88) In 2014, the price of peanuts was rising, which lead peanut butter sellers and peanut butter
buyers to expect the price of peanut butter would rise in the future. In the current market for
peanut butter, the price falls and the quantity decreases. This set of results means that
A) supply decreased by more than demand increased.
B) demand increased by more than supply decreased.
C) demand increased by more than supply increased.
D) supply decreased by more than demand decreased.
89) In 2014, the price of peanuts was rising, which lead peanut butter sellers and peanut butter
buyers to expect the price of peanut butter would rise in the future. In the current market for
peanut butter, the price rises and the quantity increases. This set of results means that
A) demand increased by more than supply decreased.
B) supply decreased by more than demand increased.
C) demand increased by more than supply increased.
D) supply decreased by more than demand decreased.
90) All shredded wheat producers have decided to add a new ingredient to shredded wheat, the
“crunch enhancer.” Crunch enhancer keeps cereals crisper longer in milk and, as a result,
consumers decide they like shredded wheat more than before. What happens to the supply and
demand curves for shredded wheat now that is costs more to produce and consumers like it
better?
A) The supply and demand curves both shift rightward.
B) The supply curve shifts rightward and the demand curve doesn’t shift.
C) The supply curve shifts leftward and the demand curve shifts rightward.
D) The supply curve shifts leftward and the demand curve doesn’t shift.
91) An increase in the demand for computers and a decrease in the number of sellers of
computers will definitely ________.
A) increase the number of computers bought
B) increase the price of a computer
C) increase the price of a computer and the number of computers bought
D) not change the price of a computer and increase the number of computers bought
92) Consider gardening books. What will happen to the market for these books as gardening
becomes more popular and simultaneously printing costs increase?
A) The price of gardening books definitely increases.
B) The quantity of gardening books definitely increases.
C) The price of gardening books might increase or decrease.
D) The quantity of gardening books definitely stays the same.
93) If the demand curve for bottled water shifts rightward and the supply curve of bottled water
shifts leftward, the equilibrium
A) price of bottled water definitely increases.
B) price of bottled water definitely decreases.
C) quantity of bottled water definitely increases.
D) quantity of bottled water definitely decreases.
94) The cost of producing aspirin increases simultaneously as doctors find that one aspirin per
day reduces the risk of heart attacks. The supply of aspirin ________ and the demand for aspirin
________ so that the equilibrium price of aspirin ________.
A) increases; increases; rises
B) decreases; increases; rises
C) increases; decreases; might rise, fall, or stay the same
D) decreases; increases; might rise, fall, or stay the same
95) All grapefruit juice producers have decided to blend tangerine juice with the grapefruit juice.
This blend results in a higher cost of production, but studies show that consumers prefer the taste
of the blend to straight grapefruit juice. What will happen to the equilibrium price and quantity
of the new “blended” grapefruit juice now that it costs more to produce but consumers like it
better?
A) The price rises and the quantity increases.
B) The price falls and the quantity increases.
C) The effect on the price is uncertain but the quantity increases.
D) The price rises, but the effect on the quantity is uncertain.
96) Which of the following always lowers the equilibrium price?
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
97) The equilibrium price will fall and the equilibrium quantity might increase, decrease, or stay
the same when the
A) demand and the supply of a good both increase.
B) demand for a good increases and the supply of it decreases.
C) demand for a good decreases and the supply of it increases.
D) demand and the supply of a good both decrease.
98) If the demand curve for bikes shifts leftward and the supply curve for bikes shifts rightward,
the equilibrium
A) price of bikes definitely increases.
B) price of bikes definitely decreases.
C) quantity of bikes definitely increases.
D) quantity of bikes definitely decreases.
Price
(dollars
per ride)
Quantity
demanded
(rides per day)
Quantity
supplied
(rides per day)
2
100
40
4
90
50
6
80
60
8
70
70
10
60
80
12
50
90
99) The table gives the demand and supply schedules for boat rides. If the supply of boat rides
increases by 20 rides a day, the price will ________.
A) remain unchanged
B) fall to $6 a ride
C) rise to $6 a ride
D) rise to $10 a ride
100) The figure illustrates the demand for and supply for jeans. Suppose jeans are a normal good
and people’s incomes increase. At the initial price of $50 for a pair of jeans, after the increase in
income the quantity demanded is ________ than the equilibrium quantity and there is a
________ of jeans.
A) greater; surplus
B) greater; shortage
C) less; surplus
D) less; shortage
101) The figure illustrates the market for chairs. If the supply of chairs increases, the price of a
chair ________ $40 and the quantity ________.
