Title: Demand
Course: TEST Course

Q: Economists refer to the relationship that a higher price leads to a lower quantity demanded as the
- production possibilities frontier.
- price and demand model.
- law of demand.
A: law of demand.

Q: When higher prices result in a lower quantity demanded, economists call this relationship
- the demand curve.
- the price and demand model.
- the law of demand.
A: the law of demand.

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

Q: According to the law of demand, assuming other factors are held constant
- As the price of milk increases, the quantity of milk demanded will increase.
- As the demand for milk increases, the price of milk will also increase.
- As the price of milk decreases, the quantity of milk demanded will increase.
A: As the price of milk decreases, the quantity of milk demanded will increase.

Q: The law of demand states that as the price of a good increases,
- more of it is produced.
- suppliers wish to sell less of it.
- buyers desire to purchase less of it.
A: buyers desire to purchase less of it.

Q: The law of demand states that as the price of a good decreases,
- less of it is produced.
- suppliers wish to sell more of it.
- buyers desire to purchase more of it.
A: buyers desire to purchase more of it.

Q: Miriam owns a small shop selling custom headbands and accessories. Last month, she sold 335 headbands for $10 each. According to the law of demand, what quantity might Miriam expect to sell if she drops the price to $6?
- 290
- 335
- 415
A: 415

Q: If a perfume store currently sells perfume for $30 a bottle and averages $2000 sales per month, what sales might they anticipate if they raise the price to $40 a bottle?
- $2000
- $2500
- $1500
A: $1500

Q: A demand curve shows the graphical relationship between price and
- quantity produced.
- costs.
- quantity demanded.
A: quantity demanded.

Q: A demand curve shows the graphical relationship between quantity demanded and
- quantity produced.
- costs.
- price.
A: price.

Q: The downward slope of a demand curve illustrates the pattern that as ________ rises, ________ decreases.
- price; quantity supplied
- quantity supplied; quantity demanded
- price; quantity demanded
A: price; quantity demanded

Q: The downward slope of a demand curve illustrates the pattern that as ________ decreases, ________ increases.
- price; quantity supplied
- quantity supplied; quantity demanded
- price; quantity demanded
A: price; quantity demanded

Q: According to this graph, what happens to quantity demanded if the price of a used car increases from $5000 to $7000?
- The quantity demanded increases to 1,000 cars.
- The quantity demanded drops to 3,100 cars.
- The quantity demanded drops to 1,000 cars.
A: The quantity demanded drops to 1,000 cars.

Q: According to this graph, what happens to quantity demanded if the price of a used car decreases from $4000 to $2000?
- The quantity demanded increases to 4,300 cars.
- The quantity demanded increases to 6,500 cars.
- The quantity demanded falls to 6,500 cars.
A: The quantity demanded falls to 6,500 cars.

Q: You are given this demand schedule for new boats. Which of the following demand curves accurately represents the demand schedule and has proper formatting? The demand schedule for new boats:

Price ($) | Quantity Demanded
$500 | 5500
$1000 | 5000
$1500 | 4500
$2000 | 3500
$2500 | 3000
$3000 | 2000
$3500 | 1000
$4000 | 150
A: (a choice with no text)

Q: You are given this demand schedule for new computers. Which of the following demand curves accurately represents the demand schedule and has proper formatting? The demand schedule for new computers:

Price ($) | Quantity Demanded
$500 | 5500
$1000 | 5000
$1500 | 4500
$2000 | 3500
$2500 | 3000
$3000 | 2000
$3500 | 1000
$4000 | 150
A: (a choice with no text)

Q: Analyze the following diagram:

If price was $2.00 per gallon and decreased to $1.40 per gallon, how does quantity of gasoline demanded change?
- 600 million gallons to 460 million gallons
- 460 million gallons to 700 millions gallons
- 460 million gallons to 600 million gallons
A: 460 million gallons to 600 million gallons

Q: Analyze the following diagram:

