practice exam
Practice Supply and Demand Questions
1. If the price of chocolate-covered peanuts increases from 40 cents to 50 cents, Dan will reduce his quantity demanded from 160 bags to 140 bags due to:
a) The law of demand
b) The law of supply
c) A decline in his income
d) A change in his tastes and preferences
2. An increase in demand, all other things unchanged, will result in a(n)_______ in price and a(n)_______ in quantity.
a) Increase; decrease
b) Decrease; decrease
c) Decrease; increase
d) Increase; increase
3. There is an increase in incomes. What happens in the market steak?
a) The equilibrium price falls, and the equilibrium quantity rises
b) The equilibrium price rises, and the equilibrium quantity falls
c) The equilibrium price and quantity rise
d) The equilibrium price and quantity fall
4. The price of oranges rises. What happens in the market for apples, which are a substitute for oranges?
a) The equilibrium price falls, and the equilibrium quantity rises
b) The equilibrium price rises, and the equilibrium quantity falls
c) The equilibrium price and quantity rise
d) The equilibrium price and quantity fall
5. Other things being equal, the effect of a decrease in the price of Coca-Cola would cause which of the following?
a) A rightward shift in the demand curve for Coca-Cola
b) A downward movement along the demand curve for Coca-Cola
c) A leftward shift in the demand curve for Coca-Cola
d) An upward movement along the demand curve for Coca-Cola
6. Assuming compact discs and cassettes are substitute goods, a decrease in the price of cassettes will cause the demand curve for compact discs to:
a) Shift to the left as consumers switch from buying discs to cassettes
b) Shift to the right as consumers switch from buying discs to cassettes
c) Shift to the left as producers increase cassettes production and reduce disc production
d) Remain unchanged since discs and cassettes are sold in separate markets
7. If the price of potato chips
1. If the price of chocolate-covered peanuts increases from 40 cents to 50 cents, Dan will reduce his quantity demanded from 160 bags to 140 bags due to:
a) The law of demand
b) The law of supply
c) A decline in his income
d) A change in his tastes and preferences
2. An increase in demand, all other things unchanged, will result in a(n)_______ in price and a(n)_______ in quantity.
a) Increase; decrease
b) Decrease; decrease
c) Decrease; increase
d) Increase; increase
3. There is an increase in incomes. What happens in the market steak?
a) The equilibrium price falls, and the equilibrium quantity rises
b) The equilibrium price rises, and the equilibrium quantity falls
c) The equilibrium price and quantity rise
d) The equilibrium price and quantity fall
4. The price of oranges rises. What happens in the market for apples, which are a substitute for oranges?
a) The equilibrium price falls, and the equilibrium quantity rises
b) The equilibrium price rises, and the equilibrium quantity falls
c) The equilibrium price and quantity rise
d) The equilibrium price and quantity fall
5. Other things being equal, the effect of a decrease in the price of Coca-Cola would cause which of the following?
a) A rightward shift in the demand curve for Coca-Cola
b) A downward movement along the demand curve for Coca-Cola
c) A leftward shift in the demand curve for Coca-Cola
d) An upward movement along the demand curve for Coca-Cola
6. Assuming compact discs and cassettes are substitute goods, a decrease in the price of cassettes will cause the demand curve for compact discs to:
a) Shift to the left as consumers switch from buying discs to cassettes
b) Shift to the right as consumers switch from buying discs to cassettes
c) Shift to the left as producers increase cassettes production and reduce disc production
d) Remain unchanged since discs and cassettes are sold in separate markets
7. If the price of potato chips