tell how the change shifts the demand curve for cars.

The quantity demanded of a good or service is the quantity that a consumer A) is willing to buy at a particular price during a given time period. B) actually buys at a particular price during a given time period. C) needs to buy at a particular price during a given time period. D) should buy at a particular price during a given time period.

If the price of chocolate chip cookies rises, then A) the demand curve for chocolate chip cookies shifts rightward. B) the demand curve for chocolate chip cookies shifts leftward. C) there is a movement downward along the demand curve for chocolate chip cookies. D) there is a movement upward along the demand curve for chocolate chip cookies.

Which of the following leads to a movement along the demand curve for spinach but does NOT shift the demand curve for spinach? A) a rise in the price of spinach B) a newly discovered health benefit from eating spinach C) an increase in the price of broccoli, a substitute for spinach D) an increase in income for all spinach lovers

A change in the price of a good A) shifts the good's demand curve and also causes a movement along it. B) shifts the good's demand curve but does not cause a movement along it. C) does not shift the good's demand curve but does cause a movement along it. D) neither shifts the good's demand curve nor causes a movement along it.

If shoes rise in price, the demand curve for shoes ________ and the quantity of shoes demanded ________. A) shifts leftward; decreases B) shifts leftward; does not change C) does not shift; decreases D) does not shift; does not change

A decrease in quantity demanded because of an increase in price is represented by a A) rightward shift of the demand curve. B) leftward shift of the demand curve. C) movement up and to the left along the demand curve. D) movement down and to the right along the demand curve.

A change in which of the following alters buying plans for cars but does NOT shift the demand curve for cars? A) a 5 percent increase in people's income B) a 10 percent decrease in the price of car insurance C) a 20 percent increase in the price of a car D) an increased preference for walking rather than driving

Which of the following would NOT shift the demand curve for turkey? A) an increase in income B) a decrease in the price of ham C) a change in people's preferences for turkey D) a change in the price of a turkey

The statement that "demand increases" means that there is a A) movement to the right along a demand curve. B) movement to the left along a demand curve. C) rightward shift of the demand curve. D) leftward shift of the demand curve.

Cable television companies must pay increased charges by the networks for the programs the cable companies carry. As a result, the price of cable television rises. Thus A) the demand curve for cable television service shifts rightward. B) the demand curve for cable television service shifts leftward. C) there is a movement down the demand curve for cable television to a higher quantity demanded. D) there is a movement up the demand curve for cable television to a smaller quantity demanded.

As the price of a pound of peanuts falls, the A) demand for peanuts increases. B) demand for peanuts decreases. C) quantity of peanuts demanded increases. D) Both answers A and C are correct.

For "an increase in the quantity demanded" but not "an increase in demand" to occur, there must be a A) rightward shift of the demand curve. B) movement along the demand curve. C) rightward shift of the demand curve and a movement along the demand curve. D) Both answers B and C are correct.

If the price per bushel of apples increased from $7.00 to $8.00 because of a poor harvest, the A) demand for apples decreases. B) quantity of apples demanded decreases. C) quantity of apples supplied decreases. D) Both answers A and B are correct.

Which of the following statements is CORRECT? A) A change in the quantity demanded means a shift in the demand curve. B) A change in demand means a movement along the demand curve. C) A change in demand and change in quantity demanded means the same thing. D) A change in demand means a shift in the demand curve while change in the quantity demanded means a movement along the demand curve.

Which of the following best reflects an increase in quantity demanded and NOT an increase in demand? A) A college expects enrollment to increase, despite no change in the tuition. B) Skiing becomes a fashionable winter sports activity. C) The price of hair stylings falls. D) Consumers expect lower prices next month for computers.

-In the above figure, an increase in the quantity demanded is represented by a movement from point d to A) point b only. B) point c only. C) point a. D) both points b and c.

-The figure above shows the demand for fruit snacks. Which movement reflects an increase in demand? A) from point a to point e B) from point a to point b C) from point a to point c D) from point a to point d

-The figure above shows the demand for fruit snacks. Which movement reflects a decrease in demand? A) from point a to point e B) from point a to point b C) from point a to point c D) from point a to point d

-The figure above shows the demand for fruit snacks. Which movement reflects a decrease in quantity demanded but NOT a decrease in demand? A) from point a to point e B) from point a to point b C) from point a to point c D) from point a to point d

-The figure above shows the demand for fruit snacks. Which movement reflects how consumers would react to an increase in the price of a non-fruit snack? A) from point a to point e B) from point a to point b C) from point a to point c D) from point a to point d

-The figure above shows the demand for fruit snacks. Which movement reflects an increase in the price of a substitute for fruit snacks? A) from point a to point e B) from point a to point b C) from point a to point c D) from point a to point d

-The figure above shows the demand for fruit snacks. Which movement reflects an increase in the price of a complement for fruit snacks? A) from point a to point e B) from point a to point b C) from point a to point c D) from point a to point d

-The figure above shows the demand for fruit snacks. Which movement reflects how consumers would react to an increase in the price of a fruit snack that is expected to occur in the future? A) from point a to point e B) from point a to point b C) from point a to point c D) from point a to point d

-The figure above shows the demand for fruit snacks. Which movement reflects an increase in income if fruit snacks are an inferior good? A) from point a to point e B) from point a to point b C) from point a to point c D) from point a to point d

-The figure above shows the demand for fruit snacks. Which movement reflects an increase in income if fruit snacks are a normal good? A) from point a to point e B) from point a to point b C) from point a to point c D) from point a to point d

-The figure above shows the demand for fruit snacks. Which movement reflects a decrease in population? A) from point a to point e B) from point a to point b C) from point a to point c D) from point a to point d

-Consider the demand curves for soft drinks shown in the figure above. Moving from point a to point c means that A) the marginal benefit of each additional soft drink falls. B) the opportunity cost of another soft drink increases. C) people's incomes have decreased. D) the price of a soft drink has increased.

-Consider the demand curves for soft drinks shown in the figure above. Suppose the economy is at point a. An increase in the price of a soda results in a movement to a point such as A) none of the points illustrated. B) b. C) c. D) d.

