Question 1

Figure 3-7
 
-Refer to Figure 3-7.Assume that the graphs in this figure represent the demand and supply curves for women's clothing.Which panel best describes what happens in this market when the wages of seamstresses rise?

Accepted Answer

A)  Panel (a) 
B)  Panel (b) 
C)  Panel (c) 
D)  Panel (d) E) B) and C)
F) A) and D)

Question 2

Select the phrase that correctly completes the following statement."An increase in input prices caused a decrease in the supply of baseballs.As a result ________."

Accepted Answer

A)  the price of baseballs increased and the demand for baseballs decreased
B)  the equilibrium quantity of baseballs increased
C)  the price of baseballs increased and the quantity demanded of baseballs decreased
D)  the price of baseballs increased. The higher price caused the supply of baseballs to increaseE) A) and C)
F) A) and D)

Question 3

If a union successfully negotiates for higher wages and benefits for steel workers, what impact would this have on supply and demand in the market for steel, assuming no other changes take place in this market?

Accepted Answer

An increase in wages and benefits will s...

Question 4

If a decrease in income leads to a decrease in the demand for mac and cheese, then mac and cheese is

Accepted Answer

A)  a normal good.
B)  a neutral good.
C)  a complement.
D)  a necessity.E) A) and B)
F) A) and C)

Question 5

The supply curve for watches

Accepted Answer

A)  shows the supply of watches consumers are willing and able to buy at any given price.
B)  is downward sloping.
C)  shows the relationship between the quantity of watches firms are willing and able to supply and the quantity of watches consumers are willing and able to purchase.
D)  shows the relationship between the price of watches and the quantity of watches supplied.E) A) and D)
F) B) and C)

Question 6

Figure 3-7
 
-Refer to Figure 3-7.Assume that the graphs in this figure represent the demand and supply curves for rice.What happens in this market if buyers expect the price of rice to fall?

Accepted Answer

A)  Panel (a) 
B)  Panel (b) 
C)  Panel (c) 
D)  Panel (d) E) B) and C)
F) A) and D)

Question 7

Figure 3-1
 
-Refer to Figure 3-1.A decrease in the price of the product would be represented by a movement from

Accepted Answer

A)  A to B.
B)  B to A.
C)  D₁ to D₂.
D)  D₂ to D₁.E) A) and B)
F) A) and C)

Question 8

Scarcity is defined as the situation that exists when the quantity demanded for a good is greater than the quantity supplied.

Accepted Answer

A) True 
 B)False

Question 9

Let D= demand, S = supply, P = equilibrium price, and Q= equilibrium quantity.What happens in the market for walnuts if the Centers for Disease Control and Prevention announces that consuming a half cup of walnuts each week helps to lower levels of bad cholesterol?

Accepted Answer

A)  D increases, S no change, P and Q increase
B)  S increases, D no change, P decreases, Q increases
C)  D and S increase, P and Q decrease
D)  D no change, S increases, P decreases, Q decreasesE) A) and B)
F) All of the above

Question 10

Auctions in recent years have resulted in higher prices paid for letters written by John Wilkes Booth than those written by Abraham Lincoln.What is a reason for this difference in price?

Accepted Answer

A)  There is a surplus of letters written by Booth and a shortage of letters written by Lincoln.
B)  Many people are more fascinated by villains and anti-heroes than by heroic figures.
C)  There are more letters available for collectors to buy that were written by Lincoln than there are letters that were written by Booth.
D)  Booth was a well-known actor; the demand for his letters rose as wealthy actors attempted to buy them.E) A) and B)
F) None of the above

Question 11

The phrase "demand has decreased" means that

Accepted Answer

A)  a demand curve has shifted to the left.
B)  there has been an upward movement along a demand curve.
C)  there has been a downward movement along a demand curve.
D)  a demand curve has shifted to the right.E) A) and D)
F) All of the above

Question 12

Which of the following is the correct way to describe equilibrium in a market?