If price was $1.40 per gallon and increased to $2.00 per gallon, how does quantity of gasoline demanded change?
- 460 million gallons to 600 million gallons
- 460 million gallons to 700 millions gallons
- 600 million gallons to 460 million gallons
A: 600 million gallons to 460 million gallons

Q: Analyze the following diagram:

If the price was $3.00 per kilogram of oranges, and the price fell by $1.00, how does the quantity of oranges demanded change?
- 300 thousand kilograms to 250 thousand kilograms
- 260 thousand kilograms to 290 thousand kilograms
- 250 thousand kilograms to 300 thousand kilograms
A: 250 thousand kilograms to 300 thousand kilograms

Q: Analyze the following diagram:

If the price per kilogram of oranges was $2.10, and the price went up to $2.50 per kilogram, how many fewer thousand kilograms will be demanded?
- 5,000
- 10,000
- 20,000
A: 20,000

Q: Marcus is the chief data analyst of the U.S. Fish and Wildlife Service for the West Coast. There is a growing concern about the overfishing in the Pacific fisheries, and Marcus needs to estimate the demand curve for salmon as part of the agency’s mitigation efforts. From data already collected he sees that when the price of a freshly caught salmon is $400, the public will demand a quantity of 1 million fish. If the price is $215 then the public will demand 4 million fish. Finally, if the price was $50 consumers will demand a quantity of 8 million fish. Which curve below is the correct demand curve for Pacific salmon given these three data points?
- the blue curve
- the silver curve
- the orange curve
A: the orange curve

Q: Amka is the head analyst for the Alaska Department of Fish and Game Service. Recently the agency has become concerned about overfishing in the waters off Alaska. Amka is estimating the demand curve for salmon as part of the agency’s mitigation efforts. From past statistics she knows that when the price of a freshly caught salmon is $400, the public will demand a quantity of 1 million fish. If the price is $200 then the public will demand 5.6 million fish. Finally, if the price was $125 consumers will demand a quantity of 8 million fish. Which curve below could be the correct demand curve for Alaskan salmon given these three data points?
- the blue curve
- the orange curve
- the silver curve
A: the silver curve

Q: Which of the following graphs depicts the correct version of the data set representing the number and price of watches with price on the y-axis and quantity demanded on the x-axis?

Watches
Price ($) | Quantity Demanded
$300 | 10
$250 | 50
$200 | 100
$150 | 200
$100 | 300
$50 | 400
$25 | 500
$5 | 600
- and ends at 300,0)
- and ends at 650,0)
- and ends at 600,0)
A: and ends at 600,0)

Q: and ends at 600,0) Which of the following data sets depicts the correct version of the above quantity Demand graph representing the number and price of watches. The x-axis shows quantity and the y-axis shows price.
- Table 3
Quantity Demanded | Prices ($)
50 | $300
100 | $250
200 | $200
300 | $150
400 | $100
500 | $50
600 | $25
650 | $5
- Table 1
Prices ($) | Quantity Demanded
$10 | 300
$50 | 250
$100 | 200
$200 | 150
$300 | 100
$400 | 50
$500 | 25
$600 | 5
- Table 2
Prices ($) | Quantity Demanded
$300 | 10
$250 | 50
$200 | 100
$150 | 200
$100 | 300
$50 | 400
$25 | 500
$5 | 600
A: Table 2
Prices ($) | Quantity Demanded
$300 | 10
$250 | 50
$200 | 100
$150 | 200
$100 | 300
$50 | 400
$25 | 500
$5 | 600

Q: Two common ways to discourage tobacco use are taxes on tobacco and information campaigns on the hazards of tobacco use. Which one causes a shift in the demand curve for smoking?
- Tax on tobacco products that drives up its price.
- Both cause a decrease in demand.
- Information campaign on hazards of tobacco.
A: Information campaign on hazards of tobacco.

Q: Information campaigns about tobacco hazards and taxes on tobacco are two ways to discourage its use. Which one causes a movement along the demand curve?
- The tax on tobacco products that drives up its price.
- Both cause a decrease in demand
- The Information campaign on hazards of tobacco.
A: The Information campaign on hazards of tobacco.

