51
37) The price of circuit boards used in the manufacturing of LCD televisions has fallen. This will lead to
________ LCD televisions.
A) an increase in the supply of
B) a decrease in the supply of
C) an increase in the quantity supplied of
D) a decrease in the quantity supplied of
Topic: Supply in Product / Output Markets
Skill: Conceptual
AACSB: Reflective Thinking
Learning Outcome: Micro-4
38) If the price of spinach decreases, there will be ________ of spinach enchiladas.
A) an increase in the supply
B) a decrease in the supply
C) an increase in the quantity supplied
D) a decrease in the quantity supplied
Topic: Supply in Product / Output Markets
Skill: Conceptual
AACSB: Reflective Thinking
Learning Outcome: Micro-4
39) An electronics manufacturer can produce either MP3 players or cell phones. As the result of a
decrease in the price of cell phones, the firm produces more MP3 players and fewer cell phones. An
economist would explain this by saying
A) the supply of cell phones increased and the supply of MP3 players decreased.
B) there has been an increase in the quantity supplied of cell phones and a decrease in the quantity
supplied of MP3 players.
C) there has been a decrease in the quantity supplied of cell phones and an increase in the supply of MP3
players.
D) the supply of cell phones increased and the quantity supplied of MP3 players decreased.
Topic: Supply in Product / Output Markets
Skill: Conceptual
AACSB: Reflective Thinking
Learning Outcome: Micro-4
52
40) The change in the ________ of a good leads to a change in ________, which leads to a ________.
A) price; quantity supplied; movement along a supply curve
B) quantity; supply; change in demand
C) supply; demand; change in price
D) demand; quantity demanded; supply
Topic: Supply in Product / Output Markets
Skill: Conceptual
AACSB: Reflective Thinking
Learning Outcome: Micro-4
41) A shift of the supply curve is caused by a change in a good’s own price.
Topic: Supply in Product / Output Markets
Skill: Conceptual
AACSB: Reflective Thinking
Learning Outcome: Micro–12
42) A technological advance in the production of MP3 players will cause the equilibrium selling price to
increase.
Topic: Supply in Product / Output Markets
Skill: Conceptual
AACSB: Reflective Thinking
Learning Outcome: Micro–12
43) An increase in the wage rate of steel workers will reduce the supply of steel.
Topic: Supply in Product / Output Markets
Skill: Conceptual
AACSB: Reflective Thinking
Learning Outcome: Micro–12
44) Quantity supplied is determined by how much producers are willing and able to produce.
Topic: Supply in Product / Output Markets
Skill: Conceptual
AACSB: Reflective Thinking
Learning Outcome: Micro–12
45) A movement along the supply curve is caused by a change in a good‘s own price.
Topic: Supply in Product / Output Markets
Skill: Conceptual
AACSB: Reflective Thinking
Learning Outcome: Micro–12
53
46) A technological advance in the production of digital video recorders will cause them to become less
expensive.
Topic: Supply in Product / Output Markets
Skill: Conceptual
AACSB: Reflective Thinking
Learning Outcome: Micro–12
47) An increase in the wage rate of diamond cutters will increase the supply of cut diamonds.
Topic: Supply in Product / Output Markets
Skill: Conceptual
AACSB: Reflective Thinking
Learning Outcome: Micro–12
48) Supply is determined by how much suppliers are willing and able to produce.
Answer: FALSE
Diff: 1
Topic: Supply in Product / Output Markets
Skill: Conceptual
AACSB: Reflective Thinking
Learning Outcome: Micro–12
3.5 Market Equilibrium
1) Equilibrium is the condition that exists
A) whenever there is no government intervention in the market.
B) when the demand curve intersects the price axis.
C) when quantity demanded equals quantity supplied.
D) when the demand curve intersects the quantity axis.
Topic: Market Equilibrium
Skill: Definition
Learning Outcome: Micro-4
54
Refer to the information provided in Table 3.1 below to answer the question(s) that follow.
Table 3.1
Price per Pizza
Quantity Demanded
(Pizzas per Month)
Quantity Supplied
(Pizzas per Month)
$3
1,200
600
6
1,000
700
9
800
800
12
600
900
15
400
1,000
2) Refer to Table 3.1. This market will be in equilibrium if the price per pizza is
A) $6.
B) $9.
C) $12.
D) $15.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
3) Refer to Table 3.1. If the price per pizza is $12, the price will
A) remain constant because the market is in equilibrium.
B) increase because there is an excess demand in the market.
C) decrease because there is an excess demand in the market.
D) decrease because there is an excess supply in the market.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
4) Refer to Table 3.1. If the price per pizza is $15, there is a(n)
A) market equilibrium.
B) excess demand of 400 units.
C) excess demand of 900 units.
D) excess supply of 600 units.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
55
5) Refer to Table 3.1. If the price per pizza is $6, there is an excess
A) demand of 300 pizzas.
B) demand of 600 pizzas.
C) supply of 700 pizzas.
