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A normal good is defined as a good


A) with a downward sloping demand curve.
B) for which demand increases when the price of a substitute rises.
C) for which demand increases when income increases.
D) for which demand increases when the number of demanders increases.
E) for which demand increases when the price of a complement falls.

F) C) and D)
G) A) and B)

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-The above table gives the demand and supply schedules for cat food.If the price is $3.00 per pound of cat food,will there be a shortage,a surplus,or is this price the equilibrium price? If there is a shortage,how much is the shortage? If there is a surplus,how much is the surplus? If $3.00 is the equilibrium price,what is the equilibrium quantity? -The above table gives the demand and supply schedules for cat food.If the price is $3.00 per pound of cat food,will there be a shortage,a surplus,or is this price the equilibrium price? If there is a shortage,how much is the shortage? If there is a surplus,how much is the surplus? If $3.00 is the equilibrium price,what is the equilibrium quantity?

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At a price of $3.00 per pound ...

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-Using the data in the table above,at the price of $80 a phone, A) a shortage of 25,000 cellular telephones occurs. B) a surplus of 80,000 cellular telephones occurs. C) a surplus of 25,000 cellular telephones occurs. D) a shortage of 55,000 cellular telephones occurs. E) the market is in equilibrium. -Using the data in the table above,at the price of $80 a phone,


A) a shortage of 25,000 cellular telephones occurs.
B) a surplus of 80,000 cellular telephones occurs.
C) a surplus of 25,000 cellular telephones occurs.
D) a shortage of 55,000 cellular telephones occurs.
E) the market is in equilibrium.

F) A) and D)
G) B) and C)

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-In the figure above,a price of $15 per dozen roses results in A) equilibrium. B) a shortage. C) a surplus. D) downward pressure on the price of roses. E) an eventual leftward shift of the demand curve and/or rightward shift of the supply curve. -In the figure above,a price of $15 per dozen roses results in


A) equilibrium.
B) a shortage.
C) a surplus.
D) downward pressure on the price of roses.
E) an eventual leftward shift of the demand curve and/or rightward shift of the supply curve.

F) C) and D)
G) A) and B)

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-The graph illustrates the demand for peanuts.Peanuts are a normal good because the A) demand curve for peanuts slopes downward. B) demand for peanuts increases when income increases. C) demand for peanuts increases when the price of one of its substitutes rises. D) peanuts have both substitutes and complements. E) demand curve shows that if the price of peanuts rises, there is a movement along the demand curve to a lower quantity demanded. -The graph illustrates the demand for peanuts.Peanuts are a normal good because the


A) demand curve for peanuts slopes downward.
B) demand for peanuts increases when income increases.
C) demand for peanuts increases when the price of one of its substitutes rises.
D) peanuts have both substitutes and complements.
E) demand curve shows that if the price of peanuts rises, there is a movement along the demand curve to a lower quantity demanded.

F) D) and E)
G) A) and B)

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-The graph illustrates the demand curve for soda.After a rise in the price of a soda from $1.00 a can to $2.00 a can,the quantity of soda demanded A) decreases from 2 cans to 0 cans a day. B) increases from 0 cans to 2 cans a day. C) remains unchanged. D) decreases from 1 can to 0 cans a day. E) cannot be determined from the figure because the demand curve will shift to a new curve. -The graph illustrates the demand curve for soda.After a rise in the price of a soda from $1.00 a can to $2.00 a can,the quantity of soda demanded


A) decreases from 2 cans to 0 cans a day.
B) increases from 0 cans to 2 cans a day.
C) remains unchanged.
D) decreases from 1 can to 0 cans a day.
E) cannot be determined from the figure because the demand curve will shift to a new curve.

F) C) and D)
G) All of the above

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Which of the following lower the equilibrium price of a canoe?


A) an increase in the supply of canoes
B) an increase in the demand for canoes
C) an increase in the quantity of canoes supplied
D) a decrease in the supply of canoes
E) Both answers A and B are correct.

F) All of the above
G) B) and E)

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-The graph illustrates the supply of sweaters.Which of the following events will increase the quantity supplied of sweaters? A) a rise in the price of a sweater B) a rise in the wage rate paid to the workers who make sweaters C) a rise in the expected future price of a sweater D) an increase in the number of sellers of sweaters E) a decrease in the number of sweater buyers -The graph illustrates the supply of sweaters.Which of the following events will increase the quantity supplied of sweaters?