A) will rise above; demanded will decrease
B) will rise above; supplied will increase
C) will fall below; demanded will increase
D) will fall below; demanded will decrease
102) The above figure shows the market for pizza. Which figure shows the effect of a decrease in
the price of a hamburger, which for consumers is a substitute for pizza?
A) Figure A
B) Figure B
C) Figure D
D) Figures B and C
103) The above figure shows the market for pizza. Which figure shows the effect of an increase
in the price of a complement such as soda?
A) Figure A
B) Figure B
C) Figure C
D) Figure D
104) The above figure shows the market for pizza. Which figure shows the effect of an increase
in the price of sandwiches, which for consumers are substitutes for pizza?
A) Figure A
B) Figure B
C) Figure C
D) Figure D
105) The above figure shows the market for pizza. Which figure shows the effect of an increase
in the price of the tomato sauce used to produce pizza?
A) Figure A
B) Figure B
C) Figure C
D) Figure D
106) The above figure shows the market for pizza. Which figure shows the effect of a new report
by the U.S. Surgeon General that eating pizza lowers cholesterol levels, an outcome many people
want?
A) Figure A
B) Figure B
C) Figure C
D) Figure D
107) The above figure shows the market for hamburger. Which figure shows the effect of an
announcement by the U.S. Food and Drug Administration (FDA)that eating hamburger causes
early death?
A) Figure A
B) Figure B
C) Figure C
D) Figure D
108) The above figure shows the market for hamburger. Which panel shows the effect of a
drought in “cattle country”?
A) Figure A
B) Figure B
C) Figure C
D) Figure D
109) The above figure shows the market for hamburger. Which panel shows the effect of a new
excise tax on all beef products?
A) Figure A
B) Figure B
C) Figure C
D) Figure D
110) The above figures show the market for hamburger meat. Which figure(s) shows the effect
of a new report by the U.S. Surgeon General that beef consumption is healthier than previously
believed?
A) Figure A
B) Figure B
C) Figure D
D) Figure A and B
111) The above figures show the market for hamburger meat. Which figure(s) shows the effect
of an increase in the price of a hamburger bun, a complement for hamburger meat?
A) Figure B
B) Figure C
C) Figure D
D) Figures A and B
112) The above figures show the market for hamburger meat. Which figure(s) shows the effect
of an increase in the number of people who eat hamburger meat?
A) Figure A
B) Figure B
C) Figure C
D) Figures A and C
113) The above figures show the market for hamburger meat. Which figure(s) shows the effect
of a decrease in the price of a hamburger complement such as hamburger buns?
A) Figure A
B) Figure B
C) Figure D
D) Figures A and B
114) The above figures show the market for hamburger meat. Which figure(s) shows the effect
of an increase in the price of a substitute like hot dogs?
A) Figure A
B) Figure C
C) Figure D
D) Figures A and C
115) The above figures show the market for hamburger meat. Which figure shows the effect of a
decrease in the price of a substitute like hot dogs?
A) Figure A
B) Figure B
C) Figure C
D) Figure D
116) The above figures show the market for hamburger meat. Which figure(s) shows the effect
of a nation-wide strike by butchers and meat-packers?
A) Figure B
B) Figure C
C) Figure D
D) Figures B and C
117) The above figures show the market for hamburger meat. Which figure shows the effect of a
newly invented machine which grinds beef at twice the speed previously possible?
A) Figure A
B) Figure B
C) Figure C
D) Figure D
118) The above figures show the market for hamburger meat. Which figure shows the effect
when more farmers decide to raise cows that are processed into hamburger meat?
A) Figure A
B) Figure B
C) Figure C
D) Figure D
119) The above figures show the market for gasoline. Which figure shows the effect of a nation-
wide strike by municipal bus drivers, which causes more people to drive their cars to work?
A) Figure A
B) Figure B
C) Figure C
D) Figure D
120) The above figures show the market for gasoline. Which figure shows the effect of an
increased preference for cars that are smaller and more fuel efficient?
A) Figure A
B) Figure B
C) Figure C
D) Figure D
121) The above figures show the market for gasoline. Which figure shows the effect of motorists
increasing the number of times they take the bus to work rather than driving their own cars?
A) Figure A
B) Figure B
C) Figure C
D) Figure D
122) The above figures show the market for gasoline. Which figure(s) shows the effect of a
decision by the OPEC countries in the Middle East to export less oil to the rest of the world?
