Question 1

During a national recession,we see the income in the economy decrease and the majority of stock prices decline (stock prices reflect the value of a company and are directly related to its profits).A few stock prices actually increase during a recessionary time.Using the information regarding supply and demand,explain why some stock prices rise during a recession.

Accepted Answer

During a recession,incomes largely go do...

Question 2

Old Navy stocks more Bermuda shorts during the summer months than in the winter months.The resulting shift in supply explains

Accepted Answer

A)   the change in technology.
B)   the change in income.
C)   price expectations.
D)   the change in input cost.
E)   the number of firms in a market.F) A) and C)
G) None of the above

Question 3

Leading economic indicators suggest that incomes will be going up next year.In response to these reports,companies are forecasting increased prices for future sales of their goods.As a result of these increases,the supply curve will

Accepted Answer

A)   shift to the right,causing the equilibrium price to decrease.
B)   remain the same,but the equilibrium price will increase.
C)   remain the same,but the equilibrium price will decrease.
D)   shift to the right,causing the equilibrium price to increase.
E)   shift to the left,causing the equilibrium price to increase.F) A) and D)
G) A) and C)

Question 4

With no barriers to entry or exit and when firms in a market are operating at a loss,we can expect other firms to exit,causing the ________ curve to shift to the ________ and making the equilibrium price ________ and the equilibrium quantity ________.

Accepted Answer

A)   demand; right; increase; increase
B)   demand; left; decrease; decrease
C)   supply; right; decrease; increase
D)   supply; left; increase; increase
E)   supply; left; increase; decreaseF) A) and D)
G) C) and E)

Question 5

A change in quantity supplied

Accepted Answer

A)   is represented by a shift in the supply curve.
B)   is represented by a movement along the supply curve.
C)   happens only when the price increases.
D)   happens only when the price decreases.
E)   is positive if the price of the good decreases.F) C) and D)
G) B) and D)

Question 6

Assume that the price of rubber increased at the same time that Michael Jordan,arguably the best NBA basketball player of all time,became famous.What do you expect to happen to the equilibrium price and equilibrium quantity of the basketball shoes that are promoted by Michael Jordan?

Accepted Answer

A)   Equilibrium price will go up and equilibrium quantity will go down.
B)   Equilibrium price will go up and equilibrium quantity will go up.
C)   Equilibrium price will go down and equilibrium quantity will be indeterminate.
D)   Equilibrium price will go down and equilibrium quantity will go up.
E)   Equilibrium price will go up and equilibrium quantity will be indeterminate.F) D) and E)
G) B) and E)

Question 7

Refer to the following table to answer the following questions.
 
-If the price of this good is $2.00,there would be a ________ of ________ units.

Accepted Answer

A)   shortage; 20
B)   surplus; 50
C)   shortage; 30
D)   surplus; 30
E)   surplus; 20F) A) and B)
G) A) and C)

Question 8

When supply shifts right and demand shifts left,

Accepted Answer

A)   the equilibrium price always rises.
B)   the equilibrium price always falls.
C)   the equilibrium quantity always falls.
D)   the equilibrium quantity always rises.
E)   the equilibrium price is indeterminate.F) A) and E)
G) A) and B)

Question 9

The price of Good X increases by 25 percent,causing the quantity consumed of Good Y to decrease by 10 percent.If everything else is held constant in the economy,we can say with certainty that Good X and Good Y are

Accepted Answer

A)   substitutes.
B)   inferior.
C)   complements.
D)   normal.
E)   unrelated.F) B) and D)
G) B) and C)

Question 10

The equilibrium price of teddy bears is $5.A study comes out that says owning a teddy bear causes you to earn a lower salary.If all other factors are held constant,which of the following scenarios could happen?