Accepted Answer

A)  At equilibrium, demand equals supply.
B)  At equilibrium, quantity demanded equals quantity supplied.
C)  At equilibrium, market forces no longer apply.
D)  At equilibrium, scarcity is eliminated.E) A) and D)
F) B) and C)

Question 13

Figure 3-8
 
-Refer to Figure 3-8.The graph in this figure illustrates an initial competitive equilibrium in the market for sugar at the intersection of D₁ and S₁ (point A) . If there is an increase in the price of fertilizer used on sugar cane and there is a decrease in tastes for sugar-sweetened soft drinks, how will the equilibrium point change?

Accepted Answer

A)  The equilibrium point will move from A to B.
B)  The equilibrium point will move from A to C.
C)  There will be no change in the equilibrium point.
D)  The equilibrium point will move from A to E.E) None of the above
F) B) and C)

Question 14

Figure 3-8
 
-Refer to Figure 3-8.The graph in this figure illustrates an initial competitive equilibrium in the market for apples at the intersection of D₁ and S₁ (point A) . If there is an increase in the wages of apple workers and an increase in the price of oranges, a substitute for apples, the equilibrium could move to which point?

Accepted Answer

A)  none of the points shown
B)  B
C)  C
D)  EE) A) and B)
F) A) and C)

Question 15

Figure 3-8
 
-Refer to Figure 3-8.The graph in this figure illustrates an initial competitive equilibrium in the market for apples at the intersection of D₁ and S₁ (point A) . If the price of oranges, a substitute for apples, decreases and the wages of apple workers increase, how will the equilibrium point change?

Accepted Answer

A)  The equilibrium point will move from A to E.
B)  The equilibrium point will move from A to B.
C)  The equilibrium point will move from A to C.
D)  The equilibrium will first move from A to B, then return to A.E) B) and D)
F) B) and C)

Question 16

If, in response to a decrease in the price of grapes, the quantity of grapes demanded increases, economists would describe this as

Accepted Answer

A)  an increase in demand.
B)  an increase in quantity demanded.
C)  a change in consumer income.
D)  an increase in consumers' taste for grapes.E) None of the above
F) All of the above

Question 17

Tomas increased his consumption of potato chips when the price of pistachios increased.For Tomas, potato chips and pistachios are

Accepted Answer

A)  substitutes in consumption.
B)  both inferior goods.
C)  complements in consumption.
D)  both luxury goods.E) B) and C)
F) A) and B)

Question 18

If the demand for a product increases and the supply of the product does not change, equilibrium price and equilibrium quantity will both increase.

Accepted Answer

A) True 
 B)False

Question 19

The demand by all the consumers of a given good or service is the ________ for the good or service.

Accepted Answer

A)  market demand
B)  quantity demanded
C)  law of demand
D)  scheduled demandE) B) and D)
F) B) and C)

Question 20

All else equal, as the price of a product falls, the quantity supplied increases.

Accepted Answer

A) True 
 B)False

Exam 3: Where Prices Come From: the Interaction of Demand and Supply

Figure 3-7 -Refer to Figure 3-7.Assume that the graphs in this figure represent the demand and supply curves for women's clothing.Which panel best describes what happens in this market when the wages of seamstresses rise?

Correct Answer
verified

If, in response to a decrease in the price of grapes, the quantity of grapes demanded increases, economists would describe this as

Correct Answer
verified

The supply curve for watches

Correct Answer
verified

Let D= demand, S = supply, P = equilibrium price, and Q= equilibrium quantity.What happens in the market for walnuts if the Centers for Disease Control and Prevention announces that consuming a half cup of walnuts each week helps to lower levels of bad cholesterol?

Correct Answer
verified

Correct Answer
verified

Tomas increased his consumption of potato chips when the price of pistachios increased.For Tomas, potato chips and pistachios are

Correct Answer
verified

Correct Answer
verified

Auctions in recent years have resulted in higher prices paid for letters written by John Wilkes Booth than those written by Abraham Lincoln.What is a reason for this difference in price?

