Question 1

"A shortage is the same thing as scarcity." Do you agree or disagree with this statement?
 Why?
 What can cause a shortage to disappear in a market?
 What can cause scarcity to disappear?

Accepted Answer

Disagree with the statement. Scarcity is...

Question 2

An increase in quantity demanded is caused by

Accepted Answer

A)  an increase in income.
B)  a decrease in the price of the good.
C)  a decrease in the price of a complement.
D)  a change in expectations about price in the future.E) A) and D)
F) B) and C)

Question 3

A demand curve is a graphical representation of

Accepted Answer

A)  consumer tastes.
B)  national income.
C)  the demand schedule.
D)  relative prices.E) B) and D)
F) A) and C)

Question 4

A change in the ceteris paribus conditions for supply will lead to a

Accepted Answer

A)  change in quantity supplied.
B)  change in supply.
C)  change in quantity supplied and a change in supply.
D)  change in how consumers view the quality of the good.E) A) and B)
F) A) and C)

Question 5

A demand curve represents a(n)

Accepted Answer

A)  direct relationship between price and quantity demanded.
B)  direct relationship between price and demand.
C)  indirect or inverse relationship between price and quantity demanded.
D)  indirect or inverse relationship between price and supply.E) A) and B)
F) A) and C)

Question 6

A normal good is one for which

Accepted Answer

A)  demand increases as income increases.
B)  demand increases as income decreases.
C)  the demand curve is horizontal.
D)  demand increases as the price of a substitute increases.E) A) and B)
F) A) and C)

Question 7

Which of the following is a non-price determinant of supply?

Accepted Answer

A)  the price of related goods consumers may buy
B)  technological advances in production
C)  consumers' incomes
D)  the number of consumersE) A) and B)
F) A) and C)

Question 8

In order to increase the supply of a good, producers must

Accepted Answer

A)  convince consumers to reduce the quantity demanded.
B)  see an increase in quantity supplied by competitors.
C)  reduce their per-unit costs of producing the good.
D)  cut back on labor to reduce production costs.E) B) and C)
F) A) and D)

Question 9

What is the difference between a normal good and an inferior good?
 How does this relate to the demand curve?

Accepted Answer

A normal good is one for which demand in...

Question 10

Graphically, the market supply curve is obtained by

Accepted Answer

A)  changing the ceteris paribus conditions.
B)  a change in quantity supplied.
C)  horizontally summing quantity supplied at various prices for individual producers.
D)  vertically summing quantity supplied at various prices for individual producers.E) A) and B)
F) All of the above

Question 11

The only variable that can affect a movement along the demand curve is

Accepted Answer

A)  income levels.
B)  the price of the good itself.
C)  the number of buyers.
D)  the number of substitutes.E) None of the above
F) A) and C)

Question 12

What information is provided by a demand curve?
 What variables are measured along the axes of the graph?

Accepted Answer

The demand curve is a graphical represen...

Question 13

The law of demand states that there is

Accepted Answer

A)  an inverse relationship between income and quantity demanded, ceteris paribus.
B)  a direct relationship between income and quantity demanded, ceteris paribus.
C)  no relationship between taste and quantity demanded, ceteris paribus.
D)  an inverse relationship between price and quantity demanded, ceteris paribus.E) B) and C)
F) A) and C)

Question 14

Suppose it is discovered that consumption of butter leads to a longer life. This information would lead to

Accepted Answer

A)  an increase in quantity demanded.
B)  an increase in demand.
C)  a decrease in quantity demanded.
D)  a decrease in demand.E) C) and D)
F) All of the above

Question 15

Briefly discuss the determinants of supply other than price.

Accepted Answer

An increase in the costs of inputs used ...

Question 16

-Refer to the above figure. The rightward shift of the curve could have been caused by

Accepted Answer

A)  a technological improvement.
B)  a technological setback.
C)  an increase in income.
D)  a decrease in income.E) C) and D)
F) A) and B)

Question 17

A decrease in demand would be represented by

Accepted Answer

A)  the price of a good going from $3 to $4.
B)  an increase in the cost of resources used to produce the good.
C)  a movement along the demand curve.
D)  a shift of the demand curve to the left.E) A) and B)
F) A) and C)

Question 18

A subsidy to carrot farmers will

Accepted Answer

A)  increase the quantity of carrots demanded.
B)  decrease the quantity of carrots supplied.
C)  increase the supply of carrots.
D)  leave both the supply and demand of carrots unchanged.E) B) and D)
F) B) and C)

Question 19

A schedule of how much of a good people will purchase for a range of possible prices during a specified time period, other things constant, is the definition of

Accepted Answer

A)  supply.
B)  demand.
C)  a purchasing contract.
D)  an economic market.E) A) and D)
F) B) and D)

Question 20

The arrangements that individuals have with each other to exchange goods is known as

Accepted Answer

A)  demand.
B)  supply.
C)  a market.
D)  complements.E) A) and D)
F) B) and C)

Exam 3: Demand and Supply

The law of demand states that there is

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Suppose it is discovered that consumption of butter leads to a longer life. This information would lead to

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A demand curve is a graphical representation of

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A demand curve represents a(n)

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What is the difference between a normal good and an inferior good? How does this relate to the demand curve?

Correct AnswerverifiedA normal good is one for which demand in...View AnswerShow Answer

A subsidy to carrot farmers will

Correct AnswerverifiedShow Answer

A change in the ceteris paribus conditions for supply will lead to a

Correct AnswerverifiedShow Answer

A decrease in demand would be represented by

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-Refer to the above figure. The rightward shift of the curve could have been caused by

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A schedule of how much of a good people will purchase for a range of possible prices during a specified time period, other things constant, is the definition of

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Which of the following is a non-price determinant of supply?

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The only variable that can affect a movement along the demand curve is

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"A shortage is the same thing as scarcity." Do you agree or disagree with this statement? Why? What can cause a shortage to disappear in a market? What can cause scarcity to disappear?

Correct AnswerverifiedDisagree with the statement. Scarcity is...View AnswerShow Answer

In order to increase the supply of a good, producers must

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A normal good is one for which

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What information is provided by a demand curve? What variables are measured along the axes of the graph?

Correct AnswerverifiedThe demand curve is a graphical represen...View AnswerShow Answer

An increase in quantity demanded is caused by

Correct AnswerverifiedShow Answer

Briefly discuss the determinants of supply other than price.

Correct AnswerverifiedAn increase in the costs of inputs used ...View AnswerShow Answer

The arrangements that individuals have with each other to exchange goods is known as

Correct AnswerverifiedShow Answer

Graphically, the market supply curve is obtained by

Correct AnswerverifiedShow Answer

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A normal good is one for which demand in...
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Disagree with the statement. Scarcity is...
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The demand curve is a graphical represen...
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Correct Answer
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An increase in the costs of inputs used ...
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Correct Answer
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