-Consider the demand curves for soft drinks shown in the figure above. Suppose the economy is at point a. Which of the following could result in a movement to point c? A) a decrease in income B) an increase in the relative price of a soft drink C) a decrease in the relative price of a soft drink D) a decrease in the price of bottled water

-Consider the demand curves for soft drinks shown in the figure above. Suppose the economy is at point a. Which of the following could result in a movement to point d? A) a decrease in income B) an increase in the relative price of a soft drink C) a decrease in the relative price of a soft drink D) a decrease in the price of bottled water

-Consider the demand curves for soft drinks shown in the figure above. Suppose the economy is at point a. What of the following could result in a movement to point b? A) an increase in the price of bottled water B) a decrease in the price of bottled water C) an increase in the opportunity cost of soft drinks D) a decrease in the relative price of a soft drink

-Consider the demand curves for soft drinks shown in the figure above. Initially the economy is at point a. If people come to expect that the price of a soft drink will increase in the future, there will be a movement to a point such as A) none of the points illustrated. B) b. C) c. D) d.

-Consider the demand curves for soft drinks shown in the figure above. A movement from point a to point c represents A) a decrease in quantity demanded. B) an increase in demand. C) an increase in quantity demanded. D) a decrease in demand.

-Consider the demand curves for soft drinks shown in the figure above. A movement from point a to point b represents A) a decrease in quantity demanded. B) an increase in demand. C) an increase in quantity demanded. D) a decrease in demand.

The law of demand concludes that a rise in the price of a golf ball ________ the quantity demanded and ________. A) increases; shifts the demand curve for golf balls rightward B) decreases; shifts the demand curve for golf balls leftward C) decreases; creates a movement up along the demand curve for golf balls D) increases; creates a movement down along the demand curve for golf balls

If a decrease in the price of gasoline increases the demand for large cars, then A) gasoline and large cars are substitutes in consumption. B) gasoline and large cars are complements in consumption. C) gasoline is an inferior good. D) large cars are an inferior good.

A normal good is one A) with a downward sloping demand curve. B) for which demand increases when the price of a substitute rises. C) for which demand increases when income increases. D) none of the above

Some sales managers are talking shop. Which of the following quotations refers to a movement along the demand curve? A) "Since our competitors raised their prices our sales have doubled." B) "It has been an unusually mild winter; our sales of wool scarves are down from last year." C) "We decided to cut our prices, and the increase in our sales has been remarkable." D) none of the above

A recession occurs and people's incomes decrease. Knowing that an iPad is a normal good, you predict that the demand for an iPad A) increases. B) decreases. C) might increase or decrease. D) remains unchanged.

Which of the following is NOT one of the factors that influences the supply of a product? A) technology B) income C) number of suppliers D) expected future prices

The quantity of CDs that firms plan to sell this month depends on all of the following except the A) number of producers of CDs. B) quantity of CDs that people plan to buy. C) wage rate of workers who produce CDs. D) price of a CD.

The quantity supplied of a good is A) the same thing as the quantity demanded at each price. B) the amount that the producers are planning to sell at a particular price during a given time period. C) equal to the difference between the quantity available and the quantity desired by all consumers and producers. D) the amount the firm would sell if it faced no resource constraints.

The quantity supplied of a good or service is the amount that A) producers wish they could sell at a higher price. B) is actually bought during a given time period at a given price. C) people are willing to buy during a given time period at a given price. D) producers plan to sell during a given time period at a given price.

The quantity supplied of a good or service is the quantity that a producer ________ at a particular price during a given time period. A) is willing to sell B) actually sells C) needs to sell D) should sell

The "law of supply" states that, other things remaining the same, firms produce A) more of a good the less it costs to produce it. B) less of a good the more it costs to produce it. C) more of a good the higher its price. D) less of a good as the required resources become scarcer.

The "law of supply" refers to the fact that, all other things remaining the same, when the price of a good rises A) the supply curve shifts leftward. B) the supply curve shifts rightward. C) there is a movement up along the supply curve to a larger quantity supplied. D) there is a movement down along the supply curve to a smaller quantity supplied.

Which of the following explains why supply curves slope upward? A) prices and income B) increasing marginal cost C) resources and technology D) substitutes in production and complements in production

The supply curve slopes upward when graphed against ________, because of ________. A) the price of the good; increasing marginal cost B) the price of the good; decreasing marginal cost C) income; increasing marginal cost D) income; decreasing marginal cost

A fall in the price of a good causes producers to reduce the quantity of the good they are willing to produce. This fact illustrates A) the law of supply. B) the law of demand. C) a change in supply. D) the nature of an inferior good.

Because of increasing marginal cost, most supply curves A) are horizontal. B) are vertical. C) have a negative slope. D) have a positive slope.

A supply curve shows the relation between the quantity of a good supplied and A) income. Usually a supply curve has negative slope. B) income. Usually a supply curve has positive slope. C) the price of the good. Usually a supply curve has negative slope. D) the price of the good. Usually a supply curve has positive slope.

Which of the following is NOT held constant while moving along a supply curve? A) expected future prices B) the number of sellers C) the price of the good itself D) prices of factors of production

Each point on a supply curve represents A) the highest price buyers will pay for the good. B) the lowest price for which a supplier can profitably sell another unit. C) the lowest price buyers will accept per unit of the good. D) the highest price sellers can get for each unit over time.

-In the above figure, what is the minimum supply price for the fourth gallon of ice cream? A) $2.00 B) $3.00 C) $4.00 D) $5.00

Which of the following shifts the supply curve for gasoline rightward? A) a situation in which the quantity demanded exceeds the quantity supplied B) an increase in the price of gasoline C) a decrease in the price of a resource used to produce gasoline, such as crude oil D) an increase in the demand for gas-guzzling, sport utility vehicles

Changes in which of the following shifts the supply curve of hamburgers? A) a rise in the price of soda, a complement for hamburgers B) new research that establishes a link between hamburgers and heart problems C) an increase in the price of meat used to produce hamburgers D) an economy-wide decrease in income because of a long recession

Which of the following decreases the supply of restaurant meals? A) Waiters get a pay raise. B) Consumers' incomes increase and restaurant meals are a normal good. C) Consumers' incomes decrease and restaurant meals are a normal good. D) The price of movies, a complement to restaurant meals, falls.

Which of the following shifts the supply curve rightward? A) an increase in the population B) a positive change in preferences for the good C) a decrease in the price of the good D) a decrease in the price of a factor of production used to produce the good

Auto workers negotiate a wage increase. How does this wage hike affect the supply of cars? A) It decreases the supply. B) It increase the supply. C) It has no effect. D) There is not enough information to tell if the change increases, decreases, or has no effect on the supply of cars.

If a producer can use resources to produce either good A or good B, then A and B are A) complements in production. B) substitutes in production. C) substitutes in consumption. D) complements in consumption.

Good A and good B are substitutes in production. The demand for good A increases so that the price of good A rises. The increase in the price of good A shifts the A) demand curve for good B leftward. B) demand curve for good B rightward. C) supply curve of good B leftward. D) supply curve of good B rightward.

Blank DVDs and prerecorded DVDs are substitutes in production. An increase in the price of a blank DVD will lead to A) an increase in the supply of prerecorded DVDs. B) a decrease in the supply of prerecorded DVDs. C) an increase in the quantity supplied of prerecorded DVDs but not in the supply of prerecorded DVDs. D) a decrease in the quantity supplied of prerecorded DVDs but not in the supply of prerecorded DVDs.

If the price of lumber rises, then, in the market for sawdust A) the supply curve of sawdust shifts leftward. B) the supply curve of sawdust shifts rightward. C) there is a movement downward along the supply curve for sawdust. D) there is a movement upward along the supply curve for sawdust.

A bakery can produce either cakes or cookies. If the price of cookies rises, then A) the supply curve of cake shifts leftward. B) the supply curve of cake shifts rightward. C) there is a movement downward along the supply curve of cakes. D) there is a movement upward along the supply curve of cakes.

Good A and good B are substitutes in production. The demand for good A decreases, which lowers the price of good A. The decrease in the price of good A A) decreases the supply of good B. B) increases the supply of good B. C) decreases the demand for good B. D) increases the demand for good B.

Growers expect that the price of a bushel of wheat will increase in one month. This belief results in A) an increase in current supply of wheat. B) a decrease in current supply of wheat. C) a decrease in future supply of wheat. D) no change in current or future supply of wheat.

An increase in the number of suppliers in a market results in a A) movement up along the supply curve. B) rightward shift in the supply curve. C) leftward shift in the supply curve. D) Both answers A and C are correct.

An increase in the number of fast-food restaurants A) raises the price of fast-food meals. B) increases the demand for fast-food meals. C) increases the supply of fast-food meals. D) increases the demand for substitutes for fast-food meals.

Which of the following increases the supply of a product? A) a fall in the price of the product B) a smaller number of sellers producing the product C) an increase in foreign imports of the product D) higher taxes imposed upon producers of the product

Which of the following decreases the supply of popcorn? A) a decrease in the price of popcorn B) an increase in the price of popcorn C) a technological advance in the production of popcorn D) a decrease in the number of popcorn producers

Over the past decade technological improvements that have lowered the cost of producing an automobile have increased A) both the supply and the demand for automobiles. B) the supply but not the demand for automobiles. C) the demand but not the supply of automobiles. D) neither the supply nor the demand for automobiles.

An increase in technology for producing personal computers leads to A) an increase in the demand for personal computers. B) a decrease in the demand for personal computers. C) an increase in the supply of personal computers. D) a decrease in the supply of personal computers.

Which of the following shifts the supply curve of broccoli? A) an increase in income B) a newly discovered increase in the nutritional value of broccoli C) a newly discovered link between broccoli consumption and tooth decay D) the destruction of much of this year's broccoli crop by hurricanes

A severe drought has damaged this year's lettuce crop. The initial effect on the lettuce market is a A) decrease in the demand for lettuce. B) decrease in the supply of lettuce. C) decrease in both the demand and supply of lettuce. D) rightward movement along the demand curve for lettuce.

-The figure above shows supply curves for soft drinks. Suppose the economy is at point a. A movement to point c could be the result of A) a decrease in technology. B) a decrease in the relative price of a soft drink. C) an increase in the relative price of a soft drink. D) an increase in the money price of a soft drink.

-The figure above shows supply curves for soft drinks. Suppose the economy is at point a. An increase in the price of a soft drink is shown as a movement from point a to A) none of the points that are illustrated. B) point b. C) point c. D) point d.

-The figure above shows supply curves for soft drinks. Suppose the economy is at point a. A movement to point d would be the result of A) an increase in technology. B) a decrease in the relative price of a soft drink. C) an increase in the relative price of a soft drink. D) an increase in the number of soft drink suppliers.

-The figure above shows supply curves for soft drinks. Suppose the economy is at point a. A decrease in the price of sugar used to make soft drinks is shown as a movement from point a to a point such as A) none of the points that are illustrated. B) point b. C) point c. D) point d.

-The figure above shows supply curves for soft drinks. Suppose the economy is at point a. An increase in the number of suppliers would be shown as a movement from point a to a point such as A) none of the points that are illustrated. B) point b. C) point c. D) point d.

-The figure above shows supply curves for soft drinks. Suppose the economy is at point a. A movement to point b could be the result of A) an increase in technology. B) a decrease in the relative price of a soft drink. C) an increase in the relative price of a soft drink. D) an increase in the money price of a soft drink.

