Economics Midterm 2023-2024

Which of the following would NOT be a determinant of demand?

• the price of related goods

• income

• tastes

• the prices of the inputs used to produce the good

If the price of a substitute to good X increases, then

• the demand for good X will increase.

• the market price of good X will decrease.

• the demand for good X will decrease.

• the demand for good X will not change.

What will happen in the rice market if buyers are expecting higher prices in the near future?

• The demand for rice will increase.

• The demand for rice will decrease.

• The demand for rice will be unaffected.

• The supply of rice will increase.

Refer to Graph 4-1. The movement from point A to point B on the graph shows

• a decrease in demand.

• an increase in demand.

• an increase in quantity demanded.

• a decrease in quantity demanded.

Other things equal, when the price of a good rises, the quantity supplied of the good also rises. This is

• the law of increasing costs.

• the law of diminishing returns.

• the law of supply.

• the law of demand.

Suppose that there is an increase in input prices. We would expect

• supply to increase.

• supply to decrease.

• supply could increase or decrease.

• supply to remain unchanged.

Refer to Graph 4-4. On the graph, the movement from S to S1 could be caused by

• a decrease in the price of the good.

• an increase in income.

• an improvement in technology.

• an increase in input prices.

Refer to Graph 4-5. According to the graph, equilibrium price and quantity are

• $7, 20.

• $7, 60.

• $5, 40.

• $3, 60.

Refer to the Graph 4-6. If price is $15, quantity supplied would be

• a. 200.

• b. 400.

• c. 500.

• d. 700.

Refer to the Graph 4-6. At a price of $20

• a. the market would be in equilibrium.

• b. 600 units would be bought and sold.

• c. there would be no pressure for price to change.

• d. All of the above are true.