Title: Supply
Course: TEST Course

Q: Economists refer to the relationship that a higher price leads to a higher quantity supplied as the
- market equilibrium.
- price and supply model.
- law of supply.
A: law of supply.

Q: When higher prices result in higher quantity supplied, economists call this relationship
- the supply curve.
- price and supply model.
- the law of supply.
A: the law of supply.

Q: According to the law of supply, assuming other factors are held constant
- as the price of bread increases, the quantity of bread supplied will decrease.
- as the supply for bread increases, the price of bread will also increase.
- as the price of bread increases, the quantity of bread supplied will increase.
A: as the price of bread increases, the quantity of bread supplied will increase.

Q: According to the law of supply, assuming other factors are held constant
- as the price of milk increases, the quantity of milk supplied will decrease.
- as the supply for milk increases, the price of milk will also increase.
- as the price of milk decreases, the quantity of milk supplied will decrease.
A: as the price of milk decreases, the quantity of milk supplied will decrease.

Q: The owner of a paper manufacturer in Seattle, WA is planning next month’s production goals. Last month the price of a ton of paper was $625, which increased to $840 this month. According to the law of supply, what would be a rational response of the owner to this change in market price for paper?
- Shut down 2 out of the 4 paper pulp machines at the plant.
- Layoff workers and reduce output.
- Hire additional workers and increase output.
A: Hire additional workers and increase output.

Q: The operations vice president is adjusting the production quantities for the upcoming month of March for the coal company. Last month the price of a ton of coal was $45, and in February it increased to $64 per ton. According to the law of supply, what would be a rational response of the VP of operations in adjusting his coal output with the change in the market price?
- Shut down 2 out of the 4 mining sections in the coal mine.
- Reduce output and layoff workers.
- Increase output and hire more workers.
A: Increase output and hire more workers.

Q: In December there is a large demand for evergreen trees. They are sold on city corners and parking lots for Christmas. According to the law of supply, what scenario would you expect to see with the Christmas trees?
- There are bargains and sales in most places selling the trees in order to stimulate demand.
- The demand is decreases in December, so the tree lots are decreasing the number of trees supplied.
- The supply and prices of the trees have increased since October.
A: The supply and prices of the trees have increased since October.

Q: It is the end of the year and party supply stores have added the things needed for a fantastic New Years Eve party. According to the law of supply, what scenario would you expect to see with the party supply stores?
- There are bargains and sales in most places selling the New Year’s supplies to stimulate demand.
- The demand is decreasing in December, so New Year’s party supply stores are decreasing the number of New Year's party supplies.
- The supply and prices of the New Year’s party supplies have increased since November.
A: The supply and prices of the New Year’s party supplies have increased since November.

Q: A supply curve is a graphical illustration of the relationship between price and
- demand.
- quantity demanded.
- quantity supplied.
A: quantity supplied.

Q: A supply curve is a graphical illustration of the relationship between quantity supplied and
- demand.
- quantity demanded.
- price.
A: price.

Q: When economists talk about supply, they are referring to a relationship between the price in a market and the
- equilibrium quantity.
- amount that buyers wish to purchase.
- amount that producers collectively make available for sale.
A: amount that producers collectively make available for sale.

Q: The relationship between the price in a market and the amount that producers collectively make available for sale, is referred to as
- equilibrium quantity.
- quantity supplied.
- supply.
A: supply.

Q: Nearly all supply curves share a basic similarity. They slope
- down from left to right.
- up from right to left.
- up from left to right.
A: up from left to right.

Q: In general, supply curves slope
- downward from left to right.
- upward from right to left.
- upward from left to right.
A: upward from left to right.

Q: Coilmaster Corporation, a machine shop in Tennessee, produces a variety of parts for refrigerators. Recently they increased their prices and supply of parts. The new supply schedule for refrigerators parts is the table below. Which supply curve below has the correct slope of Coilmaster Corp’s parts supply schedule?

Supply and Price of Refrigerator Parts
Price ($) | Quantity Supplied
$400 | 50
$600 | 70
$700 | 90
$800 | 110
$900 | 130
$1,100 | 150
$1,200 | 170
- and ends at (1200,170).)
- and ends at (170,400).)
- and ends at (170,1200).)
A: and ends at (170,1200).)