Which of the following shifts the supply curve for good X leftward? A) a situation in which quantity demanded exceeds quantity supplied B) an increase in the cost of the machinery used to produce X C) a technological advance in the production of X D) a decrease in the wages of workers employed to produce X

Which of the following will NOT shift the supply curve for pick-up trucks? A) a technological advance B) an increase in the price of a resource used to produce pick-up trucks C) a change in the number of firms supplying pick-up trucks D) a change in the price of pick-up trucks

A change in which of the following would NOT shift the supply curve for sneakers? A) an increase in technology for making sneakers B) an increase in the price of rubber, used to make sneakers C) an increase in the price of sneakers D) None of the above, that is, each change shifts the supply curve

Which of the following shifts the supply curve for oranges? A) disastrous weather that destroys about half of this year's orange crop B) a newly discovered increase in the nutritional value of oranges C) an increase in the price of bananas, a substitute in consumption for oranges D) an increase in income for all orange consumers

Which of the following leads to a movement along the supply curve for shredded wheat but does NOT shift the supply curve for shredded wheat? A) a fall in the price of shredded wheat B) an increase in the cost of machinery used to shred wheat C) perfect weather conditions that resulted in a large wheat crop D) a decrease in the number of shredded wheat producers

Which of the following results in a movement along the supply curve of spinach but does NOT shift the supply curve of spinach? A) disastrous weather that destroys half of this year's spinach crop B) a rise in the price of spinach C) an increase in wages for workers in spinach fields D) great weather that produces a bumper spinach crop this year

Which of the following does NOT shift the supply curve? A) a technological advance B) a decrease in the wages of labor used in production of the good C) a fall in the price of a substitute in production D) an increase in the price of the good

If the price of chocolate chip cookies falls, then A) the supply curve of chocolate chip cookies shifts rightward. B) the supply curve of chocolate chip cookies shifts leftward. C) there is a movement downward along the supply curve of chocolate chip cookies. D) there is a movement upward along the supply curve of chocolate chip cookies.

As the price of a pound of peanuts falls, the A) supply of peanuts increases. B) supply of peanuts decreases. C) quantity of peanuts supplied increases. D) quantity of peanuts supplied decreases.

For a "change in the quantity supplied" but not "a change in supply" to occur, there must be a A) rightward shift of the supply curve. B) rightward shift of the demand curve. C) leftward shift of the demand curve. D) Both answers B and C are correct.

If the price of a good changes but everything else influencing suppliers' planned sales remains constant, there is a A) new supply curve that is to the right of the initial supply curve. B) new supply curve that is to the left of the initial supply curve. C) movement along the supply curve. D) rotation of the initial supply curve around the initial price.

A decrease in the quantity supplied is represented by a A) movement down the supply curve. B) movement up the supply curve. C) rightward shift in the supply curve. D) leftward shift in the supply curve.

Which of the following increases the quantity supplied of good X but does NOT increase the supply of good X? A) a fall in the price of a factor production used to produce X B) an advance in the technology for producing X C) an increase in the price of good Y, a complement in the production of X D) an increase in the price of X

Consider the market for broccoli. If the price of a pound of broccoli increases, what happens to the supply of broccoli? A) The supply of broccoli decreases. B) The supply of broccoli increases. C) There will be no change in the supply of broccoli, but instead there is an increase in the quantity supplied of broccoli. D) There will be no change in the supply of broccoli, but instead there is a decrease in the quantity supplied of broccoli.

Which of the following statements is TRUE? A) An increase in the price of gasoline will decrease the demand for gasoline. B) An increase in the price of gasoline will increase the quantity demanded of gasoline. C) An increase in the price of gasoline will increase the supply of gasoline. D) An increase in the price of gasoline will increase the quantity supplied of gasoline.

-In the figure above, an increase in the supply of oil would result in a movement from A) point a to point e. B) point a to point b. C) point a to point c. D) point a to point d.

-In the figure above, an increase in the quantity of oil supplied but NOT an increase in the supply of oil is shown by a movement from A) point a to point e. B) point a to point b. C) point a to point c. D) point a to point d.

-In the figure above, a decrease in the quantity of oil supplied but NOT a decrease in the supply of oil is shown by a movement from A) point a to point e. B) point a to point b. C) point a to point c. D) point a to point d.

-In the figure above, which movement could be the result of an increase in the wages paid to oil workers? A) point a to point e B) point a to point b C) point a to point c D) point a to point d

-In the figure above, which movement could be the result of the development of a new, more efficient refining technology? A) point a to point e B) point a to point b C) point a to point c D) point a to point d

-The figure above shows the market for candy. People become more concerned that eating candy causes them to gain weight, which they do not like. As a result, the A) demand curve shifts from D₂ to D₁ and the supply curve does not shift. B) demand curve shifts from D₁ to D₂ and the supply curve shifts from S₁ to S₂. C) demand curve shifts from D₂ to D₁ and the supply curve shifts from S₂ to S₁. D) demand curve does not shift, and the supply curve shifts from S₁ to S₂.

-The above figure shows the market for oil. Because of the development of a new deep sea drilling technology the A) demand curve shifts from D₁ to D₂ and the supply curve does not shift. B) demand curve shifts from D₁ to D₂ and the supply curve shifts from S₁ to S₂. C) demand curve does not shift, and the supply curve shifts from S₂ to S₁. D) demand curve does not shift, and the supply curve shifts from S₁ to S₂.

-The above figure shows the market for gasoline. When a hurricane destroys a major refinery that refines oil into gasoline, the A) demand curve for gasoline shifts from D₁ to D₂ and the supply curve of gasoline does not shift. B) demand curve for gasoline shifts from D₁ to D₂ and the supply curve of gasoline shifts from S₂ to S₁. C) demand curve for gasoline does not shift, and the supply curve of gasoline shifts from S₂ to S₁. D) demand curve for gasoline does not shift, and the supply curve of gasoline shifts from S₁ to S₂.

-The above figure shows the market for bicycles. When there is a physical fitness craze so that everyone wants to exercise the A) demand curve for bicycles shifts from D₁ to D₂. B) demand curve for bicycles shifts from D₂ to D₁. C) demand curve and the supply curve of bicycles do not shift. D) supply curve of bicycles shifts from S₁ to S₂.