Accepted Answer

A)   The price of teddy bears increases to $7 because of a supply shift.
B)   The price of teddy bears decreases to $4 because of a supply shift.
C)   The price of teddy bears decreases to $4 because of a demand shift.
D)   The price of teddy bears increases to $7 because of a demand shift.
E)   The price of teddy bears increases to $7 because of both a demand shift and a supply shift.F) A) and D)
G) A) and C)

Question 11

The government offers numerous educational subsidies through grants and low-cost equipment to schools.They also provide a lot of incentives to go to school.Because of this,we expect that the equilibrium price of education will ________ and the equilibrium quantity of students will ________.

Accepted Answer

A)   be indeterminate; go up
B)   go up; go up
C)   go down; be indeterminate
D)   be indeterminate; go down
E)   go up; be indeterminateF) A) and E)
G) C) and D)

Question 12

We are given the following supply schedule:

a.Graph the information from the supply schedule. Be sure to label everything.
b. Now graph the following supply schedule:
 
c..What happened to the supply curve?
d. List five things that could make the supply curve reflect your answer in part c.

Accepted Answer

a.

b.

c.The supply curve shifted t...

Question 13

Using a supply and demand graph,show what happens to the equilibrium price and quantity for the following goods if,holding all else constant,income increases.
a.a normal good
b.an inferior good

Accepted Answer

The answer of Using a supply and demand graph,show what...

Question 14

When both supply and demand decrease,the equilibrium price ________ and equilibrium quantity ________.

Accepted Answer

A)   increases; increases
B)   is indeterminate; increases
C)   decreases; is indeterminate
D)   increases; is indeterminate
E)   is indeterminate; decreasesF) B) and C)
G) A) and B)

Question 15

What would we expect to happen to the price of bagels if the price of flour decreased and the price of cream cheese decreased?

Accepted Answer

A)   The equilibrium price of bagels will be indeterminate and the equilibrium quantity will go up.
B)   The equilibrium price will go up and the equilibrium quantity will go up.
C)   The equilibrium price will go down and the equilibrium quantity will be indeterminate.
D)   The equilibrium price will be indeterminate and the equilibrium quantity will go down.
E)   The equilibrium price will go up and the equilibrium quantity will be indeterminate.F) B) and D)
G) A) and E)

Question 16

Assume there are 100 suppliers of widgets in the widget market.Half of these suppliers supply 35 widgets to the market,a quarter of these suppliers supply 40 widgets to the market,and a quarter of these suppliers supply 50 widgets to the market.What is the market supply for widgets?

Accepted Answer

A)   100
B)   125
C)   400
D)   4,000
E)   1,750F) B) and C)
G) A) and E)

Question 17

The government recently imposed a number of regulations on companies that will make it more expensive for companies to hire workers.What consequence will this have on market?

Accepted Answer

A)   These regulations raise the cost of labor and shift supply to the left.
B)   These regulations raise the cost of labor and shift supply to the right.
C)   These regulations raise the cost of labor and cause a rightward movement along the supply curve.
D)   These regulations raise the cost of labor and cause a leftward movement along the supply curve.
E)   These regulations will not affect the supply curve.F) A) and E)
G) C) and D)

Question 18

At the price of $3 a pound of pork,Jason buys 8 pounds of pork and Noelle buys 10 pounds of pork.When the price rises to $5 a pound,Jason buys 5 pounds of pork and Noelle buys 7 pounds of pork.What is the market demand at $5?

Accepted Answer

A)   5
B)   7
C)   25
D)   12
E)   18F) C) and D)
G) A) and E)

Question 19

Kimberly's sister would like to start a business with her brother selling simple T-shirts that are green in color at all stores in the area.Her brother disagrees and thinks that the shirts should have a special logo on them and should be sold only at specific stores.As the deciding vote,what should Kimberly choose and why?

