Ch 3

Question 0

When the price of Nike fell, Ronaldo purchased more Nike soccer balls and fewer Adidas soccer balls. Which of the following best explains Rinaldo’s decision to buy more Nike soccer balls?

Answer 0

The substitution effect

Question 1

A demand curve shows the relationship between

Answer 1

Price and quantity demanded

Question 2

If x is a normal good, a rise in money income will shift the

Answer 2

Demand curve for x to the right

Question 3

Other things equal, which of the following might shift the demand curve for gasoline to the left

Answer 3

The development of a low-cost electric automobile

Question 4

If the demand for steak (a normal good) shifts to the left, the most likely reason is that

Answer 4

consumer incomes have fallen

Question 5

Which of the following would most likely increase the demand for gasoline

Answer 5

Expectation by consumers the gasoline prices will be higher in the future

Question 6

Supposed that tacos and pizzas are substitutes, and that soda and pizza are compliments. We would expect an increase in the price of pizza to

Answer 6

Reduce the demand for soda and increased the demand for tacos

Question 7

In the corn market, demand often exceeds supply and supply sometimes exceeds demand. The price of corn rises and falls in response to changes in supply and demand. Which of these two statements are the terms demand and supply being used correctly

Answer 7

The second statement

Question 8

The term quantity demanded

Answer 8

Refers to the amount of a product that will be purchased at some specific price

Question 9

A decrease in the demand for recreational fishing boats might be caused by an increase in the

Answer 9

Price of outboard motors

Question 10

If the supply of a product decreases and the demand for that product simultaneously increases, then equilibrium

Answer 10

Price must rise, but equilibrium quantity may rise, fall, or remain unchanged

Question 11

Supposed that in 2007, Ford sold 500,000 mustangs at an average price of $18,800 per car; in 2008, 600,000 mustangs were sold on average price of 19,500 per car these statements

Answer 11

Suggest that the demand for mustangs increased between 2007 and 2008

Question 12

With a downsloping demand curve up sloping supply curve for a product, a decrease in resource prices will

Answer 12

Decrease equilibrium price and increased equilibrium quantity

Question 13

Over time, the equilibrium price of a gigabyte of computer memory has fallen while the equilibrium quantity purchased has increased. Based on this we can conclude that

Answer 13

Increases in the supply of computer memory have exceeded increases in demand

Question 14

If market demand increases and market supply decreases, the change in equilibrium price is unpredictable without first knowing the exact magnitudes of the demand and supply changes true or false

Answer 14

False

Question 15

A market

Answer 15

Is an institution that brings together buyers and sellers

Question 16

In presenting the idea of a demand curve, economists presume the most important variable in determining the quantity demanded is

Answer 16

The price of the product itself

Question 17

Which of the following would not shift the demand curve for beef

Answer 17

A reduction in the price of cattlefeed

Question 18

DVD players and DVDs are

Answer 18

Complementary goods

Question 19

Which of the following will cause the demand curve for product a to shift to the left

Answer 19

An increase in money income if a is an inferior good

Question 20

If X is a normal good, a rise in money income will shift the

Answer 20

Demand curve for X to the right

Question 21

College students living off campus frequently consumed large amounts of Romain noodles and boxed macaroni and cheese. When they finish school and start careers, their consumption of both goods frequently declines. This suggests that Ramen noodles and boxed macaroni and cheese are

Answer 21

Inferior goods

Question 22

Consumer income increase, the demand for product X

Answer 22

May shift either to the right or left

Question 23

In moving along the supply curve which of the following is not held constant

Answer 23

The price of the product for which the supply curve is relevant

Question 24

Supposed that corn prices rise significantly. Farmers expect the price of corn to continue rising relative to other crops, then we would expect

Answer 24

The supply to increase as farmers plant more corn

Question 25

At the current price there is a shortage of a product. We would expect price to

Answer 25

Increase, qty demanded to decrease, and quantity supplied to increase

Question 26

Assuming competitive markets with typical supply and demand curves, which of the following statements is correct

Answer 26

An increase in demand with no change in supply will result in an increase in sales

Question 27

A government subsidy per unit of output increases supply true or false

Answer 27

True

Question 28

Toothpaste and toothbrushes are substitute goods true or false

Answer 28

False