Question 1

If the price of Gatorade increases,the equilibrium price of Powerade,a substitute good,will ________ because of a shift in ________.

Accepted Answer

When the price of Gatorade increases, consumers will look for substitutes, increasing the demand for Powerade. This shift in demand causes the equilibrium price of Powerade to increase.

Question 2

Firm A notices that Firm B is making a profit by producing footballs.There is nothing stopping Firm A from entering the football market,so it does.Holding all else constant,the number of firms in the market will

Accepted Answer

When Firm A enters the football market, the number of firms increases. This addition of a new producer increases the overall market supply of footballs, assuming all else remains constant.

Question 3

In the first few months of 2012,the price of gasoline increased by approximately 15 percent.Because of this increase,we would expect the ________ curve in the market for hybrid cars to ________.

Accepted Answer

As the price of gasoline increases, consumers are more likely to seek fuel-efficient alternatives, such as hybrid cars. This increases the demand for hybrid cars, shifting the demand curve to the right.

Question 4

Some studies have shown that eating chocolate before a test can increase brain activity,thereby causing students to score higher on exams.When these findings were announced,the price and quantity sold of chocolate increased in college towns.One reason for this could have been that the

Accepted Answer

The announcement of the study findings increased the demand for chocolate among students in college towns, resulting in an increase in the quantity sold and price of chocolate. The supply may not necessarily have increased, as it depends on the capability and capacity of the chocolate producers. Therefore, the best choice is B - consumers increased their demand for chocolate.

Question 5

A shortage occurs whenever

Accepted Answer

A shortage occurs when the quantity supplied (by producers) is less than the quantity demanded (by consumers) at a given price. This means that there are not enough goods or services available to meet the demand of consumers, leading to a situation where some consumers may not be able to purchase the product they want.

Question 6

After a new technology is introduced,the price typically falls.What is a possible explanation for this?

Accepted Answer

The answer of After a new technology is introduced,the price...

Question 7

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

Accepted Answer

Price expectations influence how much of a product a company like Old Navy might stock at different times of the year. Expecting higher demand and potentially higher prices in the summer for Bermuda shorts, Old Navy increases its stock to meet this anticipated demand.

Question 8

The latest data from the movie studios reveals that attendance at movies has declined as well as the average ticket price.How could this have possibly happened?

Accepted Answer

The data shows that attendance has declined, indicating a decrease in demand. Additionally, the average ticket price has also decreased, which indicates no change in supply. Therefore, the best choice is D, indicating a decrease in demand and no change in supply.

Question 9

When the demand curve shifts to the right and the supply curve is held constant,

Accepted Answer

When the demand curve shifts to the right and the supply curve is held constant, it leads to an increase in both equilibrium price and equilibrium quantity. This is because there is a higher demand for the same amount of supply, leading to an increase in both price and quantity demanded.

Question 10

Which of the following situations would cause the demand curve to shift to the right?

Accepted Answer

The answer of Which of the following situations would cause...

Question 11

The economists at JET Consulting consider Campbell's Soup to be an inferior good.During a recession,when the income in the economy is decreasing,economists at JET Consulting would expect the demand curve for Campbell's Soup to ________,causing the equilibrium price to ________ and the equilibrium quantity to ________.

Accepted Answer

Inferior goods are those for which demand increases when consumer income decreases. During a recession, as incomes fall, consumers tend to buy more of these goods because they are cheaper alternatives to more expensive options. Therefore, the demand curve for Campbell's Soup would shift to the right, causing both the equilibrium price and quantity to increase.

Question 12

The equilibrium price of peanut butter is $5.A study comes out that says the fat in peanut butter is good for the heart.Holding all other factors constant,which of the following scenarios could happen?

Accepted Answer

The study indicating that the fat in peanut butter is good for the heart will create a greater demand for peanut butter. Therefore, holding all other factors constant, there will be an increase in demand which will lead to an increase in the equilibrium price of peanut butter. A demand shift would be accompanied by a movement along the supply curve rather than a shift in the supply curve. Therefore, the best choice is D.

Question 13

James specializes in college-level economics tutoring.He knows that during the two weeks before finals he can charge more for an hour of private tutoring.Expecting this price increase,James will

Accepted Answer

James anticipates higher demand for his tutoring services as finals approach, leading him to withhold some of his current tutoring capacity to take advantage of higher future prices. This action effectively reduces the current supply of his tutoring services, shifting the supply curve to the left.

Question 14

When the price of ground beef increases and all else is held constant,we would expect the supply of hamburgers to ________,causing the price to ________.

Accepted Answer

When the price of ground beef (an input cost) increases, the supply of hamburgers (made from ground beef) would decrease because it becomes more expensive to produce hamburgers. This decrease in supply, with demand remaining constant, would lead to an increase in the price of hamburgers.

Question 15

Refer to the following figure to answer the following questions. 
-According to the accompanying figure,if the price is $10,there is a ________ of ________ units.

Accepted Answer

At a price of $10, the quantity demanded exceeds the quantity supplied, leading to a surplus of 15 units.

Question 16

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

At a price of $2.00, the quantity demanded is 50 units and the quantity supplied is only 20 units, resulting in a shortage of 30 units. Therefore, the best choice is C, which identifies a shortage of 30 units. None of the other choices accurately reflect the situation described by the table.

Question 17

Refer to the following figure to answer the following questions. 
-Which of the quantity (Q)and price (P)combinations in the accompanying figure represents the market at competitive equilibrium?

Accepted Answer

At point C, the quantity demanded (Qd) is equal to the quantity supplied (Qs) and the price (P) is $8. This represents the competitive equilibrium in the market.