Q: What would cause the level of demand (meaning the relationship between price and quantity demanded) to shift?
- Consumer incomes remain unchanged.
- The price of the good increases.
- Population grows in a particular market area.
A: Population grows in a particular market area.

Q: In order for the relationship between price and quantity demanded to shift, (known as the level of demand), what would need to take place?
- Population remains constant in a particular market area.
- The price of the good increases.
- Consumer incomes increase.
A: Consumer incomes increase.

Q: Complete the following sentence: If people think that the price of electronics will increase in the near future, that belief may cause a(n)
- increase in the supply of electronics today.
- decrease in the price of electronics today.
- increase in the demand for electronics today.
A: increase in the demand for electronics today.

Q: Complete the following sentence: If people think that the price of televisions will decrease in the near future, that belief may cause a(n)
- increase in the supply of televisions today.
- increase in the price of televisions today.
- decrease in the demand for televisions today.
A: decrease in the demand for televisions today.

Q: Bob sells farm equipment in Iowa and has for twenty years. The last two months he has seen the quantity demanded for high-end tractors decrease by 35% compared to the same time last year. What is a possible explanation for events that have shifted the demand curve?
- Customers’ incomes have increased.
- The price of tractors has increased.
- Customers’ incomes have decreased.
A: Customers’ incomes have decreased.

Q: A new tool manufacturer opened a plant in town three months ago and hired 3000 new employees. People now have extra cash to spend and are out spending in the town. What is an example of how this extra money may shift the demand curve for goods and services in the town?
- There is a 20% decrease in the amount of tires sold at the local automotive store.
- The price of used cars has remained the same as before.
- A local restaurant has a 40% increase in the number of dinners.
A: A local restaurant has a 40% increase in the number of dinners.

Q: If a decrease in the price of MP3 players decreases the demand for CD players, this means that
- MP3 players and CD players are inferior goods.
- MP3 players and CD players are normal goods.
- MP3 players and CD players are substitutes.
A: MP3 players and CD players are substitutes.

Q: If an increase in the price of Nike shoes increases the demand for Adidas shoes, this means that
- Nike shoes and Adidas shoes are inferior goods.
- Nike shoes and Adidas shoes are normal goods.
- Nike shoes and Adidas shoes are substitutes.
A: Nike shoes and Adidas shoes are substitutes.

Q: When the price of a particular good increases
- demand for substitute goods falls.
- demand for normal goods rises.
- demand for complementary goods falls.
A: demand for complementary goods falls.

Q: If Pepsi goes on sale, what will happen to the demand for Coca-Cola?
- Demand for Coca-Cola will increase.
- Demand for Coca-Cola will stay the same.
- Demand for Coca-Cola will decrease.
A: Demand for Coca-Cola will decrease.

Q: The price of printers at the big box technology stores increases as a new type of print technology is rolled out to consumers. Which of the following scenarios for a complementary printer good would likely take place?
- The demand for printer ink rises as people stock up with their new printers.
- The demand for printer paper rises as people stock up.
- The demand for printer ink decreases as less people are buying printers.
A: The demand for printer ink decreases as less people are buying printers.

Q: If the demand for home gaming system games has dramatically increased in the last month, what scenario is most likely to have happened?
- More people have been laid off from their jobs and have more time on their hands.
- The population of gamers has found substitutes for game technologies.
- There have been great deals on gaming systems for the holidays.
A: There have been great deals on gaming systems for the holidays.

