• 1. 
    Which of the following correctly describes a change in quantity demanded and a change in demand?

  • A change in quantity demanded is a response to a price change and a change in demand is a response to a non-price change
  • A change in demand and a change in quantity demanded both happen in response to price changes
  • Both describe a movement along a single demand curve
  • The two terms can be used interchangeably
  • A change in quantity demanded occurs when price increases and a change in demand occur when a price decreases
  • 2. 
    Ramen noodles are a staple food item for many college students. Ramen noodles are very inexpensive, easy to prepare, and can be combined easily with other foods. After students graduate, find employment, and earn a higher income, they decrease their Ramen noodle purchases significantly. In this case, Ramen noodles are:

  • a normal good
  • an inferior good
  • a complement for higher income people
  • none of these are correct
  • 3. 
    When the price of Nike soccer balls fell, Ronaldo purchased more Nike soccer balls, and fewer Adidas soccer balls. Which of the following best explains Ronaldo's decision to buy more Nike soccer balls?

  • the substitution effect
  • the income effect
  • an increase in the demand for Nike soccer balls
  • the price effect
  • 4. 
    If the demand for digital cameras increases when consumers' incomes rise, then digital cameras are

  • a normal good
  • an inferior good
  • a substitute good
  • a complement to video cameras
  • 5. 
    If the demand for used cars decreases after the price of a new car falls, used cars and new cars are

  • inferior goods
  • substitute goods
  • complementary goods
  • normal goods
  • 6. 
    If the demand for a good increases when people's incomes increase,

  • the good is an inferior good
  • the law of demand is violated
  • the good's demand curve must be upward sloping
  • the good is a normal good
  • 7. 
    Market demand curves are obtained by

  • determining the price each consumer is willing to pay for the good & summing those prices across all consumers
  • observing the prices and quantities sold in a market over time and plotting those price-quantity combinations in a graph
  • summing the quantities every consumer is willing to buy at each different price
  • observing the behavior of an individual consumer in a market
  • 8. 
    A. If a person is willing to purchase a product but is not able to purchase it. B. If a person is able to purchase a certain quantity of a product but is not willing to purchase it

  • Both are considered as Demand
  • (A) is demand while (B) is not
  • (B) is demand while (A) is not
  • Both cannot be considered as Demand
  • 9. 
    Iceberg & romaine are two different types of lettuce. For most consumers, iceberg and romaine are

  • complements
  • substitutes
  • inferior goods
  • resources
  • 10. 
    A new study has shown that avocados are extremely healthy. The demand for avocados has increased due to a change in

  • market size
  • price of a substitute good
  • price of a complementary good
  • tastes and preferences
  • 11. 
    The law of demand refers to how

  • demand changes when people's incomes change
  • demand changes when the prices of substitutes and complements change
  • the quantity demanded changes when the price of the good changes
  • the price of the good changes when people's demand for the good changes
  • 12. 
    Due to a disappointing economy, Americans are cutting back on the family vacation road trips. What happens to the market for gasoline?

  • Demand for gasoline will decrease
  • Demand for gasoline will increase
  • Demand for gasoline will stay the same
  • 13. 
    To access Internet services, consumers must use a computer. If computer prices fall, what is the effect on the demand for Internet services

  • the demand for Internet services increases
  • the demand for Internet services decreases
  • The demand for Internet services remains unchanged
  • The demand for Internet services could increase, decrease, or stay the same depending on other factors
  • 14. 
    The diagram represents a

  • increase in demand
  • decrease in demand
  • 15. 
    A change in the demand for apples could result from any of the following except

  • a change in the number of buyers
  • increased preferences for fresh fruit consumption for health reasons
  • a change in the price of an apple
  • a change in the price of a banana
  • 16. 
    Price goes on ________

  • the vertical axis
  • the horizontal axis
  • at the origin
  • the z axis
  • 17. 
    Somethings have changed about how consumers buy hats, which has resulted in the change shown in the graph shown here. Which of the following changes could this graph represent?

  • People like hats more than they did before, and their demand for hats has increased because of this
  • There has been a decrease in the price of hats, resulting in an increase in the quantity demanded for hats
  • People do not like hats as they did before, so their demand has decreased
  • People do not like hats as they did before, resulting in a movement along the demand curve
  • 18. 
    Consider the market for cellular phones. Which of the following shifts the demand curve leftward?

  • studies showing using cellular phones can cause brain cancer
  • a decrease in the price of cellular phones
  • a decrease in the quantity demanded of cellular phones
  • an increase in the services provided by cellular phones, such as text messaging
  • 19. 
    The law of demand states that

  • price and quantity demanded are inversely related
  • the larger the number of buyers in a market, the lower will be product price
  • price and quantity demanded are directly related
  • consumers will buy more of a product at high prices than at low prices
  • 20. 
    Desire, Capacity and Willingness gives rise to___________

  • Need
  • Want
  • Demand
  • All of the Above
  • 21. 
    Giffen Goods are those, the demand for which

  • Decreases with the fall in Income
  • Increases with the rise in Income
  • Decreases with the rise in Income
  • None of the Above
  • 22. 
    If Mary used to buy 10 units at $4 each and now buys 15 units when the price is $4, her

  • quantity demanded has increased
  • quantity demanded has decreased
  • demand has increased
  • demand has decreased
  • 23. 
    The law of demand says that when the price of a product rises, the quantity demanded decreases. Why do people buy fewer CDs if the price of a CD rises?

  • When the price rises, people get less pleasure from listening to music
  • If CDs become more expensive, people switch to relatively less expensive alternative goods, such as cassette tapes
  • Higher prices just turn people off
  • Because CDs are a normal good
  • 24. 
    The phrase "a change in demand" most directly implies a

  • movement along the curve
  • movement along the price curve
  • change in quantity demanded of a good
  • shift in the demand curve
  • 25. 
    When the price of a product increases, a consumer is able to buy less of it with a given money income. This describes:

  • the cost effect
  • the inflationary effect
  • the income effect
  • the substitution effect
  • 26. 
    Consider the market for cars in Hong Kong. If the price of gasoline increases then the Demand for cars will

  • increase
  • decrease
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