1、Microeconomics - Testbank 1 (Hubbard/OBrien)Chapter 3 Where Prices Come From: The Interaction of Demand and Supply1) Demand shows: A) the quantity of a good that buyers will buy at a given price. B) the quantities of a good that buyers will buy at all possible prices. C) the quantity of a good that
2、sellers will sell at a given price. D) the quantities of a good that sellers will sell at all possible prices. 2) When the price of a good increases: A) the demand for the good will decrease. B) the demand for the good will increase. C) the quantity demanded of the good will decrease. D) the quantit
3、y demanded of the good will increase. 3) When the price of a CD decreases: A) the demand for CDs will decrease. B) the demand for CDs will increase. C) the quantity demanded of CDs will decrease. D) the quantity demanded of CDs will increase. 4) The law of demand states that holding everything else
4、constant: A) buyers increase the quantities they buy when their incomes increase. B) there is a positive or up sloping relationship between price and quantity. C) buyers decrease the amount of a good bought when there is more in the market. D) there is an inverse or down sloping relationship between
5、 price and quantity. 5) The substitution effect results in: A) sellers substituting less expensive inputs in production. B) buyers buying more of a good because their purchasing power has increased. C) sellers producing products when input prices fall. D) buyers buying more of a relatively cheaper g
6、ood. 6) The income effect occurs when: A) buyers buy more of a good because their purchasing power has increased. B) buyers buy more of a relatively cheaper good. C) sellers produce more output because their profit has increased. D) sellers hire more workers because buyers incomes have increased. 7)
7、 If we know the individual demands of all buyers in a market, we can find market demand by: A) multiplying all the individual prices by the individual quantity demanded. B) adding all individual prices buyers will pay for each quantity. C) adding all individual quantities buyers will buy for each pr
8、ice. D) observing how much is sold in the market at the current price. 8) Which of the following is not held constant along a demand schedule or curve? A) The buyers tastes and preferences B) The buyers incomes C) The price of the product D) The buyers expectations about future prices 9) If the pric
9、e of a product increases from $12 to $15: A) the demand for the product will decrease. B) the demand for the product will increase. C) the quantity demanded for the product will decrease. D) the quantity demanded for the product will increase. 10) The phrase ceteris paribus means: A) after this, bef
10、ore that. B) seize the day. C) all else equal. D) buyer beware. 11) An increase in the demand for bananas will NOT be caused by: A) a rise in the price of apples. B) news that bananas help relieve stress in people. C) a drop in the market price of bananas. D) buyers switching to a more healthy diet.
11、 12) Which of the following pairs of goods would be an example of substitutes? A) Gasoline and automobiles B) Automobiles and motorcycles C) Cooking oil and golf balls D) Computers and printers 13) What would explain the price of gasoline being much higher in 2005 than it was in 2004, yet roughly th
12、e same amount of gasoline was bought in both years? A) The demand for gasoline does not follow the law of demand. B) The supply of gasoline stayed constant in 2004 and 2005. C) The demand for gasoline increased from 2004 to 2005. D) The demand for gasoline decreased from 2004 to 2005. 14) If last ye
13、ar the Ajax firm sold 250 sofas at $1,000 each and this year Ajax sold 500 sofas at $1,500 each, then A) Ajax increased the supply of sofas. B) the demand for sofas is up sloping. C) the demand for sofas increased. D) the quantity demanded has increased. 15) The demand for big screen TVs would fall,
14、 if big screen TVs are normal goods and: A) the market price of big screen television sets increases. B) there is a larger output of big screen TVs. C) buyers of big screen TVs incomes fall because of a recession. D) the market price of DVDs falls. 16) Normal goods are one that buyers buy: A) less o
15、f when their incomes decrease. B) during normal times. C) more of when their incomes decrease. D) a lot of throughout the year. 17) Inferior goods are: A) substandard. B) goods whose purchase is inversely related to consumer income C) goods whose purchase is directly related to consumer income. D) g
16、oods that do not work. 18) The law of demand exists because when price changes: A) the substitution and income effects work together to change quantity demanded. B) demand changes. C) supply changes. D) all of the above. 19) If tires and gasoline are compliments, then: A) an increase in the price of
17、 gasoline will reduce the consumption of tires. B) an increase in the price of gasoline will increase the consumption of tires. C) tires and gasoline consumption are unrelated. D) an increase in the price of tires will increase the consumption of gasoline. 20) When something is fashionable, economis
18、ts would say that demand would increase because: A) consumer incomes have increased. B) consumer tastes and preferences have turned favorably towards that product. C) the price of the product has increased. D) expectations of the future price has increased. 21) As the average age of the population o
19、f the United States gets older, the demand for: A) childrens toys will increase. B) health care will increase. C) retirement homes will decrease. D) motorcycles will increase. 22) A change in demand represents a _ while a change in quantity demanded is a _. A) movement along one demand curve; shift
20、to a new demand curve B) shift to a new demand curve; movement along one demand curve C) movement along one demand curve; movement along another demand curve D) shift to a new demand curve; shift to a another new demand curve 23) What would happen in the red apple market if the price of golden apple
21、s decreases? A) Nothing, they are separate and unrelated commodities. B) The quantity demanded of red apples would increase. C) The demand for red apples would increase. D) The demand for red apples would fall. 24) If the demand for a good increases when there is high unemployment, we can conclude t
