Chapters 1-6, 14 Test Questions

When new technology for producing computers is used by manufacturers, the supply of computers increases.

True

Teenagers demand more soda than other age groups. If the number of teenagers increases, everything else remaining the same: a. market demand for soda increases b. market demand for soda decreases c. market demand for soda does not change d. there is a movement along the market demand curve for soda e. none of the above answers is correct because the effect on the demand depends on whether the supply curve shifts

A

The number of buyers if sport utility vehicles, SUVs, decreases sharply. So the: a. demand curve for SUVs shifts leftward b. demand curve for SUVs shifts rightward c. demand curve fir SUVs does not shift nor is there a movement along the demand curve d. demand curve for SUVs does not shift but there is a movement downward along it e. the supply curve for SUVs shifts rightward

A

The shift of the demand curve for pizza illustrated in Figure 4.3 could be the result of: a. a rise in income if pizza is a normal good b. a fall in the price of fried chicken, a substitute for pizza c. consumers coming to believe that pizza is unhealthy d. the belief that pizza will fall in price next month e. a fall in the price of a pizza

A

Other things remaining the same, the quantity of a good or service demanded will increase if the price of the good or service: a. rises b. falls c. does not change d. rises or does not change e. rises or falls

B

The shift of the demand curve for pizza illustrated in Figure 4.3 could be the result of: a. a rise in income if pizza is an inferior good b. a fall in price of soda, a complement for pizza c. a decrease in the number of college students if college students eat more pizza than other age groups d. a rise in the price of a pizza e. a fall in the price of a pizza

B

One reason the demand for laptop computers might increase is a a. fall in the price of a laptop computer b. fall in the prices of a desktop computer c. a change in preferences as laptops have become more portable, with faster processors and larger hard drives d. poor quality performances record for laptop computers e. a decrease in income if laptops are a normal good

C

If the price of a DVD falls, i. the demand curve for DVDs shifts rightward ii. the demand curve for DVDs will not shift iii. there is a movement along the demand curve for DVDs a. i only b. ii only c. iii only d. ii and iii e. i and iii

D

Pizza and tacos are substitutes and the price of a pizza increases. Which of the following correctly indicates what happens? a. the demand for pizza decreases and the demand for tacos increases b. the demand for both goods decreases c. the quantity of tacos demanded increases and the quantity of pizza demanded decreases d. the quantity of pizza demanded decreases and the quantity of tacos demanded increases e. the demand for each decreases because both are normal goods

D

The "law of demand" indicates that if the University of Maine increases its tuition, all other things remaining the same: a. the demand for classes will decrease b. the demand for classes will increase c. the quantity of classes demanded will increase d. the quantity of classes demanded will decrease e. both the demand for and the quantity of classes demanded will decrease

D

When moving along a demand curve, which of the following changes? a. the consumers' incomes b. the prices of other goods c. the number of buyers d. the price of the good e. the consumers' preferences

D

A rise in the price of computer increases the demand for computers because a computer is a normal good. (True or False)

False

As summer comes to an end and winter sets in, the demand for and supply of hamburger buns decrease. The price of a hamburger bun definitely remains the same.

False

If people's incomes fall and all other influences on buying plans remain the same, the demand for computers will decrease and there will be a movement along the demand curve. (True or False)

False

If the quantity of ice cream demanded at each price increases, there is a movement along the demand curve for ice cream. (True or False)

False

If the wage rate paid to chefs rises and all other influences on selling plans remain the same, the supply of restaurants meals will increase.

False

The law of demand states that other things remaining the same, if the price of the good rises, the quantity demanded of that good increases. (True or False)

False

The law of supply and demand states that other things remaining the same, if the price of a good rises, the supply of the good increases.

False

The supply of a good will increase and there will be a movement up along the supply curve of the good if the price of one of its substitutes in production falls.

False

When the demand for skateboards decreases and the supply of skateboards remains unchanged, the quantity supplied of skateboards decreases as the price rises.

False

If the price of coffee is expected to rise next month, the supply of coffee this month will decrease.

True

The number of buyers of grapefruit juice increases and at the same time severe frost decreases the supply of grapefruit juice. The price of grapefruit juice will rise.

True

When Sue's income increases, her demand for movies increases. For Sue, movies are a normal good. (True or False)

True

Which of the following is the best explanation for why the price of gasoline increases during the summer months?

There is increased driving by families going on vacation

Gasoline refiners expect the price of oil to fall net month. If the supply of oil does not change, the equilibrium price of oil today falls and the equilibrium quantity today decreases.

True

If the price of asparagus is below the equilibrium price, there is a shortage of asparagus and the price of asparagus will rise until the shortage disappears.

True

A rise in the price of a substitute in production for a good leads to

a decrease in the supply of that good

One reason supply curves have an upward slope is because...

a higher price brings a greater profit, so firms want to sell more of that good

The shift of the supply curve of pizza illustrated in Figure 4.8 could be the result of

an increase in the number of firms producing pizza

Which of the following indicates that the law of supply applies to makers of soda?

an increase in the price of a soda leads to an increase in the quantity of soda supplied

The shift of the supply curve of pizza illustrated in in Figure 4.8 could be the result of

an increase in the productivity of the firms producing pizza

The price of leather used to produce shoes rises, so the supply of shoes ____ and the supply curve of shoes ______.

decreases; shifts leftwards

The number of people looking to buy ceiling fans increases, so there is an increase in the...

demand for ceiling fans and a rise in the price of a ceiling fan

Candy makers accurately anticipate the increase in demand for candy for Halloween so that the supply of candy and the demand for candy increase the same amount. As a result, the price of candy ____ and the quantity of candy ____.

does not change; increases

The technology associated with manufacturing computers has advanced enormously. This change has led to the price of a computer ____ and the quantity _____.

falling; increasing

The market supply curve is the _______ of the ________

horizontal sum; individual supply curves

Which of the following is correct? i. A surplus puts downward pressure on the price of a good ii. A shortage puts upward pressure on the price of a good iii. there is no surplus or shortage at equilibrium

i,ii,and iii

During 2011 the supply of gasoline decreased while at the same time the demand for gasoline increased. If the magnitude of the increase in demand was greater than the magnitude of the decrease in supply, then the equilibrium price of gasoline _____ and the equilibrium quantity _____.

increased; increased

The equilibrium price of a good occurs if the...

quantity of the good demanded equals the quantity of the supplied

Suppose that the price of lettuce use to produce tacos increases. This change means that the equilibrium price of a taco _____ and the equilibrium quantity ______.

rises; decreases

The quantity supplied of a good, service, or resource is ___________ during a specified period and at a specified price.

the amount that people are able and willing to sell

An increase in the productivity of producing jeans results in

the supply of jeans increasing

If the costs to produce pizza increase, which will occur?

the supply of pizza will decrease