Accepted Answer

A)   selling green T-shirts because prices will be higher as the number of stores increases
B)   selling green T-shirts because prices will be higher as the shirt becomes more commonplace
C)   selling shirts with a special logo because prices will be higher as the shirts becomes more unique
D)   selling shirts with a special logo because prices will be higher as the shirts are sold in fewer stores
E)   both C and DF) None of the above
G) C) and D)

Question 20

When both supply and demand shift to the left,the equilibrium

Accepted Answer

A)   price always rises.
B)   price always falls.
C)   quantity always falls.
D)   quantity always rises.
E)   quantity is indeterminate.F) A) and B)
G) C) and D)

Exam 3: The Market at Work: Supply and Demand

Using a supply and demand graph,show what happens to the equilibrium price and quantity for the following goods if,holding all else constant,income increases. a.a normal good b.an inferior good

Correct Answer
verified

At the price of $3 a pound of pork,Jason buys 8 pounds of pork and Noelle buys 10 pounds of pork.When the price rises to $5 a pound,Jason buys 5 pounds of pork and Noelle buys 7 pounds of pork.What is the market demand at $5?

Correct Answer
verified

What would we expect to happen to the price of bagels if the price of flour decreased and the price of cream cheese decreased?

Correct Answer
verified

We are given the following supply schedule: a.Graph the information from the supply schedule. Be sure to label everything. b. Now graph the following supply schedule: c..What happened to the supply curve? d. List five things that could make the supply curve reflect your answer in part c.

Correct Answer
verified
a.

b.

c.The supply curve shifted t...
View Answer

A change in quantity supplied

Correct Answer
verified

The price of Good X increases by 25 percent,causing the quantity consumed of Good Y to decrease by 10 percent.If everything else is held constant in the economy,we can say with certainty that Good X and Good Y are

Correct Answer
verified

Leading economic indicators suggest that incomes will be going up next year.In response to these reports,companies are forecasting increased prices for future sales of their goods.As a result of these increases,the supply curve will

Correct Answer
verified

Refer to the following table to answer the following questions. -If the price of this good is $2.00,there would be a of units.

Correct Answer
verified

When both supply and demand shift to the left,the equilibrium

Correct Answer
verified

Assume there are 100 suppliers of widgets in the widget market.Half of these suppliers supply 35 widgets to the market,a quarter of these suppliers supply 40 widgets to the market,and a quarter of these suppliers supply 50 widgets to the market.What is the market supply for widgets?

Correct Answer
verified

When both supply and demand decrease,the equilibrium price and equilibrium quantity .

Correct Answer
verified

Correct Answer
verified

With no barriers to entry or exit and when firms in a market are operating at a loss,we can expect other firms to exit,causing the curve to shift to the and making the equilibrium price and the equilibrium quantity .

Correct Answer
verified

Old Navy stocks more Bermuda shorts during the summer months than in the winter months.The resulting shift in supply explains

Correct Answer
verified

Assume that the price of rubber increased at the same time that Michael Jordan,arguably the best NBA basketball player of all time,became famous.What do you expect to happen to the equilibrium price and equilibrium quantity of the basketball shoes that are promoted by Michael Jordan?

Correct Answer
verified

When supply shifts right and demand shifts left,

Correct Answer
verified

The equilibrium price of teddy bears is $5.A study comes out that says owning a teddy bear causes you to earn a lower salary.If all other factors are held constant,which of the following scenarios could happen?

Correct Answer
verified

The government offers numerous educational subsidies through grants and low-cost equipment to schools.They also provide a lot of incentives to go to school.Because of this,we expect that the equilibrium price of education will and the equilibrium quantity of students will .

Correct Answer
verified

The government recently imposed a number of regulations on companies that will make it more expensive for companies to hire workers.What consequence will this have on market?

Correct Answer
verified

Correct Answer
verified
During a recession,incomes largely go do...
View Answer

Exam 3: The Market at Work: Supply and Demand

Using a supply and demand graph,show what happens to the equilibrium price and quantity for the following goods if,holding all else constant,income increases. a.a normal good b.an inferior good

Correct AnswerverifiedShow Answer

At the price of $3 a pound of pork,Jason buys 8 pounds of pork and Noelle buys 10 pounds of pork.When the price rises to $5 a pound,Jason buys 5 pounds of pork and Noelle buys 7 pounds of pork.What is the market demand at $5?