-The above figure shows the market for french fries at fast food joints. If the price of potatoes rises and simultaneously people become concerned that french fries can cause heart attacks the A) demand curve for french fries shifts from D₂ to D₁ and the supply curve of french fries does not shift. B) demand curve for french fries shifts from D₂ to D₁ and the supply curve of french fries shifts from S₂ to S₁. C) demand curve for french fries shifts from D₂ to D₁ and the supply curve of french fries shifts from S₁ to S₂. D) demand curve for french fries does not shift, and the supply curve of french fries shifts from S₁ to S₂.

A rise in the price of a good causes producers to supply more of the good. This statement illustrates A) the law of supply. B) the law of demand. C) a change in supply. D) the nature of an inferior good.

Which of the following influences does NOT shift the supply curve? A) a rise in the wages paid workers who produce the good B) the development of new technology C) people deciding that they want to buy more of the product D) a decrease in the number of suppliers

To say that "supply increases" for any reason, means there is a A) movement rightward along a supply curve. B) movement leftward along a supply curve. C) shift rightward in the supply curve. D) shift leftward in the supply curve.

The price of jet fuel falls. This fall shifts the A) demand curve for airplane trips rightward. B) demand curve for airplane trips leftward. C) supply curve of airplane trips rightward. D) supply curve of airplane trips leftward.

An increase in the price of the cheese used to produce pizza shifts the supply curve of pizza ________ and shifts the demand curve for pizza ________. A) rightward; leftward B) leftward; leftward C) leftward; not at all D) not at all; leftward

An increase in the number of producers of gruel ________ the supply of gruel and shifts the supply curve of gruel ________. A) increases; rightward B) increases; leftward C) decreases; rightward D) decreases; leftward

Wages for workers producing iPods and similar products will rise next year. Walkman Watch asks you to predict the effect of this change in next year's market for iPods. You predict that the major effect will be that the A) demand curve for an iPod will shift rightward. B) demand curve for an iPod will shift leftward. C) supply curve for an iPod will shift leftward. D) supply curve for an iPod will shift rightward.

Producers of DVDs are able to lower the wage rate that they pay to their workers. You predict that the A) price will rise. B) quantity supplied will decrease. C) supply curve will shift leftward. D) supply curve will shift rightward.

The wage rate paid by Walkman producers falls and at the same time the price of raw materials used in the production of Walkmans rises. You predict that the supply curve of Walkmans will A) shift either leftward or rightward. B) surely shift rightward. C) surely shift leftward. D) surely become steeper.

In a supply and demand figure, the equilibrium price and quantity are found at the A) point where quantity supplied equals quantity demanded. B) horizontal intercept of the demand curve. C) vertical intercept of the supply curve. D) horizontal intercept of the supply and the demand curves.

When a market is in equilibrium A) everyone has all they want of the commodity in question. B) there is no shortage and no surplus at the equilibrium price. C) the number of buyers is exactly equal to the number of sellers. D) the supply curve has the same slope as the demand curve.

The equilibrium price is the price at which the quantity A) sold equals the quantity bought. B) demanded equals the quantity sold. C) demanded equals the quantity supplied. D) supplied equals the quantity bought.

Which of the following is the best way to describe equilibrium in a market? At equilibrium, the A) price is the lowest possible. B) price is usually affordable to most people. C) supply and demand curves can never shift again. D) quantity supplied equals the quantity demanded.

The interaction of supply and demand explains A) the prices of goods and services but not their quantities. B) the quantities of goods and services but not their prices. C) both the prices and the quantities of goods and services. D) neither the prices nor the quantities of goods and services.

-The figure illustrates the market for pens. The equilibrium quantity is A) between 400 and 600 pens, but it is impossible to be precise. B) 5 pens a month. C) 2 pens a month. D) 500 pens a month.

-In the above figure, if the demand curve is D₂, then A) the equilibrium price will be P₁ and the equilibrium quantity will be Q₂. B) the equilibrium price will be P₁ and the equilibrium quantity will be Q₁. C) there will be a shortage equal to Q₂ - Q₁. D) an increase in price will shift the demand curve to D₃.

If the price of a CD is equal to the equilibrium price, there will be ________ of CDs and the price will ________. A) surplus; rise B) surplus; fall C) shortage; fall D) neither a shortage nor surplus; not change

When the price is below the equilibrium price, the quantity demanded A) is less than the equilibrium quantity and the quantity supplied also is less than the equilibrium quantity. B) is less than the equilibrium quantity but the quantity supplied exceeds the equilibrium quantity. C) exceeds the equilibrium quantity and the quantity supplied also exceeds the equilibrium quantity. D) exceeds the equilibrium quantity but the quantity supplied is less than the equilibrium quantity.

If a market is NOT in equilibrium, then which of the following is likely to occur? A) The demand curve will shift to bring the market to equilibrium. B) The supply curve will shift to bring the market to equilibrium. C) The price will adjust to bring the market to equilibrium. D) Both A and B are correct.

If the price of a video download is below its equilibrium price, the quantity supplied is ________ than the quantity demanded. If the price of a video download is above its equilibrium price, the quantity supplied is ________ than the quantity demanded. A) less; greater B) greater; less C) less; less D) greater; greater

A price below the equilibrium price results in A) a surplus. B) a shortage. C) excess supply. D) a further price fall.

If the price of a video rental is below its equilibrium price, there will be a ________ of video rentals and the price will ________. A) shortage; rise B) shortage; fall C) surplus; rise D) surplus; fall

Which of the following CORRECTLY describes how price adjustments eliminate a shortage? A) As the price rises, the quantity demanded decreases while the quantity supplied increases. B) As the price rises, the quantity demanded increases while the quantity supplied decreases. C) As the price falls, the quantity demanded decreases while the quantity supplied increases. D) As the price falls, the quantity demanded increases while the quantity supplied decreases.

Ticket scalpers at the NCAA basketball tournament last year charged prices high above the printed ticket price. This observation is evidence of A) a surplus at printed ticket prices. B) a shortage at printed ticket prices. C) the tournament not being televised. D) the tournament getting too much television exposure.