Correct Answer
verified

Figure 3-1 -Refer to Figure 3-1.A decrease in the price of the product would be represented by a movement from

Correct Answer
verified

If the demand for a product increases and the supply of the product does not change, equilibrium price and equilibrium quantity will both increase.

Correct Answer
verified

The phrase "demand has decreased" means that

Correct Answer
verified

All else equal, as the price of a product falls, the quantity supplied increases.

Correct Answer
verified

If a decrease in income leads to a decrease in the demand for mac and cheese, then mac and cheese is

Correct Answer
verified

The demand by all the consumers of a given good or service is the ________ for the good or service.

Correct Answer
verified

Scarcity is defined as the situation that exists when the quantity demanded for a good is greater than the quantity supplied.

Correct Answer
verified

Select the phrase that correctly completes the following statement."An increase in input prices caused a decrease in the supply of baseballs.As a result ________."

Correct Answer
verified

If a union successfully negotiates for higher wages and benefits for steel workers, what impact would this have on supply and demand in the market for steel, assuming no other changes take place in this market?

Correct Answer
verified
An increase in wages and benefits will s...
View Answer

Correct Answer
verified

Figure 3-7 -Refer to Figure 3-7.Assume that the graphs in this figure represent the demand and supply curves for rice.What happens in this market if buyers expect the price of rice to fall?

Correct Answer
verified

Which of the following is the correct way to describe equilibrium in a market?

Correct Answer
verified

Exam 3: Where Prices Come From: the Interaction of Demand and Supply

Figure 3-7 -Refer to Figure 3-7.Assume that the graphs in this figure represent the demand and supply curves for women's clothing.Which panel best describes what happens in this market when the wages of seamstresses rise?

Correct AnswerverifiedShow Answer

If, in response to a decrease in the price of grapes, the quantity of grapes demanded increases, economists would describe this as

Correct AnswerverifiedShow Answer

The supply curve for watches

Correct AnswerverifiedShow Answer

Let D= demand, S = supply, P = equilibrium price, and Q= equilibrium quantity.What happens in the market for walnuts if the Centers for Disease Control and Prevention announces that consuming a half cup of walnuts each week helps to lower levels of bad cholesterol?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Tomas increased his consumption of potato chips when the price of pistachios increased.For Tomas, potato chips and pistachios are

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Auctions in recent years have resulted in higher prices paid for letters written by John Wilkes Booth than those written by Abraham Lincoln.What is a reason for this difference in price?

Correct AnswerverifiedShow Answer

Figure 3-1 -Refer to Figure 3-1.A decrease in the price of the product would be represented by a movement from

Correct AnswerverifiedShow Answer

If the demand for a product increases and the supply of the product does not change, equilibrium price and equilibrium quantity will both increase.

Correct AnswerverifiedShow Answer

The phrase "demand has decreased" means that

Correct AnswerverifiedShow Answer

All else equal, as the price of a product falls, the quantity supplied increases.

Correct AnswerverifiedShow Answer

If a decrease in income leads to a decrease in the demand for mac and cheese, then mac and cheese is

Correct AnswerverifiedShow Answer

The demand by all the consumers of a given good or service is the ________ for the good or service.

Correct AnswerverifiedShow Answer

Scarcity is defined as the situation that exists when the quantity demanded for a good is greater than the quantity supplied.

Correct AnswerverifiedShow Answer

Select the phrase that correctly completes the following statement."An increase in input prices caused a decrease in the supply of baseballs.As a result ________."

Correct AnswerverifiedShow Answer

If a union successfully negotiates for higher wages and benefits for steel workers, what impact would this have on supply and demand in the market for steel, assuming no other changes take place in this market?

Correct AnswerverifiedAn increase in wages and benefits will s...View AnswerShow Answer

Correct AnswerverifiedShow Answer

Figure 3-7 -Refer to Figure 3-7.Assume that the graphs in this figure represent the demand and supply curves for rice.What happens in this market if buyers expect the price of rice to fall?

Correct AnswerverifiedShow Answer

Which of the following is the correct way to describe equilibrium in a market?

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
An increase in wages and benefits will s...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified