Question 1

If consumers' surplus is $30 and the price paid for the good is $50,then the maximum price a buyer is willing and able to pay for the good is

Accepted Answer

A)   $80.
B)   $30.
C)   $50.
D)   $20.
E)   There is not enough information to answer the question.F) B) and E)
G) B) and D)

Question 2

On a supply-and-demand diagram,quantity demanded equals quantity supplied

Accepted Answer

A)   only at the single equilibrium price.
B)   at every price at or above the equilibrium price.
C)   at every price at or below the equilibrium price.
D)   at every price.E) C) and D)
F) A) and C)

Question 3

Oil producers expect that oil prices next year will be lower than oil prices this year.As a result,oil producers are most likely to

Accepted Answer

A)   place more oil on the market this year, thus shifting the present supply curve of oil rightward.
B)   hold some oil off the market this year, thus shifting the present supply curve of oil leftward.
C)   place more oil on the market this year, thus increasing the quantity supplied of oil at lower but not higher prices.
D)   hold some oil off the market this year, thus decreasing the quantity supplied of oil at lower but not higher prices.E) A) and D)
F) B) and C)

Question 4

An increase in the expected price of corn would likely do the following to the current supply and demand for corn:

Accepted Answer

A)   increase both the demand and the supply.
B)   decrease both the demand and the supply.
C)   increase the demand, but decrease the supply.
D)   increase the supply, but decrease the demand.E) A) and C)
F) None of the above

Question 5

Exhibit 3-1
 
-Refer to Exhibit 3-1.Equilibrium price and quantity are

Accepted Answer

A)   $2 and 250 units.
B)   $4 and 250 units.
C)   $2 and 150 units.
D)   $6 and 250 units.
E)   none of the aboveF) A) and D)
G) C) and E)

Question 6

If the demand for a good falls by less than the supply of the good rises,then the good's equilibrium price will __________ and its equilibrium quantity will __________.

Accepted Answer

A)   rise; fall
B)   rise; rise
C)   fall; fall
D)   fall; riseE) None of the above
F) B) and C)

Question 7

Labor is a resource that is necessary to produce many goods."If the price of labor falls," says the economist,"the prices of goods will soon follow." How does this work?

Accepted Answer

A)   If the price of labor falls, the supply of goods rises, and the prices of those goods fall.
B)   If the price of labor falls, the quantity supplied of goods rises, and the prices of those goods fall.
C)   If the price of labor falls, the demand for goods falls, and the prices of those goods fall.
D)   If the price of labor falls, the demand for goods rises, and the prices of those goods fall.
E)   If the price of labor falls, the supply of goods falls, and the prices of those goods fall.F) None of the above
G) B) and D)

Question 8

Explain why the price of a good tends to fall when there is a surplus of the good. Give a hypothetical numerical example to help support your answer.

Accepted Answer

Surpluses always occur at prices that ar...

Question 9

Exhibit 3-6
 
-Refer to Exhibit 3-6.If an increase in the price of good Y causes the demand for good X to shift from D? to D?,goods X and Y are

Accepted Answer

A)   normal goods.
B)   inferior goods.
C)   substitutes.
D)   complements.
E)   neutral goods.F) B) and D)
G) B) and E)

Question 10

With respect to the supply and demand for a given product,describe the connection that exists between equilibrium/disequilibrium and predictions. Cite your own unique example in order to help support your answer.

Accepted Answer

Economists use the concepts of equilibri...

Question 11

In moving along a demand curve,which of the following is NOT held constant?

Accepted Answer

A)   the prices of substitute goods
B)   the prices of complementary goods
C)   consumer incomes
D)   the price of the good for which the demand curve is relevantE) None of the above
F) B) and D)

Question 12

Good X is a normal good.If the average income of those who buy good X rises,the _____________ curve for good X will shift ____________ resulting in a(n) _____________ in the equilibrium price of X and a(n) ____________ in the equilibrium quantity of X.

Accepted Answer

A)   supply; rightward; decrease; increase.
B)   demand; leftward; decrease; decrease
C)   demand; rightward; increase; increase
D)   supply; leftward; increase; decrease
E)   supply; leftward; increase; increaseF) B) and D)
G) A) and B)

Question 13

Suppose Smith wants one iPod no matter what the price is between $0 and $150,Jones wants one iPod no matter what the price is between $0 and $200,and Young wants one iPod no matter what the price is between $0 and $250. In this case,each individual buyer's demand curve will be __________________ and the market demand curve will be __________________.

