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Exam 3: Demand, Supply, and Market Equilibrium

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Question 121

Multiple Choice

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An increase in the quantity demanded means that

A) given supply, the price of the product can be expected to decline.
B) price has declined and consumers therefore want to purchase more of the product.
C) the demand curve has shifted to the right.
D) the demand curve has shifted to the left.

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Question 122

Multiple Choice

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Refer to the above graph showing the market for a product. Which of the following would best explain why the shift in demand from D1 to D2 would cause price to rise from P1 to P2?

A) After the shift in the demand, there would be a surplus at price P2.
B) After the shift in the demand, there would be a shortage at price P2.
C) After the shift in the demand, there would be a shortage at price P1.
D) After the shift in the demand, there would be a surplus at price P1.

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Question 123

Multiple Choice

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Suppose that at prices of $1, $2, $3, $4, and $5 for product Z, the corresponding quantities supplied are 3, 4, 5, 6, and 7 units, respectively. Which of the following would increase the quantities supplied Of Z to, say, 6, 8, 10, 12, and 14 units at these prices?

Which of the diagrams illustrates the effect of a governmental subsidy on the market for AIDS research?

With a downsloping demand curve and an upsloping supply curve for a product, a decrease in resource prices will

In which of the following statements are the terms "demand" and "quantity demanded" used correctly?

The table below shows the weekly demand for hamburgers in a market where there are just three buyers. $\begin{array} { | c | c | c | c | } \hline \text { Price } & \text { Buyer 1Qd 1 } & \text { Buyer 2 Qd 2 } & \text { Buyer 3 Qd 3 } \\\hline \$ 6 & 7 & 4 & 6 \\\hline 5 & 9 & 7 & 8 \\\hline 4 & 15 & 10 & 12 \\\hline 3 & 21 & 15 & 16 \\\hline\end{array}$ At a price of $6, the weekly market quantity demanded for hamburger is

Data from the registrar's office at Gigantic State University indicate that over the past 20 years tuition and enrollment have both increased. From this information we can conclude that

In the following question you are asked to determine, other things equal, the effects of a given change in a determinant of demand or supply for product X upon (1) the demand (D) for, or supply (S) Of, X; (2) the equilibrium price (P) of X; and (3) the equilibrium quantity (Q) of X. An increase in the price of a product that is a close substitute for X will

Attaining "allocative efficiency" means that

Refer to the diagram, which shows demand and supply conditions in the competitive market for product X. A shift in the demand curve from D0 to D1 might be caused by a(n)

Sometimes, we observe cases where the price of a product rose and the quantity bought by buyers also increased. Such cases occur due to a violation of the

$\begin{array} { | c | c | c | } \hline \text { Price Per Unit } & \text { Quantity Demanded Per Year } & \text { Quantity Supplied Per Year } \\\hline \$ 5 & 2,000 & 0 \\\hline 10 & 1,800 & 300 \\\hline 15 & 1,600 & 600 \\\hline 20 & 1,400 & 900 \\\hline 25 & 1,200 & 1,200 \\\hline 30 & 1,000 & 1,500 \\\hline\end{array}$ Refer to the above table. A surplus of 500 units will occur when the price is

$\begin{array} { | c | r | c | } \hline \text { Quantity Demanded } & \text { Price } & \text { Quantity Supplied } \\\hline 52 & \$ 50 & 73 \\\hline 62 & 45 & 62 \\\hline 72 & 40 & 51 \\\hline 82 & 35 & 42 \\\hline 92 & 30 & 33 \\\hline\end{array}$ In this market, economists would call a government-set maximum price of $40 a

Allocative efficiency refers to

(Consider This) Surge prices

When economists describe "a market," they mean

(Advanced analysis) The demand for commodity X is represented by the equation P = 100 - 2Q and supply by the equation P = 10 + 4Q. If demand changes from P = 100 - 2Q to P = 130 - Q, the new Equilibrium quantity is

If an effective ceiling price is placed on hamburgers, then

An increase in the demand for online streaming music indicates that more is