Question 1

Which of the following is most likely to increase the supply of corn?

Accepted Answer

If the price of soybeans (a substitute crop) drops significantly, farmers may switch to growing corn instead, resulting in an increase in the supply of corn.

Question 2

Which of the following would not cause a shift in the supply curve for a good?

Accepted Answer

An increase in demand would not cause a shift in the supply curve, but rather a movement along the existing supply curve as producers increase the quantity supplied at each given price. The other options (B, C, and D) all involve changes in the costs of production, which would cause a shift in the supply curve.

Question 3

The price of a good will fall when:

Accepted Answer

When there is a surplus of a good, meaning there is more supply than demand, sellers may lower the price in order to try and sell the excess inventory. This can lead to a decrease in the price of the good.

Question 4

To finance medical care, the federal government raises the tax per pack paid by sellers of cigarettes. Other things being equal, the price of cigarettes rises because of a(n):

Accepted Answer

By raising the tax per pack paid by sellers, the government increases the cost for producers to supply cigarettes to the market, which decreases the quantity supplied at every price level. This results in a leftward shift of the supply curve for cigarettes, causing an increase in the equilibrium price and a decrease in the equilibrium quantity. Therefore, the price of cigarettes rises due to a leftward shift of the supply curve for cigarettes.

Question 5

Assuming that soybeans and tobacco can both be grown on the same land, a decrease in the price of tobacco, other things being equal, causes a(n):

Accepted Answer

If the price of tobacco decreases, farmers may shift their focus to growing more soybeans because they will be relatively more profitable to produce. This will increase the supply of soybeans, causing a rightward shift in the supply curve. Therefore, choice C is the correct answer.

Question 6

The price of a good will fall if:

Accepted Answer

If there is an excess supply of the good, meaning there are more sellers than buyers, sellers will have to lower their prices to make the goods more attractive to buyers. This will result in a fall in the price of the good.

Question 7

Which of the following would decrease the supply of airline travel?

Accepted Answer

If fuel costs increase, it becomes more expensive to operate airlines, leading to potential decreases in supply as airlines try to cut costs. This could lead to fewer flights being offered or higher ticket prices. A, B, and D would not necessarily decrease the supply of airline travel.

Question 8

Which of the following is the least likely to result from an advance in technology?

Accepted Answer

An advance in technology is likely to shift the supply curve to the right, indicating an increase in supply. Options A and B suggest an increase in supply, which is a likely outcome of technological advancement. Option C suggests a decrease in supply, which is unlikely to result from technological advancement.

Question 9

Exhibit 3-4 Supply curves In Exhibit 3-4, which of the following could have caused the shift in the supply curve from S₁ to S₂?

Accepted Answer

The answer of Exhibit 3-4 Supply curves

In Exhibit 3-4, which...

Question 10

An improvement in a firm's technology that improves productivity results in a(n):

Accepted Answer

An improvement in a firm's technology that improves productivity increases the efficiency of production, leading to an increase in output for the same amount of resources. This leads to the firm's willingness to supply a larger quantity than before at any given price, resulting in a rightward shift of the supply curve. Choice A and D are incorrect because a leftward shift of the supply curve implies a decrease in supply, while a downward movement indicates a decrease in price. Choice B is incorrect because an upward movement along the supply curve indicates an increase in price, which may not be the case here.

Question 11

A reduction in production costs will not result in which of the following?

Accepted Answer

A reduction in production costs will lead to an increase in supply, which is represented by a rightward shift of the supply curve. It will also lead to greater willingness and ability of producers to supply a larger quantity at any given price. However, it will not directly affect the willingness and ability of consumers to demand a larger quantity at any given price, which is represented by a shift in the demand curve.

Question 12

Assume that oranges and peaches can both be grown on the same type of land, a decrease in the price of peaches, other things being equal, will cause a(n):

Accepted Answer

Given that oranges and peaches can be grown on the same type of land, a decrease in the price of peaches makes growing oranges relatively more attractive. Producers might shift resources from growing peaches to growing oranges, increasing the supply of oranges. This scenario is represented by a rightward shift of the supply curve for oranges.

Question 13

Assume Q_s represents the quantity supplied at a given price and Q_d represents the quantity demanded at the same given price. Which of the following market conditions produce a downward movement of the price?

Accepted Answer

When quantity supplied (1,000) is greater than quantity demanded (750), it indicates a surplus in the market. This surplus typically leads to a downward movement in price to encourage more demand and balance the market.

Question 14

A technological improvement in the production of good X causes the:

Accepted Answer

Technological improvements in production increase the efficiency of producing goods, thus lowering the cost of production. This will increase the supply of good X and shift the supply curve to the right. The demand curve for X is not affected by technological improvements in production.

Question 15

There is a technological advance in the production of digital watches. This will cause:

Accepted Answer

The technological advance in the production of digital watches will increase the supply of digital watches, as it will become easier and more cost-effective to produce them. This increase in supply should lead to lower prices and greater availability, which could in turn stimulate demand. However, the initial impact will be on supply rather than demand.

