138.
Refer to the diagram, which shows demand and supply conditions in the competitive market for
product X. A shift in the demand curve from D0
to D1 might be caused by a(n)
A. decrease in income if X is an inferior good.
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139.
Refer to the diagram, which shows demand and supply conditions in the competitive market for
product X. Other things equal, a shift of the supply curve from S0 to S1 might be caused by a(n)
D. increase in the number of firms producing X.
140. If the supply and demand curves for a product both decrease, then equilibrium
A. quantity must fall and equilibrium price must rise.
141. If the supply of a product decreases and the demand for that product simultaneously
increases, then equilibrium
D. price and equilibrium quantity must both decline.
142. Assuming competitive markets with typical supply and demand curves, which of the
following statements is correct?
A. An increase in supply with a decrease in demand will result in an increase in price.
143.
Refer to the diagram, in which S1 and D1 represent the original supply and demand curves and
S2 and D2 the new curves. In this market
A. supply has decreased and equilibrium price has increased.
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144.
Refer to the diagram, in which S1 and D1 represent the original supply and demand curves and
S2 and D2 the new curves. In this market
A. the equilibrium position has shifted from M to K.
145.
Refer to the diagram, in which S1 and D1 represent the original supply and demand curves and
S2 and D2 the new curves. In this market the indicated shift in supply may have been caused by
A. an increase in the wages paid to workers producing this good.
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146.
Refer to the diagram, in which S1 and D1 represent the original supply and demand curves and
S2 and D2 the new curves. In this market the indicated shift in demand may have been caused
by
A. a decline in the number of buyers in the market.
147. In the following question you are asked to determine, other things equal, the effects of a
given change in a determinant of demand or supply for product X upon (1) the demand (D) for,
or supply (S) of, X; (2) the equilibrium price (P) of X; and (3) the equilibrium quantity (Q) of X.
If X is a normal good, an increase in income will
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D. decrease D, increase P, and increase Q.
148. In the following question you are asked to determine, other things equal, the effects of a
given change in a determinant of demand or supply for product X upon (1) the demand (D) for,
or supply (S) of, X; (2) the equilibrium price (P) of X; and (3) the equilibrium quantity (Q) of X.
An increase in the price of a product that is a close substitute for X will
A. decrease D, increase P, and decrease Q.
149. In the following question you are asked to determine, other things equal, the effects of a
given change in a determinant of demand or supply for product X upon (1) the demand (D) for,
or supply (S) of, X; (2) the equilibrium price (P) of X; and (3) the equilibrium quantity (Q) of X.
A decrease in the number of consumers of product X will
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A. decrease S, decrease P, and decrease Q.
150. In the following question you are asked to determine, other things equal, the effects of a
given change in a determinant of demand or supply for product X upon (1) the demand (D) for,
or supply (S) of, X; (2) the equilibrium price (P) of X; and (3) the equilibrium quantity (Q) of X.
An increase in the prices of resources used to produce X will
A. increase S, increase P, and increase Q.
151. In the following question you are asked to determine, other things equal, the effects of a
given change in a determinant of demand or supply for product X upon (1) the demand (D) for,
or supply (S) of, X; (2) the equilibrium price (P) of X; and (3) the equilibrium quantity (Q) of X.
An improvement in the technology used to produce X will
A. decrease S, increase P, and decrease Q.
B. decrease S, increase P, and increase Q.
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Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
C. increase S, decrease P, and increase Q.
D. decrease D, decrease P, and decrease Q.
152. In the following question you are asked to determine, other things equal, the effects of a
given change in a determinant of demand or supply for product X upon (1) the demand (D) for,
or supply (S) of, X; (2) the equilibrium price (P) of X; and (3) the equilibrium quantity (Q) of X.
A reduction in the number of firms producing X will
A. increase D, increase P, and increase Q.
153. In the following question you are asked to determine, other things equal, the effects of a
given change in a determinant of demand or supply for product X upon (1) the demand (D) for,
or supply (S) of, X; (2) the equilibrium price (P) of X; and (3) the equilibrium quantity (Q) of X.
An increase in the price of a product that is a complement to X will
A. decrease S, decrease P, and decrease Q.
154. In the following question you are asked to determine, other things equal, the effects of a
given change in a determinant of demand or supply for product X upon (1) the demand (D) for,
or supply (S) of, X; (2) the equilibrium price (P) of X; and (3) the equilibrium quantity (Q) of X.
If X is an inferior good, a decrease in income will
A. decrease D, decrease P, and decrease Q.
155. In the following question you are asked to determine, other things equal, the effects of a
given change in a determinant of demand or supply for product X upon (1) the demand (D) for,
or supply (S) of, X; (2) the equilibrium price (P) of X; and (3) the equilibrium quantity (Q) of X.
Consumer expectations that the price of X will rise sharply in the future will
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Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
A c c e s s i b i l i t y :
Keyboard Navigation
Blooms: Understand
Diff iculty:
02 Medium
Learning Objective: 03–05 Explain how changes in supply and demand affect equilibrium
prices and quantities.
Test Bank: I
Topic:
Changes in Supply, Demand, and Equilibrium
156. Data from the registrar’s office at Gigantic State University indicate that over the past 20
years tuition and enrollment have both increased. From this information we can conclude that
157. One can say with certainty that equilibrium price will decline when supply
158. Suppose that in 2007, Ford sold 500,000 Mustangs at an average price of $18,800 per car;
in 2008, 600,000 Mustangs were sold at an average price of $19,500 per car. These statements
159. Since their introduction, prices of Blu-ray players have fallen and the quantity purchased
has increased. This statement
160.
Which of the diagrams illustrates the effect of an increase in automobile worker wages on the
market for automobiles?
161.
Which of the diagrams illustrate(s) the effect of a decline in the price of personal computers on
the market for software?
162.
Which of the diagrams illustrate(s) the effect of a decrease in incomes on the market for second-
hand clothing?
163.
Which of the diagrams illustrates the effect of a governmental subsidy on the market for AIDS
research?
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164.
Which of the diagrams illustrate(s) the effect of a decline in the price of irrigation equipment on
the market for corn?
165. With a downsloping demand curve and an upsloping supply curve for a product, an
increase in consumer income will
D. reduce the quantity demanded but not shift the demand curve.
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Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
AACSB: Knowledge Application
A c c e s s i b i l i t y :
Keyboard Navigation
Blooms: Understand
Diff iculty:
02 Medium
Learning Objective: 03–05 Explain how changes in supply and demand affect equilibrium
prices and quantities.
Test Bank: I
Topic:
Changes in Supply, Demand, and Equilibrium
166. With a downsloping demand curve and an upsloping supply curve for a product, a decrease
in resource prices will
167. With a downsloping demand curve and an upsloping supply curve for a product, placing an
excise tax on this product will
A. increase equilibrium price and quantity.
168. Given a downsloping demand curve and an upsloping supply curve for a product, an
increase in the price of a substitute good (from the buyer’s perspective) will
169. (Advanced analysis) The demand for commodity X is represented by the equation P = 10 –
0.2Q and supply by the equation P = 2 + 0.2Q. The equilibrium quantity is
170. (Advanced analysis) The demand for commodity X is represented by the equation P = 10 –
0.2Q and supply by the equation P = 2 + 0.2Q. The equilibrium price for X is
A. $2.