SUPPLY AND DEMAND

According to the law of demand there is​ ________ relationship between price and quantity demanded. A. a positive B. a negative C. either a positive or negative D. a constantly changing

A negative

A maximum​ price, set by the​ government, that sellers may charge for a good is known as A. a subsidy. B. a price rationing mechanism. C. a price floor. D. a price ceiling.

A price ceiling

According to the law of​ supply, there is a A. positive relationship between price and the quantity of a good supplied. B. positive relationship between price and the change in supply. C. negative relationship between price and the change in supply. D. negative relationship between price and the quantity of a good supplied.

A. positive relationship between price and the quantity of a good supplied.

A frozen food manufacturer can produce either pizzas or calzones. As the result of an increase in the price of​ calzones, the firm produces more calzones and fewer pizzas. An economist would explain this by saying A. there has been an increase in the quantity supplied of calzones and a decrease in the supply of pizza. B. the supply of calzones increased and the supply of pizzas decreased. C. there has been an increase in the quantity supplied of calzones and a decrease in the quantity supplied of pizzas. D. the supply of calzones increased and the quantity supplied of pizza decreased.

A. there has been an increase in the quantity supplied of calzones and a decrease in the supply of pizza.

The​ "law of​ demand" implies that A. as prices​ rise, demand increases. B. as prices​ rise, quantity demanded increases. C. as prices​ fall, quantity demanded increases. D. as prices​ fall, demand increases.

As prices fall, quantity demanded increases

Which of the following will not cause a shift in the demand curve for​ DVDs? A. a change in income B. a change in the price of DVDs C. a change in wealth D. a change in the price of Bluminus−ray discs

B. a change in the price of DVDs

If the price of chili​ increases, there will be​ ________ of chili cheese fries. A. an increase in the supply B. a decrease in the supply C. a decrease in the quantity supplied D. an increase in the quantity supplied

B. a decrease in the supply of

The price of hard drives used in the manufacturing of laptop computers has risen. This will lead to​ ________ laptop computers. A. an increase in the supply of B. a decrease in the supply of C. a decrease in the quantity supplied of D. an increase in the quantity supplied of

B. a decrease in the supply of

If the price of spinach​ decreases, there will be​ ________ of spinach enchiladas. A. a decrease in the quantity supplied B. an increase in the supply C. an increase in the quantity supplied D. a decrease in the supply

B. an increase in the supply

Demand curves are derived while holding constant A. only income and tastes. B. ​income, tastes, and the prices of other goods. C. only tastes and the prices of other goods. D. ​income, tastes, and the price of the good.

B. ​income, tastes, and the prices of other goods.

A decrease in demand for cameras would likely be caused by A. a decrease in the price of cameras. B. an increase in the price of cameras. C. an increase in the price of a complementary good. D. an increase in the price of a substitute good.

C. an increase in the price of a complementary good.

During an economic downturn when consumer income​ falls, the demand for tacos increases and the demand for sushi decreases. This implies that tacos A. are an economic bad and sushi is an economic good. B. are a normal good and sushi is an inferior good. C. are an inferior good and sushi is a normal good. D. and sushi are complements.

C. are an inferior good and sushi is a normal good.

A change in income leads to a​ ________ that causes a​ ________. A. change in quantity​ demanded; shift of the demand curve B. change in​ demand; movement along the demand curve C. change in​ demand; shift of the demand curve D. change in quantity​ demanded; movement along the demand curve

C. change in​ demand; shift of the demand curve

In an output market A. households earn income. B. firms purchase resources. C. consumers purchase products. D. ​land, labor, and capital may be exchanged.

C. consumers purchase products.

Michael Dell was the first individual who sold computers by mail order. The company founded by Dell is now one of the largest and most successful computer companies in the United States. Michael Dell would be classified as​ a(n) A. opportunist. B. socialist. C. entrepreneur. D. monopolist.

C. entrepreneur.

The quantity demanded of Pepsi has decreased. The best explanation for this is that A. the price of Cocaminus−Cola has increased. B. Pepsi consumers had an increase in income. C. the price of Pepsi has increased. D. ​Pepsi's advertising is not as effective as in the past.