Accepted Answer

A)   downward sloping; vertical
B)   vertical; downward sloping
C)   vertical; vertical
D)   downward sloping; downward slopingE) None of the above
F) A) and B)

Question 14

When Hurricane Katrina hit the Gulf Coast of the United States in 2005 it destroyed 5,000,000 acres of timber. Given that lumber is timber that has been sawed or split into planks and boards,explain in terms of supply and/or demand how the hurricane impacted each of the following markets (be sure to note the expected resulting impact on equilibrium price and quantity): a.
Domestic lumber b.
Imported lumber c.
New home construction

Accepted Answer

a.
The severe weather would be expected ...

Question 15

Exhibit 3-14
 
-Refer to Exhibit 3-14. At a price of $10,there is a ____________ unit ____________ of good X.

Accepted Answer

A)   340; surplus
B)   230; shortage
C)   60; surplus
D)   340; shortage
E)   270; shortageF) A) and E)
G) C) and D)

Question 16

Exhibit 3-14
 
-Refer to Exhibit 3-14. At a price of $12,there is a ____________ unit ____________ of good X.

Accepted Answer

A)   195; shortage
B)   230; shortage
C)   195; surplus
D)   230; surplus
E)   180; shortageF) D) and E)
G) A) and B)

Question 17

Which of the following is consistent with the law of demand?

Accepted Answer

A)   People substitute higher-priced goods for higher-quality goods.
B)   People substitute some higher-priced goods for other higher-priced goods.
C)   People substitute lower-priced goods for higher-priced goods.
D)   People substitute some lower-priced goods for other lower-priced goods.E) B) and C)
F) A) and D)

Question 18

Exhibit 3-3
 
-If the supply of and demand for a product both decrease,then equilibrium

Accepted Answer

A)   quantity and equilibrium price must both decline.
B)   quantity must decline, but equilibrium price may either rise, fall, or remain unchanged.
C)   price must fall, but equilibrium quantity may either rise, fall, or remain unchanged.
D)   quantity must fall and equilibrium price must rise.E) None of the above
F) A) and B)

Question 19

At a price below the equilibrium price,there is

Accepted Answer

A)   a surplus.
B)   a shortage.
C)   excess supply.
D)   sub-equilibrium.
E)   none of the aboveF) A) and E)
G) B) and E)

Question 20

Which of the following statements is true?

Accepted Answer

A)   To an economist, demand is different from quantity demanded.
B)   A demand schedule is the numerical tabulation of the law of demand.
C)   A demand curve is the graphical representation of the direct relationship between price and quantity demanded.
D)   a and b
E)   a, b, and cF) B) and D)
G) C) and D)

Exam 3: Supply and Demand: Theory

Exhibit 3-6 -Refer to Exhibit 3-6.If an increase in the price of good Y causes the demand for good X to shift from D? to D?,goods X and Y are

Correct Answer
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Correct Answer
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With respect to the supply and demand for a given product,describe the connection that exists between equilibrium/disequilibrium and predictions. Cite your own unique example in order to help support your answer.

Correct Answer
verified
Economists use the concepts of equilibri...
View Answer

Exhibit 3-14 -Refer to Exhibit 3-14. At a price of $12,there is a unit of good X.

Correct Answer
verified

Explain why the price of a good tends to fall when there is a surplus of the good. Give a hypothetical numerical example to help support your answer.

Correct Answer
verified
Surpluses always occur at prices that ar...
View Answer

On a supply-and-demand diagram,quantity demanded equals quantity supplied

Correct Answer
verified

If the demand for a good falls by less than the supply of the good rises,then the good's equilibrium price will and its equilibrium quantity will .

Correct Answer
verified

Good X is a normal good.If the average income of those who buy good X rises,the _______ curve for good X will shift resulting in a(n) _ in the equilibrium price of X and a(n) ______ in the equilibrium quantity of X.

Correct Answer
verified

Labor is a resource that is necessary to produce many goods."If the price of labor falls," says the economist,"the prices of goods will soon follow." How does this work?

Correct Answer
verified

Exhibit 3-1 -Refer to Exhibit 3-1.Equilibrium price and quantity are

Correct Answer
verified

In moving along a demand curve,which of the following is NOT held constant?

