Supply, Demand, and Equilibrium Assessment Questions

According to the law of demand, a decrease in price

• Shifts the demand curve to the left.

• Shifts the demand curve to the right.

• Does not shift the demand curve, but results in a movement ALONG the demand curve to the left.

• Does not shift the demand curve, but results in a movement ALONG the demand curve to the right.

• There will be no change.

All of the following will shift the demand curve for oranges to the RIGHT except:

• An increase in the price of apples, a substitute for oranges.

• A new study shows that drinking fresh orange juice reduces the likelihood of kidney stones.

• A new technology for orange picking makes harvesting oranges cheaper.

• Consumers expect higher prices for oranges next month due to hurricanes destroying crops.

• All of the above shift the demand curve to the RIGHT.

An increase in the price of yellow paint coating, an input for No. 2 pencils, will:

• Cause the demand curve for No. 2 pencils to shift to the right.

• Cause the supply curve for No. 2 pencils to shift to the left.

• Cause the demand curve for ballpoint pens, a substitute for pencils, to shift to the left.

• None of the above.

An increase in the price of roses will:

• Definitely result in a shift to the right of the supply curve.

• Definitely result in an increase in the quantity demanded of roses.

• Definitely result in a decrease in the quantity demanded of roses.

• Definitely result in a shift to the left of the demand curve.

• Both A and C are true.

An increase in the price of oat milk, a substitute for almond milk, will:

• Decrease the quantity demanded of almond milk.

• Increase the quantity demanded of oat milk.

• Shift the demand curve for oat milk to the left.

• Shift the demand curve for almond milk to the right.

Take the market for professional cameras. If the price of a complement decreases,

• The demand curve for professional cameras will shift to the right.

• The demand curve for professional cameras will shift to the left.

• There will be no shift of the demand curve for professional cameras, but instead there will be movement along the demand curve to the right.

• There will be no shift in the demand curve for professional cameras, but instead a movement along the demand curve to the left.

• The supply curve will shift right.

Which of the following will cause a movement ALONG the supply curve for lumber?

• A new area of forest is purchased for logging (cutting trees for lumber).

• Consumer demand for decks and patios increases 10 fold (10x).

• Labor costs increase, prompting loggers to have to pay more for lumberjacks.

• All of the above.

• None of the above.

According to the law of supply, sellers will be more likely to increase their quantity supplied:

• When they can sell their goods cheaply.

• When there are lots of suppliers in the market.

• When they are the only supplier of a good.

• When the selling price increases.

When Joanna permanently closes the movie theater she ran in her hometown, this causes:

• A shift to the right of the supply curve for movie tickets.

• A shift to the left of the supply curve for movie tickets.

• A movement along the supply curve for movie tickets, that is a decrease in the quantity supplied.

• A shift to the left in the demand curve for movie tickets.

What happens in the market for cheese when the price of milk decreases?

• The price of cheese decreases and equilibrium quantity stays the same.

• The price of cheese increases due to the increased demand (shift to the right) for milk.

• The price of cheese decreases and the quantity of cheese at equilibrium increases, since milk is an ingredient in cheese.

• The price of cheese is unrelated to the price of milk.