C. the price of Pepsi has increased.

Why do firms engage in the activity of​ production? A. to participate in the circular flow B. to help society advance technologically C. to acquire profits D. to develop a supply schedule

C. to acquire profits

Among the factors of production are A. wages. B. capital. C. income. D. all of the above

Capital

74,

Check

82,

Check

Check 28

Check

Check 30,31,32,33,34,35,

Check

Check 48,49,50,51,

Check

Check 53,54

Check

Check 60,61,62,63,64,65,66,67,68,

Check

Check number 16,17,18,

Check

Demand for one item goes down when the price of another item goes up. These items must be A. substitutes. B. inferior goods. C. complements. D. normal goods.

Complements

In​ input, or​ factor, markets A. consumers purchase products. B. firms supply goods. C. households demand goods. D. households supply resources

D. households supply resources

The consuming units in an economy are known as A. firms. B. entrepreneurs. C. factors. D. households.

D. households.

Firms are organizations that A. demand consumer outputs. B. take advantage of the public. C. transform outputs into inputs. D. transform resources into products.

D. transform resources into products.

A decrease in demand for a product will cause the price of the product to fall and supply of the product to decrease. True False

F

A surplus exists when there is excess demand in a market. T or f

F

A change in the price of a good leads to a change in the demand of the good. True False

False

An increase in the wage rate of diamond cutters will increase the supply of cut diamonds. True False

False

Demand is determined by how much suppliers are willing and able to produce. True False

False

Factors of production are traded in the product market T or f

False

If iPods and iTunes are​ complements, then a decrease in the price of iPods will result in a decrease in the demand for iTunes. True False

False

Inferior goods are also known as substitute goods. True False

False

Labor is demanded by firms in an output market T or f

False

In​ factor, or​ input, markets A. households demand goods. B. consumers purchase products. C. firms demand resources. D. firms supply goods.

Firms demand resources

Which of the following is held constant along the demand​ curve? A. price of the good B. quantity C. income D. both A and B

Income

In response to news reports that taking aspirin daily can reduce an​ individual's risk of a heart​ attack, there will most likely be​ a(n) A. increase in the quantity demanded of aspirin. B. increase in the supply of aspirin. C. decrease in the supply of aspirin. D. increase in the demand for aspirin.

Increase in the Demand for aspirin

When the decrease in the price of one good causes the demand for another good to​ decrease, the goods are A. complements. B. substitutes. C. normal. D. inferior.

Normal

If the demand for coffee decreases as income​ decreases, coffee is​ a(n) A. substitute good. B. inferior good. C. normal good. D. complementary good.

Normal good

according to the law of​ demand, quantity demanded decreases as​ ________, ceteris paribus. A. demand decreases B. demand increases C. prices fall D. prices rise

Prices rise

A technological advance in the production of digital video recorders will cause them to become less expensive. True False

True

An increase in the wage rate of steel workers will reduce the supply of steel. True False

True

Economists would classify the Boston Symphony Orchestra as a firm. T or F

True

Households are paid income for the resources they supply in an input market T or F

True

With an effective price​ ceiling, quantity demanded exceeds quantity supplied. T or f

True

Which of the following will definitely occur when there is a simultaneous decrease in demand and a decrease in​ supply? A. an increase in equilibrium quantity B. an increase in equilibrium price C. a decrease in equilibrium quantity D. a decrease in equilibrium price

a decrease in equilibrium quantity

Which of the following will definitely occur when there is a simultaneous increase in demand and an increase in​ supply? A. a decrease in equilibrium price B. an increase in equilibrium quantity C. an increase in equilibrium price D. a decrease in equilibrium quantity

an increase in equilibrium quantity

A movement along the demand curve to the left may be caused by a A. fall in the price of inputs. B. decrease in supply. C. fall in the number of substitute goods. D. rise in income.

decrease in supply.

