ECON CH 4,6

A supply schedule is a table that shows the relationship between A) price and quantity supplied. B) input costs and quantity supplied. C) quantity demanded and quantity supplied. D) profit and quantity supplied.

A

If the demand for a good falls when income falls, then the good is called A) a normal good. B) a regular good. C) an ordinary good. D) an inferior good.

A

A baker recently has come to expect higher prices for bread in the near future. We would expect A) the baker to supply more bread now than she was supplying previously. B) the baker to supply less bread now than she was supplying previously. C) the demand for bread to fall. D) no change in the baker's current supply of bread; instead, future supply will be affected.

B

At the equilibrium price, the quantity of the good that buyers are willing and able to buy A) is greater than the quantity that sellers are willing and able to sell. B) exactly equals the quantity that sellers are willing and able to sell. C) is less than the quantity that sellers are willing and able to sell. D) could be greater or less than the quantity that sellers are willing and able to sell.

B

If a nonbinding price floor is imposed on a market, then the A) quantity sold in the market will decrease. B) quantity sold in the market will stay the same. C) price in the market will increase. D) price in the market will decrease

B

Refer to Figure 4-1. The movement from point A to point B on the graph is caused by A) an increase in price. B) a decrease in price. C) a decrease in the price of a substitute good. D) an increase in income.

B

Refer to Figure 4-4. The movement from point A to point B on the graph is caused by A) a decrease in the price of the good. B) an increase in the price of the good. C) an advance in production technology. D) a decrease in input prices.

B

The law of supply states that, other things equal, when the price of a good A) falls, the supply of the good rises. B) rises, the quantity supplied of the good rises. C) rises, the supply of the good falls. D) falls, the quantity supplied of the good rises.

B

A likely example of complementary goods for most people would be A) apple juice and orange juice. B)tennis balls and basketballs. C)coffee and sugar. D) butter and margarine.

C

Currently you purchase ten frozen pizza per month. You will graduate from college in December, and you will start a new job in January. You have no plans to purchase frozen pizzas in January. For you, frozen pizzas are A) a substitute good. B) a normal good. C) an inferior good. D) a complementary good.

C

Refer to Figure 4-6. The shift from S' to S is called A) an increase in supply. B) a decrease in quantity supplied. C) a decrease in supply. D) an increase in quantity supplied.

C

Refer to Figure 4-7. At a price of $15, there would be a A) surplus of 400 units. B) surplus of 200 units. C) shortage of 400 units. D) shortage of 200 units.

C

Refer to Figure 4-7. Equilibrium price and quantity are, respectively, A) $30 and 500 units. B) $20 and 300 units. C) $25 and 400 units. D) $15 and 200 units.

C

Suppose the equilibrium price of a physical examination ("physical") by a doctor is $200, and the government imposes a price ceiling of $150 per physical. As a result of the price ceiling, the A) demand curve for physicals shifts to the right. B) supply curve for physicals shifts to the left. C) quantity demanded of physicals increases, and the quantity supplied of physicals decreases. D) number of physicals performed stays the same.

C

An increase in the price of a good will A) increase supply. B) decrease supply. C) decrease quantity supplied. D) increase quantity supplied.

D

Refer to Figure 4-1. The movement from point A to point B on the graph shows You Answered A) a decrease in demand. B) an increase in demand. C) a decrease in quantity demanded. D) an increase in quantity demanded.

D

Soup is an inferior good if the demand A) for soup falls when the price of a substitute for soup rises. B) for soup rises when the price of soup falls. C) curve for soup slopes upward. D) for soup falls when income rises.

D

The law of demand states that, other things equal, when the price of a good A) falls, the demand for the good rises. B) rises, the quantity demanded of the good rises. C) rises, the demand for the good falls. D) falls, the quantity demanded of the good rises.

D

Which of the following events would cause a movement upward and to the left along the demand curve for olives? A) The number of people who purchase olives decreases. B) Consumer income decreases, and olives are a normal good. C) The price of pickles decreases, and pickles are a substitute for olives. D) The price of olives rises.

D

Which of the following would not increase in response to a decrease in the price of ironing boards? 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) The quantity of irons supplied at each possible price of irons

D