Question 1

Consider the global market for barley,an agricultural commodity.Suppose that in August,2014,the equilibrium price and quantity were P = $150 per tonne and Q = 350 million tonnes.In August,2015,the equilibrium price and quantity were P = $168 per tonne and Q = 350 million tonnes.Which of the following is the best possible explanation for this change in market equilibrium?

Accepted Answer

The increase in price with no change in quantity suggests a simultaneous increase in demand and decrease in supply, as both would push the price up while keeping the quantity constant.

Question 2

If a demand curve and a supply curve can be stated functionally as Q_d = 100 - 5P; and Q_s = 90 + 5P,respectively,then the equilibrium quantity and price (Q,P)would be

Accepted Answer

At equilibrium, Qd = Qs. Setting 100 - 5P = 90 + 5P and solving for P gives P = 1. Substituting P = 1 back into either equation gives Q = 95.

Question 3

If a demand curve and a supply curve can be stated functionally as Q_d = 500 - 0.1P and Q_s = 440 + 0.4P,respectively,then the equilibrium quantity and price (Q,P)would be

Accepted Answer

To find the equilibrium, set Qd = Qs: 500 - 0.1P = 440 + 0.4P. Solving for P gives P = 120. Substitute P = 120 into either equation to find Q, which is 488.

Question 4

Suppose that the price of good X increases from $3.00 to $4.00 while the price of good Y increases from $150 to $200.The relative price of X (in terms of Y)

Accepted Answer

The answer of Suppose that the price of good X...

Question 5

The relative price of a good

Accepted Answer

The relative price of a good reflects its price in terms of units of other goods, also known as its opportunity cost. It is not measured in current dollars, nor is it necessarily a measure of the share of the consumer's income devoted to its purchase. It is also not equal to the average price of the good over the last 5 years.

Question 6

Suppose that the price of wheat has fallen from $3 to $2 per bushel and that the price of newsprint has fallen from $200 to $100 per tonne.The relative price of wheat in terms of newsprint

Accepted Answer

The relative price of wheat in terms of newsprint has risen because the price of wheat has fallen by a smaller proportion (from $3 to $2, a 33.3% decrease) compared to the price of newsprint (from $200 to $100, a 50% decrease).

Question 7

Consider the global market for barley,an agricultural commodity.Suppose that in August,2014,the equilibrium price and quantity were P = $150 per tonne and Q = 350 million tonnes.In August,2015,the equilibrium price and quantity were P = $159 per tonne and Q = 372 million tonnes.Which of the following is the best possible explanation for this change in market equilibrium?

Accepted Answer

The increase in both price and quantity from 2014 to 2015 suggests an increase in demand for barley, as higher demand typically leads to higher prices and quantities in equilibrium.

Question 8

Consider the global market for barley,an agricultural commodity.Suppose that in August,2014,the equilibrium price and quantity were P = $150 per tonne and Q = 350 million tonnes.In August,2015,the equilibrium price and quantity were P = $168 per tonne and Q = 290 million tonnes.Which of the following is the best possible explanation for this change in market equilibrium?

Accepted Answer

The decrease in quantity (from 350 to 290 million tonnes) and increase in price (from $150 to $168 per tonne) suggest a decrease in supply, as there is less barley supplied at a higher price. This could be due to factors such as weather conditions leading to lower yields or a decrease in the number of barley farmers. The other options (A and C) suggest an increase in demand, which may result in a higher price but also a higher quantity traded, which is not the case here. Option B suggests an increase in supply, which would lead to a higher quantity traded at a lower price, which is also not the case here.

Question 9

Suppose that the demand and supply curves in the market for apples have the following functional form: Q_D = 250 - 4p and Q_S = 10 + p.If the prevailing price on the market is 50,then

Accepted Answer

The answer of Suppose that the demand and supply curves...

Question 10

Consider the global market for barley,an agricultural commodity.Suppose that in August,2014,the equilibrium price and quantity were P = $150 per tonne and Q = 350 million tonnes.In August,2015,the equilibrium price and quantity were P = $150 per tonne and Q = 410 million tonnes.Which of the following is the best possible explanation for this change in market equilibrium?

