Micro: Market Demand Quiz
Which of the following will not cause the demand for product K to change? - a change in the price of close-substitute product J - an increase in consumer incomes - a change in the price of K - a change in consumer tastes
a change in the price of K
If the demand for product C shifts to the right, this might be caused by: - an increase in income if C is an inferior good - a decrease in income if C is a normal good - a decrease in the price of a product that is a close substitute for C - a decrease in the price of a product that is complementary to C
a decrease in the price of a product that is complementary to C
If two goods are complements: - they are consumed independently - an increase in the price of one will increase the demand for the other - a decrease in the price of one will increase the demand for the other - they are necessarily inferior goods
a decrease in the price of one will increase the demand for the other
Which of the following would not shift the demand curve for beef? - a widely publicized study that indicates beef increases one's cholesterol - a reduction in the price of cattle feed - an effective advertising campaign by pork producers - a change in the incomes of beef consumers
a reduction in the price of cattle feed
An economist of a bicycle company predicts that (other things equal) a rise in consumer incomes will increase the demand for bicycles. This prediction is based on the assumption that: - there are many goods that are substitutes for bicycles - there are many goods that are complementary to bicycles - there are few goods that are substitutes for bicycles - bicycles are normal goods
bicycles are normal goods
A price increase will reduce the amount of a good demanded because: - demand curves are upsloping - the higher price means that real incomes have risen - consumers seek substitutes for that good that is more expensive - consumers substitute relatively high-priced goods for relatively low-priced goods
consumers seek substitutes for that good that is more expensive
If X is a normal good, and increase in income will shift the: - supply curve for X to the left - supply curve for X to the right - demand curve for X to the left - demand curve for X to the right
demand curve for X to the right
The law of demand states that: - price and quantity demanded are inversely related - the larger the number of buyers in a market, the lower will be product price. - price and quantity demanded are directly related - consumers will buy more of a product at high prices than at low prices
price and quantity demanded are inversely related
For a given demand relationship, the most important factor in determining a consumer's planned purchase is: - product price - consumer income - the prices of related goods - consumer tastes
product price
A demand curve: - shows the relationship between price and quantity supplied - reveals planned purchases at various prices - graphs as an upsloping line - shows the relationship between income and spending
reveals planned purchases at various prices
If the price of K declines, the demand curve fore the complementary product J will: - shift to the left - decrease - shift to the right - remain unchanged
shift to the right
If the price of product L increases, the demand curve for close-substitute product J will: - shift downward toward the horizontal axis - shift to the left - shift to the right - remain unchanged
shift to the right
Other things equal, which of the following might shift the demand curve for gasoline to the left? - the discovery of vast new oil reserves in Montana - the development of a low-cost electric automobile - an increase in the price of train and air transportation - a large decline in the price of automobiles
the development of a low-cost electric automobile
The income and substitution effects explain: - the upward slopping supply curve - the downward sloping demand curve - demand curve changes - all of the above
the downward sloping demand curve
When the price of a product falls, the purchasing power of our money income rises and thus permits consumers to purchase more of the product. This statement describes: - an inferior good - the rationing function of prices - the substitution effect - the income effect
the income effect