Q: Hannah has a small business making clothing alterations. Which of the following products would dramatically affect her profit margins if the price were to decrease for that product?
- thread
- sewing machines
- dresses
A: dresses

Q: George owns a custom pottery business where he makes all types of mugs and drinkware. Which of the following products would dramatically affect his profit margins if the price were to decrease for that product?
- clay
- silverware
- coffee mugs
A: coffee mugs

Q: Analyze the following diagram:

A new study shows that onions improve cognitive and heart health. This causes the demand curve to shift to the right, so that consumers demand 20 lbs more onions at any given price. What two points must the new demand curve pass through?
- ($3.00, 380 lbs) and ($2.10, 470 lbs)
- ($2.70, 430 lbs) and ($2.20, 480 lbs)
- ($3.00, 420 lbs) and ($2.10, 510 lbs)
A: ($3.00, 420 lbs) and ($2.10, 510 lbs)

Q: Imagine that a new study reveals that onion consumption is correlated with cancer. This shift in popularity will likely cause the new demand curve to run through which of the following points?
- ($3.00, 420 lbs) and ($2.10, 510 lbs)
- ($3.00, 380 lbs) and ($2.10, 470 lbs)
- ($2.70, 400 lbs) and ($1.90, 480)
A: ($2.70, 400 lbs) and ($1.90, 480)

Q: Analyze the following diagram:

You own an auto dealership that has recently been sued for selling poor quality cars. The diagram represents your demand curve before the lawsuit. You find that subsequent the lawsuit the demand for cars has decreased by 10% at any given price. What two points must the new demand curve pass through?
- ($20,000, 100) and ($15,000, 200)
- ($18,000, 90) and ($13,500, 180)
- ($20,000, 90) and ($15,000, 180)
A: ($20,000, 90) and ($15,000, 180)

Q: Analyze the following diagram:

You own an auto dealership that has recently received many five star customer reviews at online review sites stating you sell quality cars and are very trustworthy. The diagram represents your demand curve before the online reviews. You find that the positive online reviews increase the demand by 20 cars at any given price. What two points will the new demand curve probably pass through?
- ($20,000, 100) and ($15,000, 200)
- ($18,000, 80) and ($13,500, 180)
- ($20,000, 120) and ($15,000, 220)
A: ($20,000, 120) and ($15,000, 220)

Q: Analyze the following diagram:

The new “Hungry for Apples?” campaign has been a resounding success, so that the quantity demanded is now 100% greater than before the ad campaign. If the curve above represents demand after the campaign, what was the original quantity demanded when price was $4.60?
- 40
- 80
- 20
A: 20

Q: The new “Hungry for Apples?” campaign has been a resounding success, so that the quantity demanded is now 100% greater than before the ad campaign. If the curve above represents demand after the campaign, what was the original quantity demanded when price was $4.40?
- 50
- 100
- 25
A: 25

Q: and ends at (12,5). Another downward sloping line starts at (6,30) and ends at (16,5)) Wallace is analyzing the American moped market for BMW. The main competition, Vespa, dropped their listing price by 20% recently. When creating a demand curve arrows are used to indicate the direction of the demand curve shift. Which is the correct direction the arrows should be drawn for the moped market and which line is the old demand and new demand curve?
- The arrows should be drawn pointing leftwards. The curve on the left represents the old demand and the curve on the right the new demand.
- The arrows should be drawn pointing rightwards. The curve on the right represents the new demand and the curve on the left old demand.
- The arrows should be drawn pointing leftwards. The curve on the right represents the old demand and the curve on the left new demand.
A: The arrows should be drawn pointing leftwards. The curve on the right represents the old demand and the curve on the left new demand.

Q: and ends at (12,5). Another downward sloping line starts at (6,30) and ends at (16,5)) Alice is analyzing the American moped market for Vespa. The main competition, BMW, increased their listing price by 20% recently. Arrows are used to indicate the direction of the demand curve shift in a graph. Which is the correct direction the arrows should be drawn to reflect the moped market and which line is the old demand and new demand curve?
- The arrows should be drawn pointing leftwards. The curve on the left represents the old demand and the curve on the right the new demand.
- The arrows should be drawn pointing leftwards. The curve on the right represents the old demand and the curve on the left new demand.
- The arrows should be drawn pointing rightwards. The curve on the right represents the new demand and the curve on the left old demand.
A: The arrows should be drawn pointing rightwards. The curve on the right represents the new demand and the curve on the left old demand.