Accepted Answer

The equilibrium price remained the same while the quantity increased, indicating that both demand and supply increased simultaneously, keeping the price stable but increasing the quantity.

Question 11

Suppose the demand and supply curves in the market for apples have the following functional form: Q_D = 250 - 4p and Q_S = 10 + p.If the prevailing market price is 40,then

Accepted Answer

The answer of Suppose the demand and supply curves in...

Question 12

Suppose an index of average prices of imported goods in Canada indicates an increase in price of 2.3% over a 12-month period.Over the same period the Consumer Price Index indicates an increase in the general price level of 2.3%.What is the change in the price of imports relative to the change in the overall price level?

Accepted Answer

The increase in the average prices of imported goods and the increase in the general price level are both 2.3%, so there is no change in the relative price of imports. Therefore, the answer is E: no change.

Question 13

The price of one good divided by the price of another good is called a

Accepted Answer

The price of one good divided by the price of another good gives us the relative price of the two goods, showing the ratio at which the two goods can be exchanged in the market. Therefore, the correct answer is D) relative price.

Question 14

Consider the global market for some mineral,X.In January,2014,the equilibrium price and quantity were P = $27 per unit and Q = 140 million units.In January,2016,the equilibrium price and quantity were P = $45 per unit and Q = 175 million units.Which of the following is the best possible explanation for this change in market equilibrium?

Accepted Answer

An increase in equilibrium price and quantity indicates that there has been an increase in demand for mineral X, leading to a shift of the demand curve to the right. This could be due to various factors such as increased use of mineral X in production, or growing demand from emerging markets.

Question 15

Consider the global market for some mineral,X.In January,2014,the equilibrium price and quantity were P = $27 per unit and Q = 140 million units.In January,2016,the equilibrium price and quantity were P = $35 per unit and Q = 110 million units.Which of the following is the best possible explanation for this change in market equilibrium?

Accepted Answer

The increase in price and decrease in quantity suggest a decrease in supply. If there was an increase in demand, the quantity should have increased instead, leading to an increase in price. Choices C, D, and E are all implausible scenarios.

Question 16

Consider the global market for barley,an agricultural commodity.Suppose that in August,2014,the equilibrium price and quantity were P = $150 per tonne and Q = 350 million tonnes.In August,2015,the equilibrium price and quantity were P = $142 per tonne and Q = 335 million tonnes.Which of the following is the best possible explanation for this change in market equilibrium?

Accepted Answer

The decrease in equilibrium price and quantity suggests there has been a decrease in demand for barley.

Question 17

Suppose we observe that movie theatre prices are less during the daytime than in the evening.If the supply of movies does not change between daytime and evening,then the most likely explanation for this difference in price is

Accepted Answer

The evening demand curve is to the right of the daytime demand curve, indicating higher demand for movies in the evening, which explains the higher prices despite an unchanged supply.

Question 18

Suppose that the demand and supply curves in the market for apples have the following functional forms: Q_D = 250 - 4p and Q_S = 10 + p.The equilibrium quantity and price would then be

Accepted Answer

To find the equilibrium quantity and price, we need to set the quantity demanded equal to the quantity supplied and solve for the price. Quantity demanded: Q_D = 250 - 4p Quantity supplied: Q_S = 10 + p Setting these two equal: 250 - 4p = 10 + p Solving for p: 240 = 5p p = 48 Substituting p back into either the demand or supply function to find the equilibrium quantity: Q_D = 250 - 4(48) Q_D = 58 Therefore, the equilibrium quantity and price are Q = 58 and p = 48, respectively, making choice B the correct answer.

Question 19

Consider the global market for barley,an agricultural commodity.Suppose that in August,2014,the equilibrium price and quantity were P = $150 per tonne and Q = 350 million tonnes.In August,2015,the equilibrium price and quantity were P = $140 per tonne and Q = 325 million tonnes.Which of the following is the best possible explanation for this change in market equilibrium?

Accepted Answer

The decrease in both price and quantity from 2014 to 2015 suggests a decrease in demand for barley, as a lower demand would lead to a lower equilibrium price and quantity.