Q: The regional soda company in Michigan, Faygo, has recently run viral advertisements online and has increased their prices and number of supplied sodas to regional grocery stores. The graph of Faygo’s supply schedule is shown below.

and ends at (170,1200).) Which supply schedule is correct for creating Faygo’s soda supply curve graph?
- Supply and Price of Refrigerator Parts
Price ($) | Quantity Supplied
$400 | 70
$600 | 90
$700 | 110
$800 | 130
$900 | 150
$1,000 | 170
$1,200 | 190
- Price ($) | Quantity Supplied
$400 | 170
$600 | 150
$700 | 130
$800 | 110
$900 | 90
$1,000 | 70
$1,200 | 50
- Price ($) | Quantity Supplied
$400 | 50
$600 | 70
$700 | 90
$800 | 110
$900 | 130
$1,100 | 150
$1,200 | 170
A: Price ($) | Quantity Supplied
$400 | 50
$600 | 70
$700 | 90
$800 | 110
$900 | 130
$1,100 | 150
$1,200 | 170

Q: Looking at the graph, if price was $2.20 per gallon and decreased to $1.60 per gallon, how does quantity supplied of gasoline change?
- 640 million gallons to 720 million gallons
- 720 million gallons to 600 millions gallons
- 720 million gallons to 640 million gallons
A: 720 million gallons to 640 million gallons

Q: Looking at the graph, if price was $1.60 per gallon and increased to $2.20 per gallon, how does quantity supplied of gasoline change?
- 720 million gallons to 640 million gallons
- 600 million gallons to 720 millions gallons
- 640 million gallons to 720 million gallons
A: 640 million gallons to 720 million gallons

Q: Considering the graph for microchips

, if prices decrease from $200 to $150, suppliers will want to
- produce almost 70 more microchips.
- produce half as many microchips.
- produce nearly 70 fewer microchips.
A: produce nearly 70 fewer microchips.

Q: Considering the graph for microchips, if prices increase from $150 to $200, suppliers will want to
- produce nearly 70 fewer microchips.
- produce twice as many microchips.
- produce almost 70 more microchips.
A: produce almost 70 more microchips.

Q: Lian is a production analyst at the cardboard box manufacturer Flexpac. Last year, because of an increase in online shopping, shipping companies have increased the use of boxes for shipping. Management has charged Lian with generating a supply curve graph to illustrate the rise in price and supply of their boxes. These are the figures Lian discovered and put in a table. If you were assisting Lian, what steps would you tell her to take next?

Price ($) | Quantity Supplied
$100 | 100
$125 | 150
$150 | 200
$175 | 250
$200 | 280
$225 | 310
$250 | 350
- Plot these points as a demand curve graph sloping down to the right with price on the y-axis and quantity supplied on the x-axis.
- Plot these points on a graph with graph sloping up to the right quantity supplied on the y-axis and price on the x-axis.
- Plot these points on a graph sloping up to the right with price on the y-axis and quantity supplied on the x-axis.
A: Plot these points on a graph sloping up to the right with price on the y-axis and quantity supplied on the x-axis.

Q: Santiago is a new analyst working to create a supply curve graph. His boss at Legoland asked him to create one to highlight the historical relationship of the price of park tickets and the quantity supplied. Santiago put the identified ticket prices and quantities in a table. He is about to create the graph, but is double checking with you since you’ve created one before. Santiago has put the prices on the x-axis and the quantity supplied on the y-axis. What would you tell him to do next?

Price ($) | Quantity Supplied
$59 | 1000
$67 | 1500
$79 | 2000
$83 | 2500
$97 | 2800
$105 | 3100
$120 | 3500
- Plot these points as a demand curve graph sloping down to the right with price on the y-axis and quantity supplied on the x-axis.
- Plot these points on a graph with graph sloping up to the right keeping quantity supplied on the y-axis and price on the x-axis.
- Plot these points on a graph sloping up to the right with and change it to price on the y-axis and quantity supplied on the x-axis.
A: Plot these points on a graph sloping up to the right with and change it to price on the y-axis and quantity supplied on the x-axis.