Correct AnswerverifiedShow Answer

What would we expect to happen to the price of bagels if the price of flour decreased and the price of cream cheese decreased?

Correct AnswerverifiedShow Answer

We are given the following supply schedule: a.Graph the information from the supply schedule. Be sure to label everything. b. Now graph the following supply schedule: c..What happened to the supply curve? d. List five things that could make the supply curve reflect your answer in part c.

Correct Answerverifieda. b. c.The supply curve shifted t...View AnswerShow Answer

A change in quantity supplied

Correct AnswerverifiedShow Answer

The price of Good X increases by 25 percent,causing the quantity consumed of Good Y to decrease by 10 percent.If everything else is held constant in the economy,we can say with certainty that Good X and Good Y are

Correct AnswerverifiedShow Answer

Leading economic indicators suggest that incomes will be going up next year.In response to these reports,companies are forecasting increased prices for future sales of their goods.As a result of these increases,the supply curve will

Correct AnswerverifiedShow Answer

Refer to the following table to answer the following questions. -If the price of this good is $2.00,there would be a ________ of ________ units.

Correct AnswerverifiedShow Answer

When both supply and demand shift to the left,the equilibrium

Correct AnswerverifiedShow Answer

Assume there are 100 suppliers of widgets in the widget market.Half of these suppliers supply 35 widgets to the market,a quarter of these suppliers supply 40 widgets to the market,and a quarter of these suppliers supply 50 widgets to the market.What is the market supply for widgets?

Correct AnswerverifiedShow Answer

When both supply and demand decrease,the equilibrium price ________ and equilibrium quantity ________.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

With no barriers to entry or exit and when firms in a market are operating at a loss,we can expect other firms to exit,causing the ________ curve to shift to the ________ and making the equilibrium price ________ and the equilibrium quantity ________.

Correct AnswerverifiedShow Answer

Old Navy stocks more Bermuda shorts during the summer months than in the winter months.The resulting shift in supply explains

Correct AnswerverifiedShow Answer

Assume that the price of rubber increased at the same time that Michael Jordan,arguably the best NBA basketball player of all time,became famous.What do you expect to happen to the equilibrium price and equilibrium quantity of the basketball shoes that are promoted by Michael Jordan?

Correct AnswerverifiedShow Answer

When supply shifts right and demand shifts left,

Correct AnswerverifiedShow Answer

The equilibrium price of teddy bears is $5.A study comes out that says owning a teddy bear causes you to earn a lower salary.If all other factors are held constant,which of the following scenarios could happen?

Correct AnswerverifiedShow Answer

The government offers numerous educational subsidies through grants and low-cost equipment to schools.They also provide a lot of incentives to go to school.Because of this,we expect that the equilibrium price of education will ________ and the equilibrium quantity of students will ________.

Correct AnswerverifiedShow Answer

The government recently imposed a number of regulations on companies that will make it more expensive for companies to hire workers.What consequence will this have on market?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedDuring a recession,incomes largely go do...View AnswerShow Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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a.

b.

c.The supply curve shifted t...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
verified

Refer to the following table to answer the following questions. -If the price of this good is $2.00,there would be a of units.

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

When both supply and demand decrease,the equilibrium price and equilibrium quantity .

Correct Answer
verified

Correct Answer
verified

With no barriers to entry or exit and when firms in a market are operating at a loss,we can expect other firms to exit,causing the curve to shift to the and making the equilibrium price and the equilibrium quantity .

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

The government offers numerous educational subsidies through grants and low-cost equipment to schools.They also provide a lot of incentives to go to school.Because of this,we expect that the equilibrium price of education will and the equilibrium quantity of students will .

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
During a recession,incomes largely go do...
View Answer