Question 20

Consider the global market for some mineral,X.In January,2014,the equilibrium price and quantity were P = $27 per unit and Q = 140 million units.In January,2016,the equilibrium price and quantity were P = $27 per unit and Q = 175 million units.Which of the following is the best possible explanation for this change in market equilibrium?

Accepted Answer

The equilibrium price remained the same while the quantity increased, indicating that both demand and supply increased simultaneously, keeping the price stable but increasing the quantity.

Quiz 3: Demand, Supply, and Price

If a demand curve and a supply curve can be stated functionally as Q_d = 100 - 5P; and Q_s = 90 + 5P,respectively,then the equilibrium quantity and price (Q,P) would be

If a demand curve and a supply curve can be stated functionally as Q_d = 500 - 0.1P and Q_s = 440 + 0.4P,respectively,then the equilibrium quantity and price (Q,P) would be

Suppose that the price of good X increases from $3.00 to $4.00 while the price of good Y increases from $150 to $200.The relative price of X (in terms of Y)

The relative price of a good

Suppose that the price of wheat has fallen from $3 to $2 per bushel and that the price of newsprint has fallen from $200 to $100 per tonne.The relative price of wheat in terms of newsprint

Suppose that the demand and supply curves in the market for apples have the following functional form: Q_D = 250 - 4p and Q_S = 10 + p.If the prevailing price on the market is 50,then

Suppose the demand and supply curves in the market for apples have the following functional form: Q_D = 250 - 4p and Q_S = 10 + p.If the prevailing market price is 40,then

The price of one good divided by the price of another good is called a

Suppose we observe that movie theatre prices are less during the daytime than in the evening.If the supply of movies does not change between daytime and evening,then the most likely explanation for this difference in price is

Suppose that the demand and supply curves in the market for apples have the following functional forms: Q_D = 250 - 4p and Q_S = 10 + p.The equilibrium quantity and price would then be

Quiz 3: Demand, Supply, and Price

If a demand curve and a supply curve can be stated functionally as Qd = 100 - 5P; and Qs = 90 + 5P,respectively,then the equilibrium quantity and price (Q,P) would be

If a demand curve and a supply curve can be stated functionally as Qd = 500 - 0.1P and Qs = 440 + 0.4P,respectively,then the equilibrium quantity and price (Q,P) would be

Suppose that the price of good X increases from $3.00 to $4.00 while the price of good Y increases from $150 to $200.The relative price of X (in terms of Y)

The relative price of a good

Suppose that the price of wheat has fallen from $3 to $2 per bushel and that the price of newsprint has fallen from $200 to $100 per tonne.The relative price of wheat in terms of newsprint

Suppose that the demand and supply curves in the market for apples have the following functional form: QD = 250 - 4p and QS = 10 + p.If the prevailing price on the market is 50,then

Suppose the demand and supply curves in the market for apples have the following functional form: QD = 250 - 4p and QS = 10 + p.If the prevailing market price is 40,then

The price of one good divided by the price of another good is called a

Suppose we observe that movie theatre prices are less during the daytime than in the evening.If the supply of movies does not change between daytime and evening,then the most likely explanation for this difference in price is

Suppose that the demand and supply curves in the market for apples have the following functional forms: QD = 250 - 4p and QS = 10 + p.The equilibrium quantity and price would then be

If a demand curve and a supply curve can be stated functionally as Q_d = 100 - 5P; and Q_s = 90 + 5P,respectively,then the equilibrium quantity and price (Q,P) would be

If a demand curve and a supply curve can be stated functionally as Q_d = 500 - 0.1P and Q_s = 440 + 0.4P,respectively,then the equilibrium quantity and price (Q,P) would be

Suppose that the demand and supply curves in the market for apples have the following functional form: Q_D = 250 - 4p and Q_S = 10 + p.If the prevailing price on the market is 50,then

Suppose the demand and supply curves in the market for apples have the following functional form: Q_D = 250 - 4p and Q_S = 10 + p.If the prevailing market price is 40,then

Suppose that the demand and supply curves in the market for apples have the following functional forms: Q_D = 250 - 4p and Q_S = 10 + p.The equilibrium quantity and price would then be