If the quantity of textbooks supplied is 10,000 per year and the quantity of textbooks demanded is 12,000 per year, there is a ________ in the market and the price will ________. A) shortage; rise B) shortage; fall C) surplus; rise D) surplus; fall

When there is a shortage in the market, the quantity sold is A) greater than the quantity supplied. B) equal to the quantity supplied. C) less than the quantity supplied. D) less than the quantity bought.

When the price is less than the equilibrium price A) there will be a shortage. B) some consumers will be willing to pay a price higher than the prevailing price. C) the price will be forced higher. D) All of the above answers are correct.

If there exists a shortage in the market for snowmobiles, then the price of a snowmobile will A) rise. B) fall. C) neither rise nor fall. D) at first fall then rise.

The existence of a shortage A) means resources are being allocated efficiently. B) is impossible in a market economy. C) pushes the price up. D) pushes the price down.

A shortage causes the A) demand curve to shift leftward. B) supply curve to shift rightward. C) price to fall. D) price to rise.

If the quantity demanded exceeds the quantity supplied, then there is A) a shortage and the price is below the equilibrium price. B) a shortage and the price is above the equilibrium price. C) a surplus and the price is below the equilibrium price. D) a surplus and the price is above the equilibrium price.

-The above table shows the demand schedule and supply schedule for chocolate chip cookies. What is the equilibrium quantity and equilibrium price for chocolate chip cookies? A) 7 pounds, $3.00 per pound B) 2 pounds, $3.00 per pound C) 2 pounds, $6.00 per pound D) 4 pounds, $5.00 per pound

-The above table shows the demand schedule and supply schedule for chocolate chip cookies. If the price is $4.00 per pound, there is a A) shortage of 2 pounds of chocolate chip cookies. B) shortage of 3 pounds of chocolate chip cookies. C) shortage of 5 pounds of chocolate chip cookies. D) surplus of 3 pounds of chocolate chip cookies.

-The above table shows the demand schedule and supply schedule for chocolate chip cookies. An increase in income results in an increase in the demand for chocolate cookies by an amount of 3 pounds at every price. What are the new equilibrium quantity and equilibrium price? A) 5 pounds, $4.00 per pound B) 5 pounds, $6.00 per pound C) 5 pounds, $5.00 per pound D) 4 pounds, $5.00 per pound

If the quantity supplied exceeds the quantity demanded, then there is A) a shortage and the price is below the equilibrium price. B) a shortage and the price is above the equilibrium price. C) a surplus and the price is below the equilibrium price. D) a surplus and the price is above the equilibrium price.

The price of a good will fall if A) there is a surplus at the current price. B) the current price is less than the equilibrium price. C) the quantity demanded exceeds the quantity supplied. D) the price of a complement in consumption falls.

When there is a surplus in the market, the quantity sold is A) equal to the quantity supplied. B) equal to the quantity demanded. C) less than the quantity demanded. D) greater than the quantity bought.

Suppose the equilibrium price for soft drinks is $1.00. If the current price in the soft drink market is $1.25 each A) there will be a surplus of soft drinks. B) there will be a shortage of soft drinks. C) the supply curve of soft drinks will shift leftward. D) the demand curve for soft drinks will shift leftward.

If the quantity of textbooks supplied is 10,000 per year and the quantity of textbooks demanded is 8,000 per year, there is a ________ in the market and the price will ________. A) shortage; rise B) shortage; fall C) surplus; rise D) surplus; fall

A surplus occurs when the price is A) less than the equilibrium price. B) equal to the equilibrium price. C) greater than the equilibrium price. D) None of the above because the existence of a surplus is independent of the price of the good.

If the price is above the equilibrium price, then there is a A) surplus, and market forces will operate to lower price. B) surplus, and market forces will operate to raise price. C) shortage, and market forces will operate to lower price. D) shortage, and market forces will operate to raise price.

When the price of a good is A) below the equilibrium price, quantity supplied exceeds quantity demanded and price rises. B) below the equilibrium price, quantity demanded exceeds quantity supplied and price falls. C) above the equilibrium price, quantity supplied exceeds quantity demanded and price falls. D) above the equilibrium price, quantity demanded exceeds quantity supplied and price rises.

Suppose a market begins in equilibrium. If supply increases, then at the original equilibrium price the quantity demanded is A) is less than the quantity supplied and a surplus results. B) is less than the quantity supplied and a shortage results. C) exceeds the quantity supplied and a surplus results. D) exceeds the quantity supplied and a shortage results.

-The table shows the demand and supply schedules for jeans. A) At $60 a pair, there is a shortage of jeans and the price will fall. B) At $60 a pair, there is a surplus of jeans and the price will rise. C) At $40 a pair, there is a shortage of jeans and the price will rise. D) At $40 a pair, there is a shortage of jeans and the price will fall.

-The above table gives the demand and supply schedules for Blu-ray discs. If the price of a Blu-ray disc is $8, there is a ________ and the price of a compact disc will ________. A) shortage; rise B) shortage; fall C) surplus; rise D) surplus; fall

-The above table gives the demand and supply schedules for Blu-ray discs. Suppose that the price of a Blu-ray disc player increases, resulting in the demand for Blu-ray discs decreasing by 8,000 units at all prices. What are the new equilibrium quantity and equilibrium price of Blu-ray discs? A) 8,000 and $8 B) 16,000 and $16 C) 20,000 and $20 D) 28,000 and $28

-The above table gives the demand and supply schedules for Blu-ray discs. Based on the table, the equilibrium quantity and price of a Blu-ray discs is A) 28,000 and $12. B) 20,000 and $20. C) 16,000 and $24. D) 16,000 and $16.

-Using the data in the above table, the equilibrium quantity and equilibrium price for a cellular telephone is A) 50 thousand and $100. B) 80 thousand and $80. C) 60 thousand and $50. D) 40 thousand and $20.

-Using the data in the above table, at the price of $80 a phone, a A) shortage of 25 thousand cellular telephones occurs. B) surplus of 80 thousand cellular telephones occurs. C) surplus of 25 thousand cellular telephones occurs. D) shortage of 55 thousand cellular telephones occurs.

