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DEC5114 Tutorial 03

Total questions: 15

Worksheet time: 8mins

Name
Class
Date
1.

Resources are

a)

scarce for households but plentiful for economies.

b)

plentiful for households but scarce for economies.

c)

scarce for households and scarce for economies.

d)

plentiful for households and plentiful for economies.

2.

According to the law of demand there is ________ relationship between price and quantity demanded.

a)

a positive

b)

a negative

c)

either a positive or negative

d)

a constantly changing

3.

When the price of a good or service changes,

a)

the supply curve shifts in the opposite direction.

b)

the demand curve shifts in the opposite direction.

c)

the demand curve shifts in the same direction.

d)

there is a movement along a given demand curve.

4.

Refer to Figure 3.1. Which of the following would be most likely to cause the demand for macaroni and cheese to shift from D1 to D0?

a)

an increase in the price of macaroni and cheese

b)

an increase in the price of flour used to make macaroni and cheese

c)

an increase in income, assuming macaroni and cheese is a normal good

d)

an increase in the quantity demanded for macaroni and cheese

5.

Refer to Figure 3.1. Which of the following would be most likely to cause the demand for macaroni and cheese to shift from D0 to D1?

a)

a decrease in the price of macaroni and cheese

b)

an increase in the price of flour used to make macaroni and cheese

c)

a decrease in income, assuming macaroni and cheese is a normal good

d)

an increase in the quantity demanded for macaroni and cheese

6.

If the demand for sardines increases as income decreases, sardines are a(n)

a)

normal good.

b)

inferior good.

c)

substitute good.

d)

complementary good.

7.

Suppose the demand for books goes down when the price of video games goes down. We can say that these two goods are

a)

complements.

b)

substitutes.

c)

unrelated goods.

d)

perfect substitutes.

8.

A decrease in demand for cameras would likely be caused by

a)

an increase in the price of a substitute good.

b)

an increase in the price of cameras.

c)

an increase in the price of a complementary good.

d)

a decrease in the price of cameras.

9.

In response to news reports that drinking a glass of red wine each day can reduce an individual's risk of heart disease, there will most likely be a(n)

a)

increase in the demand for red wine.

b)

decrease in the supply of red wine.

c)

increase in the supply of red wine.

d)

increase in the quantity demanded of red wine.

10.

10. The change in the price of a good leads to a change in ________, which leads to a ________.

a)

quantity supplied; movement along a supply curve

b)

quantity supplied; shift of the supply curve

c)

supply; movement along a supply curve

d)

supply; shift of the supply curve

11.

If the price of spinach decreases, there will be ________ of spinach enchiladas.

a)

an increase in the supply

b)

a decrease in the supply

c)

an increase in the quantity supplied

d)

decrease in the quantity supplied

12.

Refer to Figure 3.2. An increase in the wage rate of gardenburger makers will cause a movement from Point B on supply curve S2 to

a)

Point A on supply curve S2.

b)

Point C on supply curve S2.

c)

supply curve S3.

d)

supply curve S1.

13.

Refer to Figure 3.2. A decrease in supply is represented by the movement from

a)

S2 to S3.

b)

S2 to S1.

c)

Point B to Point A along supply curve S2.

d)

Point B to Point C along supply curve S2.

14.

The price of circuit boards used in the manufacturing of LCD televisions has fallen. This will lead to ________ LCD televisions.

a)

an increase in the supply of

b)

a decrease in the supply of

c)

an increase in the quantity supplied of

d)

a decrease in the quantity supplied of

15.

If the price of chili increases, there will be ________ of chili cheese fries.

a)

an increase in the supply

b)

a decrease in the supply

c)

an increase in the quantity supplied

d)

a decrease in the quantity supplied