3 DEMAND AND SUPPLY

Clicker Questions
Q1: The “law of demand” states that changes in
_________.

A demand are related directly to changes in supply

B the quantity demanded of a good are not related to
changes in the quantity supplied
C the quantity demanded of a good are inversely
related to changes in its price
D demand are inversely related to changes in supply

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Q2: In 2011, 200,000 gas grills were demanded at a
price of $500 per grill. In 2012, 250,000 gas grills were
demanded at the same price.

This increase could be the result any of the following

except __________.
A an increase in the supply of gas grills
B an increase in income if gas grills are a normal good
C a fall in the price of natural gas, a complement of a
gas grill
D an increase in population

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Q3: Which of the following events shifts the supply
curve of gasoline rightward?

A A situation in which the quantity demanded exceeds

the quantity supplied
B An increase in the price of gasoline
C a decrease in the price of a resource used to produce
gasoline, such as crude oil
D an increase in the demand for gas-guzzling, sport
utility vehicles

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Q4: Which of the following events creates a movement
along, but not a shift of, the supply curve for spinach?

A Disastrous weather that destroys half of this year’s

spinach crop.
B A rise in the price of spinach.
C An increase in wages for workers in spinach fields.
D Great weather that produces a bumper spinach crop
this year.

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Q5: In 2010, the price of a used Toyota Prius increased.
The most likely cause of this change was _________.

A a change in the population

B a decrease in the quantity of Prius demanded
C a change in preferences in favor of more fuel-efficient
cars
D the substitution effect

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Q6: When the price is below the equilibrium price, the
quantity demanded _________.

A is less than the equilibrium quantity and the

quantity supplied is also less than the equilibrium
quantity
B is less than the equilibrium quantity, but the
quantity supplied exceeds the equilibrium quantity
C exceeds the equilibrium quantity and the quantity
supplied also exceeds the equilibrium quantity
D exceeds the equilibrium quantity, but the quantity
supplied is less than the equilibrium quantity

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Q7: In a market, at the equilibrium price, ____.

A neither buyers nor sellers can do business at a better

price
B buyers are willing to pay a higher price, but sellers do
not ask for a higher price
C buyers are paying the minimum price they are willing
to pay for any amount of output and sellers are
charging the maximum price they are willing to charge
for any amount of production
D None of the above is true.

© 2014 Pearson Education