Question 1

Sellers as a group determine the demand for a product,and buyers as a group determine the supply of a product.

Accepted Answer

A) True 
 B)False

Question 2

A market supply curve shows how the total quantity supplied of a good varies as

Accepted Answer

A)   production technology varies.
B)   price varies.
C)   input prices vary.
D)   demand varies.E) B) and D)
F) A) and B)

Question 3

Which of the following is not a characteristic of a perfectly competitive market?

Accepted Answer

A)   Sellers set the price of the product.
B)   There are many sellers.
C)   Buyers must accept the price the market determines.
D)   All of the above are characteristics of a perfectly competitive market.E) A) and B)
F) None of the above

Question 4

If a seller in a competitive market chooses to charge more than the going price,then

Accepted Answer

A)   the sellers' profits must increase.
B)   the owners of the raw materials used in production would raise the prices for the raw materials.
C)   other sellers would also raise their prices.
D)   buyers will make purchases from other sellers.E) None of the above
F) C) and D)

Question 5

A movement upward and to the left along a demand curve is called a(n)

Accepted Answer

A)   increase in demand.
B)   decrease in demand.
C)   decrease in quantity demanded.
D)   increase in quantity demanded.E) B) and D)
F) A) and B)

Question 6

An increase in the price of ink will shift the supply curve for pens to the left.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following would increase in response to a decrease in the price of ironing boards?

Accepted Answer

A)   the quantity of irons demanded at each possible price of irons
B)   the equilibrium quantity of irons
C)   the equilibrium price of irons
D)   All of the above are correct.E) B) and C)
F) A) and B)

Question 8

Figure 4-7

-Refer to Figure 4-7.The graphs show the demand for cigarettes.In Panel (b) ,the arrows are consistent with which of the following events?

Accepted Answer

A)   an increase in the price of cigarettes
B)   placing a tax on cigarettes
C)   the prohibition of cigarette advertisements on television
D)   decreasing the price of marijuana, given that tobacco and marijuana are complementsE) B) and C)
F) A) and C)

Question 9

Which of the following is not a determinant of demand?

Accepted Answer

A)   the price of a resource that is used to produce the good
B)   the price of a complementary good
C)   the price of the good next month
D)   the price of a substitute goodE) B) and C)
F) A) and B)

Question 10

Assume Diana buys computers in a competitive market.It follows that

Accepted Answer

A)   Diana has a limited number of sellers to turn to when she buys a computer.
B)   Diana will find herself negotiating with sellers whenever she buys a computer.
C)   if Diana buys a large number of computers, the price of computers will rise noticeably.
D)   None of the above is correct.E) C) and D)
F) B) and C)

Question 11

An increase in demand is represented by a

Accepted Answer

A)   movement downward and to the right along a demand curve.
B)   movement upward and to the left along a demand curve.
C)   rightward shift of a demand curve.
D)   leftward shift of a demand curve.E) None of the above
F) A) and C)

Question 12

Figure 4-3
 
-Refer to Figure 4-3.If these are the only two consumers in the market,then the market quantity demanded at a price of $10 is

Accepted Answer

A)   0 units.
B)   5 units.
C)   8.33 units.
D)   25 units.E) B) and C)
F) A) and D)

Question 13

Advances in production technology typically reduce firms' costs.

Accepted Answer

A) True 
 B)False

Question 14

If the price of a good is low,

Accepted Answer

A)   firms would increase profit by increasing output.
B)   the quantity supplied of the good could be zero.
C)   the supply curve for the good will shift to the left.
D)   firms can and should raise the price of the product.E) All of the above
F) C) and D)

Question 15

All goods and services are sold in perfectly competitive markets.

Accepted Answer

A) True 
 B)False

Question 16

A rightward shift of a supply curve is called a(n)

Accepted Answer

A)   increase in supply.
B)   decrease in supply.
C)   decrease in quantity supplied.
D)   increase in quantity supplied.E) None of the above
F) All of the above

Question 17

A decrease in the price of a product and an increase in the number of buyers in the market affect the demand curve in the same general way.

Accepted Answer

A) True 
 B)False

Question 18

If,at the current price,there is a surplus of a good,then

Accepted Answer

A)   sellers are producing more than buyers wish to buy.
B)   the market must be in equilibrium.
C)   the price is below the equilibrium price.
D)   quantity demanded equals quantity supplied.E) B) and D)
F) A) and D)

Question 19

If the number of sellers in a market increases,then the

Accepted Answer

A)   demand in that market will increase.
B)   supply in that market will increase.
C)   supply in that market will decrease.
D)   demand in that market will decrease.E) A) and B)
F) A) and C)

Question 20

Table 4-3
 
-Refer to Table 4-3.If these are the only four buyers in the market,then the market quantity demanded at a price of $2 is

Accepted Answer

A)   0 units.
B)   3.5 units.
C)   12 units.
D)   14 units.E) None of the above
F) A) and B)

Exam 4: The Market Forces of Supply and Demand.

Which of the following is not a determinant of demand?

Correct AnswerverifiedShow Answer

Assume Diana buys computers in a competitive market.It follows that

Correct AnswerverifiedShow Answer

Table 4-3 -Refer to Table 4-3.If these are the only four buyers in the market,then the market quantity demanded at a price of $2 is

Correct AnswerverifiedShow Answer

Which of the following is not a characteristic of a perfectly competitive market?

Correct AnswerverifiedShow Answer

A decrease in the price of a product and an increase in the number of buyers in the market affect the demand curve in the same general way.

Correct AnswerverifiedShow Answer

A rightward shift of a supply curve is called a(n)

Correct AnswerverifiedShow Answer

If a seller in a competitive market chooses to charge more than the going price,then

Correct AnswerverifiedShow Answer

If,at the current price,there is a surplus of a good,then

Correct AnswerverifiedShow Answer

Advances in production technology typically reduce firms' costs.

Correct AnswerverifiedShow Answer

A market supply curve shows how the total quantity supplied of a good varies as

Correct AnswerverifiedShow Answer

Figure 4-3 -Refer to Figure 4-3.If these are the only two consumers in the market,then the market quantity demanded at a price of $10 is

Correct AnswerverifiedShow Answer

Figure 4-7 -Refer to Figure 4-7.The graphs show the demand for cigarettes.In Panel (b) ,the arrows are consistent with which of the following events?

Correct AnswerverifiedShow Answer

If the number of sellers in a market increases,then the

Correct AnswerverifiedShow Answer

Sellers as a group determine the demand for a product,and buyers as a group determine the supply of a product.

Correct AnswerverifiedShow Answer

An increase in the price of ink will shift the supply curve for pens to the left.

Correct AnswerverifiedShow Answer

An increase in demand is represented by a

Correct AnswerverifiedShow Answer

If the price of a good is low,

Correct AnswerverifiedShow Answer

All goods and services are sold in perfectly competitive markets.

Correct AnswerverifiedShow Answer

A movement upward and to the left along a demand curve is called a(n)

Correct AnswerverifiedShow Answer

Which of the following would increase in response to a decrease in the price of ironing boards?

Correct AnswerverifiedShow Answer

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