Economics Quiz

In a competitive market, each seller has limited control over the price of his product because

• other sellers are offering similar products.

• buyers exert more control over the price than do sellers.

• these markets are highly regulated by government

• sellers usually agree ot set a common price that will allow each seller to earn a comfortable profit.

When the number of buyers in a market increases,

• the market demand curve shifts to the right.

• the demand curves of the individual demanders in the market are unaffected.

• the market demand for the good in question increases

• All of these answers are correct

If buyers today become more willing and able than before to purchase larger quantities of Vanilla Coke at each price of Vanilla Coke,

• we will observe a movement downward along the demand curve for Vanilla Coke.

• we will observe a movement upward along the demand curve for Vanilla Coke.

• the demand curve for Vanilla Coke will shift to the right.

• the demand curve for Vanilla Coke will shift to the left.

The current price of neckties is $30 and the equilibrium price of neckties is $25. As a result,

• the quantity supplied of neckties exceeds the quantity demanded of neckties at the $30 price.

• the equilibrium quantity of neckties exceeds the quantity demanded at the $30 price.

• There is a surplus of neckties at the $30 price

• All of these answers are correct

Which of the following events would cause both the equilibrium price and equilibrium quantity of number two grade potatoes (an inferior good) to increase?

• an increase in consumer income

• a decrease in consumer income

• greater government restrictions on agricultural chemicals

• fewer government restrictions on agricultural chemicals

If a study by medical researchers found that brown sugar caused weight loss while white sugar caused weight gain we likely would see

• an increase in demand for brown sugar and a decrease in demand for white sugar.

• an increase in demand for brown sugar, but no change in the demand for white sugar.

• a decrease in the demand for white sugar, but no change in the demand for brown sugar.

• no change in either demand because weight loss is not a nonprice determinant of demand.

Warrensburg is a small college town in Missouri. At the end of August each year, the market demand for fast food in Warrensburg

• increases.

• decreases.

• remains constant, but we observe a movement downward and to the right along the

  demand curve.

• remains constant, but we observe a movement upward and to the right along the supply

  curve

Suppose that a decrease in the price of good X results in fewer units of good Y being sold. This implies that X and Y are:

• complementary goods.

• normal goods.

• inferior goods.

• substitute goods.

Refer to Figure 4-1. The movement from point A to point B on the graph would be caused by:

• an increase in price.

• a decrease in price.

• a decrease in the price of a substitute good.

• an increase in income.

Refer to Figure 4-5. The movement from point A to point B on the graph is called:

• a decrease in supply.

• an increase in supply.

• an increase in the quantity supplied.

• a decrease in the quantity supplied.