22、hat the commodity is: A) a normal good. B) an inferior good. C) a good for which the law of demand does not apply. D) a luxury good. 25) If the demand for good X increases, when the price of good Y decreases, then: A) goods X and Y are inferior goods. B) goods X and Y are complement. C) goods X and
23、Y are substitutes. D) goods X and Y are normal goods. 26) If the demand for good X decreases, when the price of good Y decreases, then: A) goods X and Y are inferior goods. B) goods X and Y are complements. C) goods X and Y are substitutes. D) goods X and Y are normal goods. 27) If the cost of produ
24、cing a product increases, then: A) the quantity demanded will increase. B) the quantity supplied will increase. C) the supply of the product will decrease. D) the demand for the product will decrease. 28) The law of supply implies that: A) there is a positive or direct relationship between price and
25、 quantity supplied. B) the supply curve slopes upward. C) as the price of the product increases, the quantity supplied increases. D) all of these correctly state the law of supply. 29) An advance in technology increases supply: A) because new technology is so expensive. B) because labors or capitals
26、 productivity increases and costs of production fall. C) because buyers are willing to buy more of a product produced with the latest technology. D) all of the above. 30) As more firms produce a product: A) market supply increases. B) market price increases. C) market demand increases. D) production
27、 costs must increase. 31) If the price of a product increases, then: A) market supply will increase. B) market supply will decrease. C) quantity supplied will increase. D) quantity demanded will increase. 32) If the price of SUVs falls, then: A) the supply of automobiles will fall. B) the supply of
28、automobiles will rise. C) the quantity supplied of automobiles will fall. D) the quantity supplied of automobiles will rise. 33) If the expected future price of an automobile rises, then: A) the supply of automobiles will fall. B) the supply of automobiles will rise. C) the quantity supplied of auto
29、mobiles will fall. D) the quantity supplied of automobiles will rise. 34) At the market equilibrium, A) quantity demanded is greater than quantity supplied. B) quantity supplied is greater than quantity demanded. C) quantity demanded is equal to quantity supplied. D) quantity supplied determines wha
30、t quantity supplied will be. 35) The existence of a surplus in a market will cause: A) market price to rise and quantity supplied to decrease. B) market price to fall and quantity supplied to decrease. C) market price to rise and quantity supplied to increase. D) market price to fall and quantity su
31、pplied to increase. 36) The existence of a shortage in a market will cause: A) market price to rise and quantity demanded to decrease. B) market price to fall and quantity demanded to decrease. C) market price to rise and quantity demanded to increase. D) market price to fall and quantity demanded t
32、o increase. 37) A shortage in a market means: A) quantity demand is greater than quantity supplied. B) quantity supplied is greater than quantity demanded. C) demand is greater than supply. D) supply is greater than demand. 38) A firm tries to increase the demand for the product it sells by: A) lowe
33、ring its price. B) convincing buyers that the price will be lower in the future. C) advertising the product to change buyers tastes in favor of the product. D) using the latest technology to produce the product. Refer to Figure 3.1 for the questions below.Figure 3.139) In figure 3.1, if demand incre
34、ases, then equilibrium: A) price and quantity rise. B) price and quantity fall. C) price rises and quantity falls. D) price falls and quantity rises. 40) In figure 3.1, if supply increases, then equilibrium: A) price and quantity rise. B) price and quantity fall. C) price rises and quantity falls. D
35、) price falls and quantity rises. 41) In figure 3.1, if demand and supply decrease, then equilibrium: A) price rises. B) price falls. C) quantity falls. D) quantity rises. 42) Price in a competitive market is determined by: A) sellers unilaterally. B) buyers unilaterally. C) an interaction of demand
36、 and supply. D) government. 43) If there is a surplus in a market, then the market is brought back into equilibrium by: A) price falling. B) quantity demanded rising. C) quantity supplied falling. D) all of the above. 44) If a market has a shortage, then it will be brought back into equilibrium by:
37、A) price falling. B) quantity demanded rising. C) quantity supplied rising. D) all of the above. 45) Which of the following describes what occurs at a market equilibrium? A) Everyone who wants to buy at the current price can do so. B) Every seller who is willing to sell at the current price can do s
38、o. C) The market is cleared, there is no surplus and no shortage. D) All these correctly describe what happens at a market equilibrium. 46) If the price of plywood suddenly increases, which of the following would be a likely explanation? A) Demand for construction materials has increased because of
39、a hurricane. B) Supply of plywood has increased because of more competition in the wood products industry. C) Demand has decreased because of the higher price. D) People are behaving irrationally. 47) If auto workers wages rise, then the: A) market demand for automobiles would increase because buyer
40、 incomes would be higher. B) market demand for automobiles would decrease because the price of automobiles would be higher. C) market supply of automobiles would increase because the price of automobiles would be higher. D) market supply of automobiles would decrease because costs of production woul
41、d be higher. 48) Shortly after the price of beef increases, the price of chicken increases also because: A) buyers are irrational. B) sellers are taking advantage of consumers. C) the goods are substitutes and the higher price of beef increases demand for chicken. D) the goods are complements and the higher price of beef increases demand for chicken. 49) As the population increases: A) demand for all goods will increase. B) supply of all goods will increase. C) the quantity demanded of all goods will increase. D) price of all goods will decrease.