Question 18

Refer to the following table to answer the following questions. 
-The equilibrium price and quantity in this market are

Accepted Answer

The answer of Refer to the following table to answer...

Question 19

When the price is ________ the equilibrium price,we would expect there to be a ________,causing the market to put ________ pressure on the price until it went back to the equilibrium price.

Accepted Answer

When the price is above the equilibrium price, there is more supply than demand, leading to a surplus. This surplus puts downward pressure on the price as sellers lower prices to clear their excess inventory, moving the price back towards equilibrium.

Question 20

Refer to the accompanying graph.If a tax is placed on a good and all else is held constant,we would assume that the supply curve would

Accepted Answer

When a tax is placed on a good, the cost of production for the supplier increases, thus reducing the quantity supplied at every price level. This results in a leftward shift of the supply curve. Therefore, the supply curve would shift from S₁ to S₂.

Quiz 3: The Market at Work: Supply and Demand

If the price of Gatorade increases,the equilibrium price of Powerade,a substitute good,will because of a shift in .

Firm A notices that Firm B is making a profit by producing footballs.There is nothing stopping Firm A from entering the football market,so it does.Holding all else constant,the number of firms in the market will

In the first few months of 2012,the price of gasoline increased by approximately 15 percent.Because of this increase,we would expect the curve in the market for hybrid cars to .

Some studies have shown that eating chocolate before a test can increase brain activity,thereby causing students to score higher on exams.When these findings were announced,the price and quantity sold of chocolate increased in college towns.One reason for this could have been that the

A shortage occurs whenever

After a new technology is introduced,the price typically falls.What is a possible explanation for this?

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

The latest data from the movie studios reveals that attendance at movies has declined as well as the average ticket price.How could this have possibly happened?

When the demand curve shifts to the right and the supply curve is held constant,

Which of the following situations would cause the demand curve to shift to the right?

The economists at JET Consulting consider Campbell's Soup to be an inferior good.During a recession,when the income in the economy is decreasing,economists at JET Consulting would expect the demand curve for Campbell's Soup to ,causing the equilibrium price to and the equilibrium quantity to .

The equilibrium price of peanut butter is $5.A study comes out that says the fat in peanut butter is good for the heart.Holding all other factors constant,which of the following scenarios could happen?

James specializes in college-level economics tutoring.He knows that during the two weeks before finals he can charge more for an hour of private tutoring.Expecting this price increase,James will

When the price of ground beef increases and all else is held constant,we would expect the supply of hamburgers to ,causing the price to .

Refer to the following figure to answer the following questions. -According to the accompanying figure,if the price is $10,there is a of units.

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.

Refer to the following figure to answer the following questions. -Which of the quantity (Q) and price (P) combinations in the accompanying figure represents the market at competitive equilibrium?

Refer to the following table to answer the following questions. -The equilibrium price and quantity in this market are

When the price is the equilibrium price,we would expect there to be a ,causing the market to put pressure on the price until it went back to the equilibrium price.

Refer to the accompanying graph.If a tax is placed on a good and all else is held constant,we would assume that the supply curve would

Quiz 3: The Market at Work: Supply and Demand

If the price of Gatorade increases,the equilibrium price of Powerade,a substitute good,will ________ because of a shift in ________.

Firm A notices that Firm B is making a profit by producing footballs.There is nothing stopping Firm A from entering the football market,so it does.Holding all else constant,the number of firms in the market will

In the first few months of 2012,the price of gasoline increased by approximately 15 percent.Because of this increase,we would expect the ________ curve in the market for hybrid cars to ________.

Some studies have shown that eating chocolate before a test can increase brain activity,thereby causing students to score higher on exams.When these findings were announced,the price and quantity sold of chocolate increased in college towns.One reason for this could have been that the

A shortage occurs whenever

After a new technology is introduced,the price typically falls.What is a possible explanation for this?

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

The latest data from the movie studios reveals that attendance at movies has declined as well as the average ticket price.How could this have possibly happened?

When the demand curve shifts to the right and the supply curve is held constant,

Which of the following situations would cause the demand curve to shift to the right?

The equilibrium price of peanut butter is $5.A study comes out that says the fat in peanut butter is good for the heart.Holding all other factors constant,which of the following scenarios could happen?

James specializes in college-level economics tutoring.He knows that during the two weeks before finals he can charge more for an hour of private tutoring.Expecting this price increase,James will

When the price of ground beef increases and all else is held constant,we would expect the supply of hamburgers to ________,causing the price to ________.

Refer to the following figure to answer the following questions. -According to the accompanying figure,if the price is $10,there is a ________ of ________ units.

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.

Refer to the following figure to answer the following questions. -Which of the quantity (Q) and price (P) combinations in the accompanying figure represents the market at competitive equilibrium?

Refer to the following table to answer the following questions. -The equilibrium price and quantity in this market are

When the price is ________ the equilibrium price,we would expect there to be a ________,causing the market to put ________ pressure on the price until it went back to the equilibrium price.

Refer to the accompanying graph.If a tax is placed on a good and all else is held constant,we would assume that the supply curve would

If the price of Gatorade increases,the equilibrium price of Powerade,a substitute good,will because of a shift in .

In the first few months of 2012,the price of gasoline increased by approximately 15 percent.Because of this increase,we would expect the curve in the market for hybrid cars to .

When the price of ground beef increases and all else is held constant,we would expect the supply of hamburgers to ,causing the price to .

Refer to the following figure to answer the following questions. -According to the accompanying figure,if the price is $10,there is a of units.

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.

When the price is the equilibrium price,we would expect there to be a ,causing the market to put pressure on the price until it went back to the equilibrium price.