If the market for tires is unregulated and is presently characterized by excess​ supply, you can accurately predict that price will A. ​decrease, the quantity demanded will​ rise, and the quantity supplied will fall. B. ​decrease, the quantity demanded will​ fall, and the quantity supplied will rise. C. ​increase, the quantity demanded will​ rise, and the quantity supplied will fall. D. ​increase, the quantity demanded will​ fall, and the quantity supplied will rise.

decrease, the quantity demanded will​ rise, and the quantity supplied will fall.

A decrease in the price of a good or service leads to​ a(n) ________ that leads to​ a(n) ________. A. increase in quantity​ demanded; movement along the demand curve B. decrease in quantity​ demanded; shift of the demand curve C. increase in​ demand; shift of the demand curve D. decrease in​ demand; movement along the demand curve

increase in quantity​ demanded; movement along the demand curve

When the supply of chocolate decreases while the demand for chocolate also​ decreases, the equilibrium​ ________ of chocolate will definitely​ ________, ceteris paribus. A. ​price; increase B. ​price; decrease C. ​quantity; increase D. ​quantity; decrease

quantity; decrease

The change in the price of a good leads to a change in​ ________, which leads to a​ ________. A. quantity​ supplied; movement along a supply curve B. ​supply; shift of the supply curve C. ​supply; movement along a supply curve D. quantity​ supplied; shift of the supply curve

quantity​ supplied; movement along a supply curve

Suppose the demand for books goes down when the price of video games goes down. We can say that these two goods are A. perfect substitutes. B. unrelated goods. C. substitutes. D. complements.

Substitute

Demand for one item goes down when the price of another item goes down. These items must be A. substitutes. B. normal goods. C. inferior goods. D. complements.

Substitutes

A simultaneous decrease in both the supply of and the demand for silk boxer shorts would cause a decrease in the equilibrium quantity of silk boxer shorts. T or f

T

If price is above the​ equilibrium, then quantity supplied will be greater than quantity demanded putting downward pressure on price. T or f

T

Refer to the scenario below to answer the question that follows. Lettuce and spinach are substitutes. Lettuce and tomatoes are complements. Lettuce is a normal good. During the​ winter, about​ 20% of the lettuce crop was destroyed by flooding. As a result of the flooding during the​ winter, you would expect that A. the price of lettuce would increase and both the quantity of lettuce supplied and the quantity of lettuce demanded would increase. B. the price of lettuce would​ increase, the supply of lettuce would​ increase, and the quantity demanded of lettuce would decrease. C. the supply of lettuce would​ decrease, the price of lettuce would​ increase, and the demand for lettuce would decrease. D. the supply of lettuce would​ decrease, the price of lettuce would​ increase, and the quantity demanded of lettuce would decrease.

the supply of lettuce would​ decrease, the price of lettuce would​ increase, and the quantity demanded of lettuce would decrease.

Unseasonably warm weather in Georgia resulted in a bumper crop of peaches. Ceteris paribus A. the supply of peaches decreased and the price of peaches increased. B. the supply of peaches increased and the price of peaches decreased. C. the demand for peaches increased and the price of peaches increased. D. the demand for peaches decreased and the price of peaches decreased.

the supply of peaches increased and the price of peaches decreased.

The price of mozzarella​ cheese, which is used in making​ pizza, increases. In the market for pizza you would expect that A. the supply of pizza would increase and the price of pizza would decrease. B. the supply of pizza would decrease and the price of pizza would increase. C. the demand for pizza would decrease and the price of pizza would fall. D. the demand for pizza would increase and the price of pizza would increase

the supply of pizza would decrease and the price of pizza would increase.

If a price ceiling is set below the equilibrium​ price, A. demand will be less than supply. B. there will be a shortage. C. quantity demanded will equal quantity supplied. D. there will be a surplus.

there will be a shortage.

Equilibrium is the condition that exists A. when quantity demanded equals quantity supplied. B. when the demand curve intersects the quantity axis. C. whenever there is no government intervention in the market. D. when the demand curve intersects the price axis.

when quantity demanded equals quantity supplied.