Correct Answer
verified

At a price below the equilibrium price,there is

Correct Answer
verified

An increase in the expected price of corn would likely do the following to the current supply and demand for corn:

Correct Answer
verified

Exhibit 3-14 -Refer to Exhibit 3-14. At a price of $10,there is a unit of good X.

Correct Answer
verified

Correct Answer
verified
a.
The severe weather would be expected ...
View Answer

Exhibit 3-3 -If the supply of and demand for a product both decrease,then equilibrium

Correct Answer
verified

If consumers' surplus is $30 and the price paid for the good is $50,then the maximum price a buyer is willing and able to pay for the good is

Correct Answer
verified

Which of the following is consistent with the law of demand?

Correct Answer
verified

Which of the following statements is true?

Correct Answer
verified

Oil producers expect that oil prices next year will be lower than oil prices this year.As a result,oil producers are most likely to

Correct Answer
verified

Exam 3: Supply and Demand: Theory

Exhibit 3-6 -Refer to Exhibit 3-6.If an increase in the price of good Y causes the demand for good X to shift from D? to D?,goods X and Y are

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

With respect to the supply and demand for a given product,describe the connection that exists between equilibrium/disequilibrium and predictions. Cite your own unique example in order to help support your answer.

Correct AnswerverifiedEconomists use the concepts of equilibri...View AnswerShow Answer

Exhibit 3-14 -Refer to Exhibit 3-14. At a price of $12,there is a ____________ unit ____________ of good X.

Correct AnswerverifiedShow Answer

Explain why the price of a good tends to fall when there is a surplus of the good. Give a hypothetical numerical example to help support your answer.

Correct AnswerverifiedSurpluses always occur at prices that ar...View AnswerShow Answer

On a supply-and-demand diagram,quantity demanded equals quantity supplied

Correct AnswerverifiedShow Answer

If the demand for a good falls by less than the supply of the good rises,then the good's equilibrium price will __________ and its equilibrium quantity will __________.

Correct AnswerverifiedShow Answer

Good X is a normal good.If the average income of those who buy good X rises,the _____________ curve for good X will shift ____________ resulting in a(n) _____________ in the equilibrium price of X and a(n) ____________ in the equilibrium quantity of X.

Correct AnswerverifiedShow Answer

Labor is a resource that is necessary to produce many goods."If the price of labor falls," says the economist,"the prices of goods will soon follow." How does this work?

Correct AnswerverifiedShow Answer

Exhibit 3-1 -Refer to Exhibit 3-1.Equilibrium price and quantity are

Correct AnswerverifiedShow Answer

In moving along a demand curve,which of the following is NOT held constant?

Correct AnswerverifiedShow Answer

At a price below the equilibrium price,there is

Correct AnswerverifiedShow Answer

An increase in the expected price of corn would likely do the following to the current supply and demand for corn:

Correct AnswerverifiedShow Answer

Exhibit 3-14 -Refer to Exhibit 3-14. At a price of $10,there is a ____________ unit ____________ of good X.

Correct AnswerverifiedShow Answer

Correct Answerverifieda.The severe weather would be expected ...View AnswerShow Answer

Exhibit 3-3 -If the supply of and demand for a product both decrease,then equilibrium

Correct AnswerverifiedShow Answer

If consumers' surplus is $30 and the price paid for the good is $50,then the maximum price a buyer is willing and able to pay for the good is

Correct AnswerverifiedShow Answer

Which of the following is consistent with the law of demand?

Correct AnswerverifiedShow Answer

Which of the following statements is true?

Correct AnswerverifiedShow Answer

Oil producers expect that oil prices next year will be lower than oil prices this year.As a result,oil producers are most likely to

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Economists use the concepts of equilibri...
View Answer

Exhibit 3-14 -Refer to Exhibit 3-14. At a price of $12,there is a unit of good X.

Correct Answer
verified

Correct Answer
verified
Surpluses always occur at prices that ar...
View Answer

Correct Answer
verified

If the demand for a good falls by less than the supply of the good rises,then the good's equilibrium price will and its equilibrium quantity will .

Correct Answer
verified

Good X is a normal good.If the average income of those who buy good X rises,the _______ curve for good X will shift resulting in a(n) _ in the equilibrium price of X and a(n) ______ in the equilibrium quantity of X.

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Exhibit 3-14 -Refer to Exhibit 3-14. At a price of $10,there is a unit of good X.

Correct Answer
verified

Correct Answer
verified
a.
The severe weather would be expected ...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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