Download Chapter 3 Demand and Supply

Chapter 3: Demand and Supply
Roger LeRoy Miller
Economics Today, Sixteenth Edition
© 2012 Pearson Addison-Wesley. All rights reserved.
The law of demand includes the statement "other
things being equal." These other things include all
of the following EXCEPT
A.
B.
C.
D.
the price of that good in the law of demand.
consumers' income.
consumers' tastes and preferences.
the number of potential buyers.
Roger LeRoy Miller
Economics Today, Sixteenth Edition
© 2012 Pearson Addison-Wesley. All rights reserved.
Refer to the figure below. Which panel
demonstrates the law of demand?
A.
B.
C.
D.
Panel A
Panel B
Panel C
Panel D
Roger LeRoy Miller
Economics Today, Sixteenth Edition
© 2012 Pearson Addison-Wesley. All rights reserved.
The law of demand implies that the demand curve
A. has a negative slope.
B. has a positive slope.
C. shifts to the right when the price of a good
increases.
D. shifts to the left when the price of a good
decreases.
Roger LeRoy Miller
Economics Today, Sixteenth Edition
© 2012 Pearson Addison-Wesley. All rights reserved.
A market demand schedule for a product indicates
that
A. as the product's price falls, consumers buy less
of the good.
B. there is a positive relationship between price
and quantity demanded.
C. as a product's price rises, consumers buy more
of the good.
D. there is a negative relationship between price
and quantity demanded.
Roger LeRoy Miller
Economics Today, Sixteenth Edition
© 2012 Pearson Addison-Wesley. All rights reserved.
Suppose a concert by Lady Gaga and a basketball
game played by the L.A. Lakers are substitutes, then
which of the following is true?
A. If the price of a ticket to a Lakers game increases,
then the demand for Lady Gaga tickets will fall.
B. If the price of a ticket to a Lakers game decreases,
the quantity of Lakers tickets demanded will
increase.
C. If the price of a ticket to a Lakers game increases,
then the demand for Lady Gaga tickets will remain
unchanged.
D. The price of a ticket to a Lakers game will always
equal the price of a ticket to a Lady Gaga concert.
Roger LeRoy Miller
Economics Today, Sixteenth Edition
© 2012 Pearson Addison-Wesley. All rights reserved.
In the figure below, when the price of Good B
increases, the result can be shown by
A.
B.
C.
D.
the movement from D1 to D2 in Graph A.
the movement from D2 to D1 in Graph A.
the movement along D0 from P1 to P2.
the movement along D0 from P2 to P1.
Roger LeRoy Miller
Economics Today, Sixteenth Edition
© 2012 Pearson Addison-Wesley. All rights reserved.
An increase in demand is represented by a
A.
B.
C.
D.
shift of the demand curve to the left.
shift of the demand curve to the right.
movement down the demand curve.
movement up the demand curve.
Roger LeRoy Miller
Economics Today, Sixteenth Edition
© 2012 Pearson Addison-Wesley. All rights reserved.
If the price of Pepsi increases, then there will be
________ of Pepsi.
A.
B.
C.
D.
a decrease in the supply
an increase in the supply
an increase in the quantity supplied
a decrease in the quantity supplied
Roger LeRoy Miller
Economics Today, Sixteenth Edition
© 2012 Pearson Addison-Wesley. All rights reserved.
If the price of oil rises, producers of oil will
A.
B.
C.
D.
increase the quantity of oil supplied.
supply less oil.
leave the amount of oil supplied unchanged.
cut the price.
Roger LeRoy Miller
Economics Today, Sixteenth Edition
© 2012 Pearson Addison-Wesley. All rights reserved.
The relationship between quantity supplied and the
price of output is such that
A. an increase in quantity will automatically lead to
a reduction in price.
B. an increase in price will lead to an increase in
quantity supplied.
C. an increase in price will produce an inward shift
in the supply curve.
D. quantity will decrease as the number of firms
increases.
Roger LeRoy Miller
Economics Today, Sixteenth Edition
© 2012 Pearson Addison-Wesley. All rights reserved.
Which one of the following statements is FALSE?
A. There is an inverse (negative) relationship
between product price and quantity supplied.
B. There is some price at which quantity supplied
of a product is zero.
C. As product price increases, producers are
willing to put more of the good on the market
for sale.
D. In order to entice producers to offer more of a
product on the market for sale, product price
must rise.
Roger LeRoy Miller
Economics Today, Sixteenth Edition
© 2012 Pearson Addison-Wesley. All rights reserved.
Which of the following causes a movement along a
supply curve?
A.
B.
C.
D.
a change in resource costs
a change in technology
a change in the price
all of the above
Roger LeRoy Miller
Economics Today, Sixteenth Edition
© 2012 Pearson Addison-Wesley. All rights reserved.
Refer to the table below. The market quantity
supplied when the price is $6 is
A.
B.
C.
D.
0
5
10
20
Roger LeRoy Miller
Economics Today, Sixteenth Edition
© 2012 Pearson Addison-Wesley. All rights reserved.
An improvement in technology in the production of
computers would
A.
B.
C.
D.
increase the demand for computers.
increase the supply of computers.
decrease the demand for computers.
decrease the supply of computers.
Roger LeRoy Miller
Economics Today, Sixteenth Edition
© 2012 Pearson Addison-Wesley. All rights reserved.
Which of the following will shift today's supply
curve to the right?
A.
B.
C.
D.
Input prices rise.
Sales taxes increase.
Prices are expected to be higher in the future.
Prices are expected to be lower in the future.
Roger LeRoy Miller
Economics Today, Sixteenth Edition
© 2012 Pearson Addison-Wesley. All rights reserved.
If the price of cotton used in making blue jeans
increases, which of the following will occur?
A. There will be a movement along an unchanged
supply curve for jeans.
B. The supply curve for jeans will shift rightward.
C. The supply curve for jeans will shift leftward.
D. There will be a rightward shift in the supply
curve for jeans, followed by a movement along
the supply curve.
Roger LeRoy Miller
Economics Today, Sixteenth Edition
© 2012 Pearson Addison-Wesley. All rights reserved.
According to the table below, at a price of $2 per
unit, which of the following would exist?
A.
B.
C.
D.
a shortage of 800 units
a surplus of 800 units
a shortage of 200 units
a shortage of 400 units
Roger LeRoy Miller
Economics Today, Sixteenth Edition
© 2012 Pearson Addison-Wesley. All rights reserved.
According to the figure below, at a price of $1 per
gallon, there would be
A.
B.
C.
D.
a shortage of 30 million gallons.
a surplus of 30 million gallons.
a shortage of 20 million gallons.
a surplus of 50 million gallons.
Roger LeRoy Miller
Economics Today, Sixteenth Edition
© 2012 Pearson Addison-Wesley. All rights reserved.
According to the table below, at a price of $8 per
unit, other things constant,
A. consumers will continue to bid prices upward.
B. there will be no tendency for the market to
approach an equilibrium.
C. a surplus of 100 units will exist.
D. a shortage of 80 units will exist.
Roger LeRoy Miller
Economics Today, Sixteenth Edition
© 2012 Pearson Addison-Wesley. All rights reserved.
Which of the following situations could generate a
shortage?
A. Demand for a good increases, resulting in a
new higher market clearing price.
B. Demand for a good decreases, resulting in a
new lower market clearing price.
C. Demand for a good increases, but the price is
not permitted to rise.
D. Demand for a good decreases, but the price is
not permitted to fall.
Roger LeRoy Miller
Economics Today, Sixteenth Edition
© 2012 Pearson Addison-Wesley. All rights reserved.