-The equilibrium price in the above figure is A) $2. B) $4. C) $6. D) $8.

-The equilibrium quantity in the above figure is A) 200 units. B) 300 units. C) 400 units. D) 600 units.

At a price of $10 in the above figure, there is A) a surplus of 200 units. B) a shortage of 200 units. C) a surplus of 400 units. D) a shortage of 400 units.

At a price of $4 in the above figure A) the equilibrium quantity is 400 units. B) there is a surplus of 200 units. C) the quantity supplied is 400 units. D) there is a shortage of 200 units.

If the good in the above figure is a normal good and income rises, then the new equilibrium quantity A) is less than 300 units. B) is 300 units. C) is more than 300 units. D) could be less than, equal to, or more than 300 units.

The initial supply and demand curves for a good are illustrated in the above figure. If there are technological advances in the production of the good, then the new equilibrium price for the good A) is less than $6. B) is $6. C) is more than $6. D) could be less than, equal to, or more than $6.

The initial supply and demand curves for a good are illustrated in the above figure. If there is a rise in the price of a factor of production used to produce the good, then the new equilibrium price A) is less than $6. B) is $6. C) is more than $6. D) could be less than, equal to, or more than $6.

-In the above figure, a price of $15 per dozen for roses would result in A) equilibrium. B) a shortage. C) a surplus. D) downward pressure on prices.

-In the above figure, a price of $15 per dozen roses would result in a ________ so that the price of roses will ________. A) surplus; rise B) surplus; fall C) shortage; rise D) shortage; fall

-In the above figure, a price of $35 per dozen would result in A) a shortage. B) equilibrium. C) a surplus. D) upward pressure on prices.

-In the above figure, if the price is $8 then there is a A) surplus of 100. B) surplus of 200. C) shortage of 100. D) shortage of 200.

Based on the above figure, which of the following is TRUE? A) At a price of $6, quantity demanded is equal to quantity supplied. B) At a price of $4, quantity demanded is greater than quantity supplied. C) At a price of $8, quantity demanded is less than quantity supplied. D) All of the above answers are correct.

If the market for Twinkies is in equilibrium, then A) Twinkies must be a normal good. B) producers would like to sell more at the current price. C) consumers would like to buy more at the current price. D) the quantity supplied equals the quantity demanded.

In a market, at the equilibrium price A) neither buyers nor sellers can do business at a better price. B) buyers are willing to pay a higher price, but sellers do not ask for a higher price. C) buyers are paying the minimum price they are willing to pay for any amount of output and sellers are charging the maximum price they are willing to charge for any amount of production. D) None of the above is true.

If there is surplus of a good, then the quantity demanded ________ the quantity supplied and the price will ________. A) is less than; rise B) is less than; fall C) is greater than; rise D) is greater than; fall

When the demand for a good decreases, its equilibrium price ________ and equilibrium quantity ________. A) falls; decreases B) falls; increases C) rises; decreases D) rises; increases

When demand increases, the equilibrium price ________ and the equilibrium quantity ________. A) rises; decreases B) falls; decreases C) rises; increases D) falls; increases

Which of the following statements is CORRECT? A) When demand increases, both the price and the quantity increase. B) When demand decreases, the price rises and the quantity decreases. C) When supply increases, the quantity decreases and the price rises. D) When supply decreases, both the price and the quantity decrease.

If the U.S. Surgeon General announces that increased wheat consumption could cause heightened anxiety levels among children and adults, what happens to the equilibrium price and quantity of shredded wheat? A) The equilibrium price rises and the equilibrium quantity increases. B) The equilibrium price falls and the equilibrium quantity decreases. C) The equilibrium price rises and the equilibrium quantity decreases. D) The equilibrium price falls and the equilibrium quantity increases.

In March, the quantity of orange juice sold in the town of Jackson was 3000 cartons and the price $3. In May, the quantity of orange juice sold in the town of Jackson was 3500 cartons and the price was $3.20. This change in the price and quantity sold could have been the result of A) the release of a medical study suggesting that consuming orange juice helps prevent cancer. B) a reduction in the number of orange juice coupons provided by local markets. C) the after effects of a cold winter in Florida that killed half of the orange crop. D) the after effects of a warm winter in Florida that increased the orange crop yield by 50 percent.

Suppose the equilibrium price of bottled water has risen from $1.00 per bottle to $2.00 per bottle and the equilibrium quantity has increased. These changes are a result of a ________ shift of the ________ curve for bottled water. A) rightward; demand B) rightward; supply C) leftward; supply D) leftward; demand

If good A is a normal good and income increases, the equilibrium price of A ________ and the equilibrium quantity of A ________. A) rises; increases B) rises; decreases C) falls; decreases D) falls; increases

The price of a gallon of milk falls. Which of the following is a possible cause? A) a decrease in the price of oatmeal, a complement to milk B) a discovery that milk cause diabetes C) Milk is a normal good and people's incomes rise. D) a drought that reduces supplies of feed grains fed to cows that produce milk

An increase in demand combined with no change in supply A) raises the equilibrium price. B) lowers the equilibrium price. C) results in only a movement rightward along the demand curve. D) decreases demand because the supply curve does not shift.

For consumers, goods A and B are complementary goods. The cost of a resource used in the production of A decreases. As a result A) the equilibrium price of B will fall and the equilibrium price of A will rise. B) the equilibrium price of B will rise and the equilibrium price of A will fall. C) the equilibrium prices of both A and B will rise. D) the equilibrium prices of both A and B will fall.

Which of the following raises the equilibrium price and increases the equilibrium quantity of used cars? A) a fall in income if used cars are an inferior good B) an increase in the wage rate paid to used car salespeople C) neither of the above because the question suggests a violation of the "law of demand" D) neither of the above because the question suggests a violation of the "law of supply"

Coffee and sugar are complements. If a poor sugar harvest leads to an increase in the price of sugar, there will also be A) an increase in the price of coffee. B) a decrease in the price of coffee. C) a rightward shift in the demand curve for coffee. D) a leftward shift of the supply curve of coffee.