Question 16

If there is a surplus in the oil market, then the price of oil will:

Accepted Answer

When there is a surplus in the oil market, it means that there is more supply than demand for oil. This causes a decrease in price as producers try to sell more of their product to stay competitive. Therefore, the price of oil will fall.

Question 17

"Because of unseasonable cold weather, much of the peach crop has been destroyed." This statement indicates that the:

Accepted Answer

The statement indicates that a portion of the peach crop has been destroyed due to unseasonable cold weather. This means that there will be less of a supply of peaches available, which will lead to a decrease in the quantity of peaches available at any given price (decrease in supply). This will cause the price of peaches to increase, not fall. Demand for peaches is not being affected by the cold weather.

Question 18

A shift occurs in the supply curve for salt when:

Accepted Answer

Improvements in the production process would shift the supply curve for salt, increasing the quantity supplied at every price, and thus shifting the curve rightward. Increases in the price of salt (A) would result in a movement along the supply curve, not a shift in the curve itself, as quantity supplied would only change in response to the higher price. News about the health effects of salt (C) or consumer expectations of future price changes (D) would affect demand for salt, not supply.

Question 19

When there is a surplus of a product in a market the:

Accepted Answer

A surplus occurs when the price is above the equilibrium price, leading to excess supply over demand.

Question 20

A surplus of wheat:

Accepted Answer

A surplus of wheat occurs when the quantity supplied exceeds the quantity demanded at the current price, not when the quantity demanded exceeds the quantity supplied. This is more likely when the price of wheat is above the equilibrium, not below, as higher prices discourage demand. Choices A, C, and D are incorrect based on economic principles.

Quiz 3: Market Demand and Supply

Which of the following is most likely to increase the supply of corn?

Which of the following would not cause a shift in the supply curve for a good?

The price of a good will fall when:

To finance medical care, the federal government raises the tax per pack paid by sellers of cigarettes. Other things being equal, the price of cigarettes rises because of a(n) :

Assuming that soybeans and tobacco can both be grown on the same land, a decrease in the price of tobacco, other things being equal, causes a(n) :

The price of a good will fall if:

Which of the following would decrease the supply of airline travel?

Which of the following is the least likely to result from an advance in technology?

Exhibit 3-4 Supply curves In Exhibit 3-4, which of the following could have caused the shift in the supply curve from S₁ to S₂?

An improvement in a firm's technology that improves productivity results in a(n) :

A reduction in production costs will not result in which of the following?

Assume that oranges and peaches can both be grown on the same type of land, a decrease in the price of peaches, other things being equal, will cause a(n) :

Assume Q_s represents the quantity supplied at a given price and Q_d represents the quantity demanded at the same given price. Which of the following market conditions produce a downward movement of the price?

A technological improvement in the production of good X causes the:

There is a technological advance in the production of digital watches. This will cause:

If there is a surplus in the oil market, then the price of oil will:

"Because of unseasonable cold weather, much of the peach crop has been destroyed." This statement indicates that the:

A shift occurs in the supply curve for salt when:

When there is a surplus of a product in a market the:

A surplus of wheat:

Quiz 3: Market Demand and Supply

Which of the following is most likely to increase the supply of corn?

Which of the following would not cause a shift in the supply curve for a good?

The price of a good will fall when:

To finance medical care, the federal government raises the tax per pack paid by sellers of cigarettes. Other things being equal, the price of cigarettes rises because of a(n) :

Assuming that soybeans and tobacco can both be grown on the same land, a decrease in the price of tobacco, other things being equal, causes a(n) :

The price of a good will fall if:

Which of the following would decrease the supply of airline travel?

Which of the following is the least likely to result from an advance in technology?

Exhibit 3-4 Supply curves In Exhibit 3-4, which of the following could have caused the shift in the supply curve from S1 to S2?

An improvement in a firm's technology that improves productivity results in a(n) :

A reduction in production costs will not result in which of the following?

Assume that oranges and peaches can both be grown on the same type of land, a decrease in the price of peaches, other things being equal, will cause a(n) :

Assume Qs represents the quantity supplied at a given price and Qd represents the quantity demanded at the same given price. Which of the following market conditions produce a downward movement of the price?

A technological improvement in the production of good X causes the:

There is a technological advance in the production of digital watches. This will cause:

If there is a surplus in the oil market, then the price of oil will:

"Because of unseasonable cold weather, much of the peach crop has been destroyed." This statement indicates that the:

A shift occurs in the supply curve for salt when:

When there is a surplus of a product in a market the:

A surplus of wheat:

Exhibit 3-4 Supply curves In Exhibit 3-4, which of the following could have caused the shift in the supply curve from S₁ to S₂?

Assume Q_s represents the quantity supplied at a given price and Q_d represents the quantity demanded at the same given price. Which of the following market conditions produce a downward movement of the price?