A) a rise in the price of a sweater
B) a rise in the wage rate paid to the workers who make sweaters
C) a rise in the expected future price of a sweater
D) an increase in the number of sellers of sweaters
E) a decrease in the number of sweater buyers

F) A) and B)
G) C) and D)

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What leads to a decrease in the quantity supplied of a good or service?

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The quantity supplied of a goo...

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A supply curve


A) slopes downward.
B) slopes upward.
C) is a graph of the relationship between quantity supplied of a good and its price.
D) Both answers B and C are correct.
E) Both answers A and C are correct.

F) A) and D)
G) C) and D)

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If an early frost destroys most of the apple crop,the equilibrium price of an apple ________ and the equilibrium quantity ________.


A) rises; increases
B) rises; decreases
C) falls; increases
D) falls; decreases
E) does not change; decreases

F) B) and C)
G) D) and E)

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Changes in which of the following factors do NOT shift the demand curve?


A) the price of the good
B) buyers' incomes
C) the price of a substitute good
D) the number of buyers
E) the price expected in the future

F) B) and D)
G) A) and B)

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If the supply of iPods increases,then i.the supply curve for iPods has shifted rightward. ii.the price of iPods has decreased. iii.there will be a movement upward along the iPod supply curve.


A) i only
B) i, ii and iii
C) i and ii
D) ii and iii
E) i and iii

F) B) and E)
G) A) and E)

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If the price of iPods decreases,


A) there will be a movement down along the supply curve for iPods.
B) there will be a rightward shift in the iPod supply curve.
C) there will be a movement up along the supply curve for iPods.
D) the supply curve for iPods shifts leftward.
E) there has been a decrease in the price of iTunes songs.

F) D) and E)
G) None of the above

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Which of the following definitely results in a product's equilibrium price rising?


A) an increase in both demand and supply
B) a decrease in both demand and supply
C) an increase in demand combined with a decrease in supply
D) a decrease in demand combined with an increase in supply
E) an increase in the supply combined with no change in the demand

F) All of the above
G) B) and C)

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-The above figure shows the market for game day t-shirts.If the price of t-shirts is $10,then A) there is a surplus and the price of t-shirts will rise. B) there is a shortage and the price of t-shirts will rise. C) there is a shortage and the price of t-shirts will fall. D) there is a surplus and the price of t-shirts will fall. E) the market is in equilibrium. -The above figure shows the market for game day t-shirts.If the price of t-shirts is $10,then


A) there is a surplus and the price of t-shirts will rise.
B) there is a shortage and the price of t-shirts will rise.
C) there is a shortage and the price of t-shirts will fall.
D) there is a surplus and the price of t-shirts will fall.
E) the market is in equilibrium.

F) All of the above
G) A) and B)

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Consumers can use either natural gas or heating oil to warm their houses.Suppose the price of natural gas increases.Use a demand and supply diagram to show the impact of the higher price of natural gas on the market for home heating oil.

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Suppose the current price of a pound of steak is $12 per pound and the equilibrium price is $9 per pound.In this case,there is a


A) shortage, so the price falls and quantity demanded increases.
B) surplus, so the price falls and quantity demanded increases.
C) shortage, so the price rises and quantity demanded decreases.
D) surplus, so the price rises and quantity demanded increases.
E) surplus, so the price falls and quantity supplied increases.

F) C) and D)
G) None of the above

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-In the above figure,the movement from point a to point b reflects A) an increase in the price of pizza. B) an increase in the supply of pizza. C) an increase in the number of producers of pizza. D) a decrease in the cost of the tomato sauce used to produce pizza. E) a decrease in income if pizza is a normal good. -In the above figure,the movement from point a to point b reflects


A) an increase in the price of pizza.
B) an increase in the supply of pizza.
C) an increase in the number of producers of pizza.
D) a decrease in the cost of the tomato sauce used to produce pizza.
E) a decrease in income if pizza is a normal good.

F) A) and D)
G) None of the above

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Which of the following results in an increase in the supply of a good or service?


A) a fall in the price of the good or service
B) a smaller number of sellers producing the good or service
C) an increase in foreign imports of the good or service
D) higher taxes imposed upon producers of the good or service
E) a rise in the price of the good or service

F) B) and E)
G) A) and B)

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