D) supply of 1,000 pizzas.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
6) Refer to Table 3.1. In this market there will be an excess demand of 300 pizzas at a price of
A) $6.
B) $9.
C) $12.
D) $15.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
7) Refer to Table 3.1. In this market there will be an excess supply of 300 pizzas at a price of
A) $6.
B) $9.
C) $12.
D) $15.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
8) Refer to Table 3.1. If the price per pizza is $3, the price will
A) remain constant because the market is in equilibrium.
B) increase because there is an excess demand in the market.
C) increase because there is an excess supply in the market.
D) decrease because there is an excess supply in the market.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
56
9) Refer to Table 3.1. This market will be in equilibrium if the quantity of pizzas supplied per month is
A) 700.
B) 750.
C) 800.
D) 900.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
10) Refer to Table 3.1. If the price per pizza is $3, the price will
A) remain constant because the market is in equilibrium.
B) increase because there is an excess supply in the market.
C) increase because there is an excess demand in the market.
D) decrease because there is an excess supply in the market.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
11) Refer to Table 3.1. If the price per pizza is greater than $15, there would most likely be a(n)
A) excess supply of more than 600 units.
B) quantity supplied of less than 1,000 units.
C) excess demand of less than 400 units.
D) quantity demanded of more than 400 units.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
12) Refer to Table 3.1. If the price per pizza is $12, there is an excess
A) demand of 400 pizzas.
B) demand of 600 pizzas.
C) supply of 300 pizzas.
D) supply of 900 pizzas.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
57
13) Refer to Table 3.1. In this market there will be an excess demand of 600 pizzas at a price of
A) $3.
B) $6.
C) $12.
D) $15.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
14) Refer to Table 3.1. In this market there will be an excess supply of 600 pizzas at a price of
A) $3.
B) $6.
C) $12.
D) $15.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
15) Refer to Table 3.1. If the price per pizza is $9, the price will
A) remain constant because the market is in equilibrium.
B) increase because there is an excess demand in the market.
C) increase because there is an excess supply in the market.
D) decrease because there is an excess supply in the market.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
58
Refer to the information provided in Table 3.2 below to answer the question(s) that follow.
Table 3.2
Price per
Cheeseburger
Quantity Demanded
(Cheeseburgers per Month)
Quantity Supplied
(Cheeseburgers per Month)
$5
1,500
500
6
1,200
700
7
900
900
8
600
1,100
9
300
1,300
16) Refer to Table 3.2. This market will be in equilibrium if the price per cheeseburger is
A) $5.
B) $6.
C) $7.
D) $8.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
17) Refer to Table 3.2. If the price per cheeseburger is $6, the price will
A) remain constant because the market is in equilibrium.
B) decrease because there is an excess demand in the market.
C) increase because there is an excess demand in the market.
D) decrease because there is an excess supply in the market.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
18) Refer to Table 3.2. If the price per cheeseburger is $9, there is a(n)
A) market equilibrium.
B) excess demand of 500 units.
C) excess demand of 300 units.
D) excess supply of 1,000 units.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
59
19) Refer to Table 3.2. If the price per cheeseburger is $5, there is an excess
A) demand of 300 cheeseburgers.
B) supply of 500 cheeseburgers.
C) demand of 1,000 cheeseburgers.
D) supply of 2,000 cheeseburgers.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
20) Refer to Table 3.2. In this market there will be an excess demand of 500 cheeseburgers at a price of
A) $5.
B) $6.
C) $7.
D) $8.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
21) Refer to Table 3.2. In this market there will be an excess supply of 500 cheeseburgers at a price of
A) $5.
B) $6.
C) $8.
D) $9.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
22) Refer to Table 3.2. If the price per cheeseburger is $7, the price will
A) remain constant because the market is in equilibrium.
B) increase because there is an excess demand in the market.
C) increase because there is an excess supply in the market.
D) decrease because there is an excess supply in the market.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
60
23) Refer to Table 3.2. This market will be in equilibrium if the quantity of cheeseburgers demanded is
A) 300.
B) 600.
C) 900.
D) 1,200.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
24) Refer to Table 3.2. If the price per cheeseburger is $5, the price will
A) remain constant because the market is in equilibrium.
B) decrease because there is an excess demand in the market.
C) increase because there is an excess demand in the market.
D) decrease because there is an excess supply in the market.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
25) Refer to Table 3.2. If the price per cheeseburger is $6, there is a(n)
A) market equilibrium.
B) excess demand of 1,000 units.
C) excess demand of 500 units.
D) excess supply of 700 units.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4
26) Refer to Table 3.2. If the price per cheeseburger is $8, there is an excess
A) demand of 600 cheeseburgers.
B) supply of 500 cheeseburgers.
C) demand of 300 cheeseburgers.
D) supply of 1,100 cheeseburgers.
Topic: Market Equilibrium
Skill: Analytical
AACSB: Analytical Thinking
Learning Outcome: Micro-4