Question 1

Describe one of the two reasons given in the textbook to help explain why price and quantity demanded are inversely related.

Accepted Answer

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Question 2

Explain what it means to say that "the market" feeds Cleveland.Give an example using a specific food item to help support your answer.

Accepted Answer

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Question 3

When Hurricane Katrina hit the Gulf Coast of the United States in 2005 it destroyed 5,000,000 acres of timber.Given that lumber is timber that has been sawed or split into planks and boards,explain in terms of supply and/or demand how the hurricane impacted each of the following markets (be sure to note the expected resulting impact on equilibrium price and quantity):
a.Domestic lumber
b.Imported lumber
c.New home construction

Accepted Answer

The answer of When Hurricane Katrina hit the Gulf Coast...

Question 4

When income rises for the buyers of good X,the ____________ curve for good X will shift ________________.
A)demand;rightward
B)demand;leftward
C)supply;rightward
D)supply;leftward
E)This question cannot be answered unless we know whether good X is a normal good,a neutral good,or an inferior good.

Accepted Answer

The answer of When income rises for the buyers of...

Question 5

The law of demand states that price and ______________ are _____________ related,ceteris paribus.
A)demand;inversely
B)quantity demanded;inversely
C)demand;directly
D)quantity demanded;directly
E)​quantity supplied;directly

Accepted Answer

The law of demand states that price and quantity demanded are inversely related, ceteris paribus. This means that as the price of a good or service increases, the quantity demanded for that good or service will decrease, and vice versa, assuming that all other factors that could affect demand remain constant.

Question 6

When P = $65,the quantity demanded of a good is 80 units,and the quantity supplied of the good is 40 units.For every $10 increase in the price of this good,quantity demanded falls by 10 units and quantity supplied rises by 10 units.The equilibrium price of this good is ___________and the equilibrium quantity of this good is _________ units.
A)$55;30
B)$75;50
C)$75;70
D)$85;50
E)$85;60

Accepted Answer

The answer of When P = $65,the quantity demanded of...

Question 7

Suppose that the average price of refrigerators has fallen over the past few years,yet the refrigerator companies have offered more and more of them for sale.Does this mean that the supply curve for refrigerators is downward sloping? Explain.

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Question 8

Explain the difference between a change in supply and a change in quantity supplied.Be sure to state what causes each to change and how they differ when graphed.

Accepted Answer

The answer of Explain the difference between a change in...

Question 9

With respect to the supply and demand for a given product,describe the connection that exists between equilibrium/disequilibrium and predictions.Cite your own unique example in order to help support your answer.

Accepted Answer

The answer of With respect to the supply and demand...

Question 10

Explain why the price of a good tends to rise when there is a shortage of the good.Give a hypothetical numerical example to help support your answer.

Accepted Answer

The answer of Explain why the price of a good...

Question 11

A change in price will lead to a change in __________ and to a change in __________,while a change in government subsidies will lead to a change in __________ and a change in the number of buyers will lead to a change in __________.
A)quantity demanded;quantity supplied;supply;demand
B)demand;quantity supplied;supply;quantity demanded
C)quantity demanded;supply;quantity supplied;demand
D)quantity supplied;quantity demanded;demand;supply
E)quantity demanded;demand;quantity supplied;supply

Accepted Answer

A change in price affects the quantity demanded and quantity supplied directly, while a change in government subsidies affects supply, and a change in the number of buyers affects demand.

Question 12

Explain why the price of a good tends to fall when there is a surplus of the good.Give a hypothetical numerical example to help support your answer.

Accepted Answer

The answer of Explain why the price of a good...

Question 13

Equilibrium and disequilibrium
A)are real world states.
B)are mental constructs used by economists.
C)foreshadow what is about to happen in a market.
D)a and b
E)a,b and c

Accepted Answer

Equilibrium and disequilibrium are not just mental constructs used by economists but are also real world states that can be observed and analyzed in markets. Additionally, identifying whether a market is in equilibrium or disequilibrium can help economists predict what may happen in the future. Therefore, all three options (A, B, and C) are true.

Question 14

According to the law of demand,the higher the price of an assigned textbook,the _______________ the quantity demanded of assigned textbooks will be,ceteris paribus,and the ______________ likely students will seek out an alternative to the assigned textbook.
A)lower;less
B)lower;more
C)higher;less
D)higher;more

Accepted Answer

The law of demand states that, all else being equal, as the price of a good increases, the quantity demanded of that good decreases. Therefore, if the price of an assigned textbook is higher, the quantity demanded will be lower, and students will be more likely to seek alternatives.

Question 15

If a market is in disequilibrium,economists would predict that the product's price would __________ to reach equilibrium when the quantity demanded is __________ than the quantity supplied.
A)rise;greater
B)fall;less
C)fall;greater
D)rise;less
E)a and b

Accepted Answer

When the quantity demanded is greater than the quantity supplied, prices tend to rise to reach equilibrium, as the scarcity of the product increases its value. Conversely, when the quantity demanded is less than the quantity supplied, prices tend to fall to eliminate the surplus and reach equilibrium.

Question 16

Which of the following is an example of a service?
A)medical care
B)dental care
C)a psychology lecture
D)a television set
E)a,b and c

Accepted Answer

Medical care, dental care, and a psychology lecture are all examples of services because they involve the provision of intangible benefits or activities performed for a consumer, unlike a television set, which is a tangible good.

Question 17

Explain the difference between a change in demand and a change in quantity demanded.Be sure to specify what causes each to change and how they differ when graphed.

Accepted Answer

The answer of Explain the difference between a change in...

Quiz 3: Supply and Demand: Theory

Describe one of the two reasons given in the textbook to help explain why price and quantity demanded are inversely related.

Explain what it means to say that "the market" feeds Cleveland.Give an example using a specific food item to help support your answer.

When income rises for the buyers of good X,the curve for good X will shift ____.

The law of demand states that price and __ are _ related,ceteris paribus.

Suppose that the average price of refrigerators has fallen over the past few years,yet the refrigerator companies have offered more and more of them for sale.Does this mean that the supply curve for refrigerators is downward sloping? Explain.

Explain the difference between a change in supply and a change in quantity supplied.Be sure to state what causes each to change and how they differ when graphed.

With respect to the supply and demand for a given product,describe the connection that exists between equilibrium/disequilibrium and predictions.Cite your own unique example in order to help support your answer.

Explain why the price of a good tends to rise when there is a shortage of the good.Give a hypothetical numerical example to help support your answer.

A change in price will lead to a change in and to a change in ,while a change in government subsidies will lead to a change in and a change in the number of buyers will lead to a change in .

Explain why the price of a good tends to fall when there is a surplus of the good.Give a hypothetical numerical example to help support your answer.

Equilibrium and disequilibrium

According to the law of demand,the higher the price of an assigned textbook,the _ the quantity demanded of assigned textbooks will be,ceteris paribus,and the likely students will seek out an alternative to the assigned textbook.

If a market is in disequilibrium,economists would predict that the product's price would to reach equilibrium when the quantity demanded is than the quantity supplied.

Which of the following is an example of a service?

Explain the difference between a change in demand and a change in quantity demanded.Be sure to specify what causes each to change and how they differ when graphed.