Long-distance travel by bus is an inferior good. As people's incomes increase and other things remain the same, you predict that the A) price of long-distance travel by bus will fall and the demand for long-distance travel by bus will increase. B) price of long-distance travel by bus will fall. C) demand for long-distance travel by bus will decrease and the price will rise. D) demand for long-distance travel by bus will increase as the price of long-distance travel by bus falls.

If the demand for hamburgers decreases, the equilibrium price A) rises and the equilibrium quantity increases. B) falls and the equilibrium quantity increases. C) rises and the equilibrium quantity decreases. D) falls and the equilibrium quantity decreases.

Suppose that people find out that eating more fish improves their health, leading them to increase their demand for fish. As a result, the equilibrium price of fish ________ and the equilibrium quantity ________. A) rises; decreases B) rises; increases C) falls; decreases D) falls; increases

Doctors find that one aspirin per day reduces the risk of heart attacks. Demand for aspirin will A) increase, so that equilibrium price and equilibrium quantity will increase. B) decrease, so that equilibrium price and equilibrium quantity will increase. C) increase, so that equilibrium price will decrease and equilibrium quantity will increase. D) increase, but the new equilibrium price and quantity are indeterminate.

Until 2007, the price of sport utility vehicles (SUVs) rose and each year more were purchased. This experience suggests that A) there must have been technological advances in the way SUVs are produced. B) the "law of demand" does not hold true in this market. C) there must have movement leftward along the supply curve for SUVs. D) there must have been a rightward shift of the demand curve for SUVs.

Between 2001 and 2015, equilibrium college tuition rose from $15,000 to $27,000 and equilibrium enrollment increased from 16 million to 21 million students. These changes could be the result of A) an increase in demand. B) an increase in supply. C) a decrease in demand. D) a decrease in supply.

If the U.S. Surgeon General announced that increased grapefruit juice consumption could help prevent heart attacks, what would happen to the equilibrium price and quantity of grapefruit juice? A) Price and quantity both increase. B) Price and quantity both decrease. C) Price increases but quantity decreases. D) Price decreases but quantity increases.

If the price of a movie download falls, the rental rate of DVDs ________ and the equilibrium quantity of DVDs rented ________. A) rises; decreases B) rises; increases C) falls; decreases D) falls; increases

What will happen to the equilibrium price and equilibrium quantity of ice cream cones when consumers' incomes decrease? A) If ice cream cones are a normal good, then the equilibrium price and quantity of ice cream cones will decrease. B) If ice cream cones are a normal good, then the equilibrium price and equilibrium quantity of ice cream cones will increase. C) If ice cream cones are an inferior good, then the equilibrium price for an ice cream cone will increase and the equilibrium quantity of ice cream cones will decrease. D) If ice cream cones are an inferior good, then the equilibrium price and quantity of ice cream cones will decrease.

Which of the following raises the price of a used car and increases the equilibrium quantity sold? A) a new 8 percent federal excise tax placed on all new car purchases B) an increase in wages for used car salespeople C) a special rebate program on all new cars D) None of the above answers is correct.

Coffee and sugar are complements. If the supply curve of coffee shifts leftward because of poor weather, then there will be A) an increase in the price of sugar. B) a decrease in the price of sugar. C) a leftward shift of the demand curve for coffee. D) a leftward shift of the supply curve for sugar.

Peanut butter and jelly are complements for consumers. In 2015, the price of peanut butter increased. As a result, the ________ which lead to ________ in the price of jelly and ________ in the quantity of jelly. A) demand for jelly; a decrease; a decrease B) supply of jelly; a decrease; an increase C) supply of jelly; an increase; a decrease D) demand for jelly; an increase; an increase

A decrease in the demand for beef because of concerns over cholesterol results in A) lower beef prices. B) higher beef prices. C) an increase in the supply of beef. D) an offsetting increase in the demand for beef if the price of beef falls.

If more people buy hybrid cars that have high gas mileage, the equilibrium price of gasoline will ________ and the equilibrium quantity will ________. A) rise; increase B) rise; decrease C) fall; increase D) fall; decrease

During the last decade, the price of shoes rose substantially yet people bought more pairs of new shoes each year. This experience suggests that the A) supply curve of shoes shifted leftward. B) demand curve for shoes shifted leftward. C) supply curve of shoes shifted rightward. D) demand curve for shoes shifted rightward.

Suppose we observe that both the equilibrium price of digital cameras and the equilibrium quantity of digital cameras have increased. Which of the following events could be responsible for this? A) technological advances in digital camera production B) consumers' preferences changed in favor of digital cameras C) the price of film cameras fell D) workers who make digital cameras received a pay raise

Suppose we observe that both the equilibrium price of film cameras and the equilibrium quantity of film cameras have fallen. Which of the following could be responsible for this? A) Consumers' preferences changed in favor of digital cameras. B) technological advances in film camera production C) Workers who make cameras received a pay raise. D) The price of digital cameras increased.

During the past twenty years, the prices of prescription drugs, relative to the prices of other goods, have risen, yet Americans buy more prescription drugs than ever. This might be because A) with higher incomes and more older Americans, we have moved rightward along our demand curve for drugs. B) with higher incomes and more older Americans, the demand curve for prescription drugs has shifted rightward. C) more new firms entered the pharmaceutical industry each year, which caused a rightward shift in the supply curve of prescription drugs. D) Both answers A and C are correct.

You observe that in the market for coffee that both the equilibrium price of coffee and the equilibrium quantity have increased. You predict that the demand for coffee A) has increased with no change in the supply of coffee. B) has increased but it is not as large as the increase in supply. C) has not changed but that the supply of coffee has decreased. D) has increased less than supply of coffee has decreased.

Every spring, motorists do more driving than during the winter months. Every spring, the price of gasoline increases and the motorists buy more gasoline. This experience suggests that the A) "law of supply" does not always hold for necessities like gasoline. B) "law of demand" does not always hold for necessities like gasoline. C) laws of supply and demand are both contradicted for gasoline, though only during the spring driving season. D) None of the above answers are correct.