Q: Frank has plotted the following points on a supply curve graph from the supply schedule for golf shoe market. Which of the following supply curves accurately reflects Frank’s supply schedule?
Golf Shoes
Price ($" style="max-width: 100%" />
Quantity Supplied

$55
1
$75
2
$100
3
$120
4
$135
5
$155
6
$195
7
- The orange line.
- The silver line.
- The yellow line.
A: The yellow line.

Q: and ends at (7,200). An upward sloping orange line starts at (1,100) and ends at (7,350). A third grey upward sloping line starts at (1,100) and ends at (7,375).) Frank has plotted his supply schedule on a supply curve graph for the golf shoe market. He has also plotted two other competitor’s supply schedules. Which of the following supply schedules accurately reflects Frank’s golf shoe market supply schedule if his business is the yellow supply curve?
- The correct supply schedule has the figures: $100,1 and $150,2 and $200,3 and $250,4 and $280,5 and $310,6 and $350,7.
- The correct supply schedule has the figures: $100,1 and $175,2 and $225,3 and $285,4 and $300,5 and $325,6 and $375,7.
- The correct supply schedule has the figures: $50,1 and $75,2 and $100,3 and $120,4 and $135,5 and $155,6 and $195,7.
A: The correct supply schedule has the figures: $50,1 and $75,2 and $100,3 and $120,4 and $135,5 and $155,6 and $195,7.

Q: A drought decreases the supply of agricultural products. This means that at any given price, a lower quantity will be supplied. Conversely, especially good weather would shift the
- demand curve to the right.
- supply curve to the left.
- supply curve to the right.
A: supply curve to the right.

Q: Good weather and heavy winter rain increases the supply of agricultural products. This means that at any given price, a higher quantity will be supplied. Conversely, a drought would shift the
- demand curve to the right.
- supply curve to the right.
- supply curve to the left.
A: supply curve to the left.

Q: A severe freeze has damaged the Florida orange crop. The impact on the market for orange juice will be a leftward shift of
- the demand curve.
- both the supply and demand curves.
- the supply curve.
A: the supply curve.

Q: Suppose Congress passes legislation that offers subsidies to orange farmers. The impact on the market for orange juice will be a rightward shift of
- the demand curve.
- both the supply and demand curves.
- the supply curve.
A: the supply curve.

Q: Which of the following would cause the supply curve to shift to the right?
- An increase in the price of the product.
- An increase in production costs.
- An improvement in technology.
A: An improvement in technology.

Q: The supply curve will shift to the right if which of the following occurs?
- A new tax imposed on the product.
- Unfavorable natural conditions.
- An improvement in technology.
A: An improvement in technology.

Q: Which of the following will shift the supply curve to the left?
- A change in consumer tastes and preferences.
- Government deregulation of production.
- An increase in the price of inputs to production.
A: An increase in the price of inputs to production.

Q: Which of the following will shift the supply curve to the right?
- A change in consumer tastes and preferences.
- Government regulation of production.
- A decrease in the price of inputs to production.
A: A decrease in the price of inputs to production.

Q: Which of the following will cause the supply curve to shift to the left?
- improved technology
- a fall in input prices
- higher product taxes
A: higher product taxes

Q: Which of the following will cause the supply curve to shift to the right?
- poor natural conditions for production
- an increase in input prices
- lower product taxes
A: lower product taxes

Q: A change in technology that reduces the costs of production will
- increase consumer demand.
- decrease consumer demand.
- shift the supply curve to the right.
A: shift the supply curve to the right.

Q: If a technology change reduces a company’s production costs, it will
- increase consumer demand.
- decrease consumer demand.
- shift the supply curve to the right.
A: shift the supply curve to the right.

Q: When ________, business firms will collectively supply a higher quantity of output at any given price, and the supply curve will shift to the right.
- prices rise
- there is a population increase
- costs of production fall
A: costs of production fall

Q: When ________, business firms will collectively supply a lower quantity of output at any given price, and the supply curve will shift to the left.
- prices decrease
- there is a population decrease
- costs of production increase
A: costs of production increase