Chapter 2 Demand, Supply, and Equilibrium Prices

1)
According to the case for analysis (Demand and Supply in the Copper Industry)
in the text, all of the following can lead to a decline in the price of copper except:

A)
steady production uninterrupted by labor strikes or natural disasters.
B)
substitution away from copper to other materials such as aluminum and plastic.
C)
an increase in mining of higher grade materials.
D)
a surge in demand from foreign importers.

2)
All else constant, as more firms substitute alternative materials, e.g.,
plastic, for copper, the market price of copper would be expected to:
A)
increase.
B)
stay the same.
C)
decrease.
D)
cannot be determined with the information given.

3)
“Demand” is best defined as the relationship between:
A)
the price of a good and the quantity consumers are willing and able to buy at
each price level.
B)
the current price of a good and the quantity demanded at that price.
C)
the quantity supplied and the price people are willing to pay for a good.
D)
the amount of income someone has and the price he is willing to pay for a good.

4)
All of the following are non-price factors that influence demand except:

A)
tastes and preferences.
B)
quantity supplied.
C)
income.
D)
the prices of related goods.

5)
A home theater system and an HD television would be considered an example of:
A)
substitute goods.
B)
giffen goods.
C)
inferior goods.
D)
complementary goods.
6)
DSL and broadband internet service would be considered an example of:
A)
substitute goods.
B)
giffen goods.
C)
inferior goods.
D)
complementary goods.

7)
Many people consider hot dogs to be an inferiorgood. For such people,
all else held constant, a decrease in income would cause their demand for hot
dogs to:
A)
increase.
B)
stay the same.
C)
decrease.
D)
cannot be determined with the information given.

8)
If the price of salmon increases relative to the price of cod, the demand for:
A)
cod will decrease.
B)
cod will increase.
C)
salmon will decrease.
D)
salmon will increase.

9)
If movies on DVD for home rental and movies seen at a theater are substitutes,
and the price of movies seen at a theater increases, the demand for movies on
DVD will:
A)
increase.
B)
stay the same.
C)
decrease.
D)
cannot be determined.

10)
An increase in the number of buyers in the market for LED TVs would cause the
market demand curve for LED TVs to:
A)
shift right.
B)
shift left.
C)
stay the same because market demand doesn’t depend on the number of buyers.
D)
shift left or right depending on whether the new buyers purchase more or less
than existing customers at each price.