A) Figure B
B) Figure C
C) Figure D
D) Figures B and C
123) The above figures show the market for gasoline. Which figure(s) shows the effect of a
freezing cold winter which drives up the price of home heating oil (a substitute in production for
gasoline because each is made from crude oil)?
A) Figure B
B) Figure C
C) Figure D
D) Figures B and C
124) The above figures show the market for gasoline. Which figure(s) shows the effect of a new
U.S. tax on oil that suppliers must pay?
A) Figures A and C
B) Figures B and D
C) Figure A only
D) Figure C only
125) The above figures show the market for gasoline. Which figure shows the effect of the end
of a nine month strike by workers at all U.S. oil refineries?
A) Figure A
B) Figure B
C) Figure C
D) Figure D
126) The above figures show the market for oranges. Which figure shows the effect of changing
consumer preferences for more orange juice and less coffee in the morning?
A) Figure A
B) Figure B
C) Figure C
D) Figure D
127) The above figures show the market for oranges. Which figure(s) shows the effect of a new
government program that provides each public school child with an orange to start the day?
A) Figure A
B) Figure D
C) Figures A and C
D) Figures A and D
128) The above figures show the market for oranges. Which figure(s) shows the effect of an
increase in the price of bananas, a substitute for oranges?
A) Figure A
B) Figure C
C) Figure D
D) Figure A and C
129) The above figures show the market for oranges. Which figure(s) shows the effect of new
successful advertising campaigns to eat more oranges?
A) Figure A
B) Figure B
C) Figure D
D) Figures A and D
130) The above figures show the market for oranges. Which figure(s) shows the effect of a
nation-wide consumer boycott of eating oranges?
A) Figure B
B) Figure C
C) Figures B and C
D) Figures A and D
131) The above figures show the market for oranges. Which figure shows the effect of great
growing conditions that produce an above-average sized crop?
A) Figure A
B) Figure B
C) Figure C
D) Figure D
132) The above figures show the market for oranges. Which figure shows the effect of a new
technology called “the orange picker,” which harvests oranges less expensively than ever before?
A) Figure A
B) Figure B
C) Figure C
D) Figure D
133) The above figures show the market for oranges. Which figure(s) shows the effect of
existing orange growers increasing the size of their orange groves?
A) Figures A and C
B) Figures B and D
C) Figure A
D) Figure D
The Market for Wapanzo Beans
Quantity Demanded Price Quantity Supplied
(millions of pounds (dollars per (millions of pounds
per year) pound) per year)
Case
1
Case
2
Case
3
Case A
Case B
Case C
15
10
15
$1
1
2
3
12
8
4
$2
2
4
6
9
6
3
$3
3
6
9
6
3
2
$4
4
8
12
3
2
1
$5
5
10
15
134) Refer to the table above. Suppose that in normal years demand is represented by Case 2 and
supply is represented by Case B. In a normal year the price of wapanzo beans will be
A) $1 per pound.
B) $2 per pound.
C) $3 per pound.
D) $4 per pound.
135) Refer to the table above. Suppose that in normal years demand is represented by Case 2 and
supply is represented by Case B. In a normal year the equilibrium quantity of wapanzo beans
will be
A) 2 million pounds.
B) 4 million pounds.
C) 6 million pounds.
D) 8 million pounds.
136) Refer to the table above. Suppose that in normal years demand is represented by Case 2 and
supply is represented by Case B. If there is a drought in the wapanzo bean growing region then
supply will ________ and demand will ________.
A) become case A; become case 1
B) become case A; stay at case 2
C) stay at case B; become case 3
D) stay at case B; become case 1
137) Refer to the table above. Suppose that in normal years demand is represented by Case 2 and
supply is represented by Case B. If there is exceptionally good growing weather in the wapanzo
bean growing region then supply will ________ and demand will ________.
A) become case C; become case 1
B) become case C; stay at case 2
C) become case C; become case 3
D) stay at case B; become case 1
138) Refer to the table above. Suppose that in normal years demand is represented by Case 2 and
supply is represented by Case B. If it is discovered that wapanzo beans help prevent cancer, then
supply will ________ and demand will ________.
A) become case C; become case 1
B) become case C; stay at case 2
C) stay at case B; become case 1
D) become case A; become case 1
139) In the above figure, a change in quantity demanded with unchanged demand is represented
by a movement from
A) point a to point e.
B) point a to point b.
C) point a to point c.
D) None of the above represent a change in the quantity demanded with an unchanged demand.
140) In the above figure, a change in quantity supplied with unchanged supply is represented by
a movement from
A) point a to point e.
B) point b to point a.
C) point e to point c.
D) point b to point e.