B. Main Ideas Directions:Identify the choice that best completes the statement or answers the question. The price of home computers rises. According to the law of supply, manufacturers will respond to this price increase by

keeping computer production steady.

halting computer production.

decreasing computer production.

increasing computer production.

Question 8

John gets a raise and decides to start buying enriched pasta instead of cheaper instant noodles. For John, instant noodles are examples of

Group of answer choices

market demand.

complements.

inferior goods.

inelasticity.

Question 9

During a six-month period, the price of a popular shoe rises from $28 to $39 a pair. During this same period, demand for this shoe will probably

increase.

decrease.

disappear.

remain constant.

Question 10

Owners of digital cameras have to buy memory cards in order to use the cameras. Cameras and memory cards are

complements

substitutes.

unrelated.

elastic.

Question 11

The price of cranberry juice suddenly increases. As a result, Glenda begins drinking more grape juice, which is less expensive, but tastes just as good to her. In this case, Glenda's elastic demand is due to

change over time.

relative importance.

availability of substitutes.

necessities versus luxuries.

Question 12

Due to an increase in her rent, Isa needs to cut back her spending on other items. Which of the following types of goods will Isa consume less of?

normal goods

substitutes

complements

inferior goods

Question 13

In July, an automobile company announces that it will put all its cars on sale in September. What is likely to happen to demand for its cars in August?

Demand will stay the same.

Demand will go to zero.

Demand will rise.

Demand will fall.

Question 14

The law of supply states that the quantity supplied is usually related to its

Group of answer choices

color.

cost to produce.

labor costs.

price.

: Question 15

The termquantity suppliedrefers to

the number of individual producers.

a particular amount offered for sale at a particular price.

the supply of all producers in the market.

the entire supply schedule or supply curve.

Question 16

Which of these events would indicate a movementalonga supply curve for batteries?

A new trade agreement enables stores to import foreign batteries.

A new law requires battery manufacturers to spend more money on environmentally safe batteries.

Battery manufacturers raise the price of a package of AA batteries from $3.50 to $3.95.

Workers at a major battery factory go on strike and stop production.

: Question 17

Question 172.85pts

Farmer Brown has ten dairy cows. Her costs to feed the cows go up, although milk production remains the same. What effect will this rise in costs have on her supply?

Group of answer choices

Supply will remain the same, but she will have to sell more.

Her supply will go up, because she won't sell as much milk.

Her supply will go down, because her fixed costs have risen.

None, although she will raise prices to make up the lost revenue.

Question 18

What do sellers do if they expect the price of their goods to increase dramatically in the near future?

Group of answer choices

store the goods until the price rises

sell the goods now but try to get the higher price for them

sell the goods now and try to invest the money instead of resupplying

store the goods indefinitely regardless of when the price rises

Question 19

A hot summer causes demand for ice cream to go up. What happens next?

Workers at ice cream factories go on strike and stop production.

Stores import ice cream from overseas.

Ice cream factories make less ice cream.

Ice cream makers raise the price of ice cream.

: Question 20

In general, what happens to the price of a good or service when a shortage of that good or service occurs?

Group of answer choices

It decreases until quantity demanded equals quantity supplied.

It remains unchanged while quantity demanded drops.

It increases until quantity demanded equals quantity supplied.

A price ceiling is imposed, lowering the price to meet the demand.

Question 21

What happens to the price of a good or service when there is excess demand?

The price goes up.

The government sets the price.

The price stays the same.

The price goes down.

: Question 22

Question 222.85pts

If a baker's supply of bread exceeds the demand for bread, he should

Group of answer choices

sell only bread.

stop selling bread.

lower the price of bread.

raise the price of bread.

Flag question: Question 23

Question 232.85pts

How did an improvement in the technology for producing digital cameras affect supply?

Group of answer choices

The supply curve moved to the left.

The supply curve moved to the right.

The demand curve moved to the left.

The demand curve moved to the right.

Flag question: Question 24

Question 242.85pts

How did the market react to an increased supply of digital cameras?

Group of answer choices

Manufacturers produced fewer cameras.

Suppliers struggled to keep up with consumer demand for cameras.

Suppliers increased prices on the cameras.

A surplus of cameras forced suppliers to reduce prices.

Flag question: Question 25

Question 252.85pts

What happens after the demand for a fad drops?

Group of answer choices

The quantity supplied goes down, and the price goes up.

Excess supply makes the good easy to obtain.

The quantity supplied and the price both go up.

Shortage makes the good difficult to obtain.

Flag question: Question 26

Question 262.85pts

Which of the following could cause the supply curve of a good to shift to the right?

Group of answer choices

new technology to produce the good

a minimum wage increase

higher taxes on the good

s shortage of raw materials

Flag question: Question 27

Question 272.85pts

A shortage will develop when

Group of answer choices

the government provides subsidies to producers.

the discovery of new technology reduces production costs.

the market price is below the equilibrium price.

the quantity supplied is greater than the quantity demanded.

Flag question: Question 28

Question 282.85pts

In a free market, prices lead to an efficient allocation of resources. In other words,

Group of answer choices

resources are used in the most valuable and productive way according to the desires of consumers and producers.

the government decides who controls natural resources.

people who own resources are unable to bargain with people who wish to buy resources.

consumers can buy unlimited amounts of any good they like at a price of their choice.

Flag question: Question 29

Question 292.85pts

Why do fads often lead to shortages, at least in the short term?

Group of answer choices

Manufacturers charge such high prices for the goods that stores are unwilling to pay.

Laws prevent stores from responding to excess demand in time to prevent a shortage.

Demand increases too quickly and unexpectedly for the supply to keep up.

Buyers and sellers are unable to agree on a price for the good.

Flag question: Question 30

Question 302.85pts

How can a seller change prices to have an effect on a surplus or a shortage?

Group of answer choices

lower prices to increase demand in both a shortage and a surplus

raise prices in a surplus and lower prices in a shortage

lower prices in a surplus and raise prices in a shortage

raise prices to increase supply in both a shortage and a surplus

Flag question: Question 31

Question 312.85pts

Part 1: Main Idea Suppliers often reduce prices because they

Group of answer choices

have a surplus of products to sell

want to increase the product supply

have a shortage of products to sell

want to decrease consumer demand

Flag question: Question 32

Question 322.85pts

Part 1: Main Idea Higher prices generally

Group of answer choices

discourage producers from entering a market

discourage consumers from seeking a substitute

motivate producers to enter a market

motivate consumers to buy

Flag question: Question 33

Question 332.85pts

Part 1: Main Idea Lower prices generally

Group of answer choices

discourage producers from leaving a market

discourage consumers from buying

motivate consumers to buy

motivate producers to enter a market

Flag question: Question 34

Question 342.85pts

Part 1: Main Idea Supply is defined as

Group of answer choices

the willingness and ability of laborers to work for producers for pay

the willingness and ability of the government to offer protections to citizens

the willingness and ability of consumers to purchase goods and services

the willingness and ability of producers to offer goods and services for sale

Flag question: Question 35

Question 352.85pts

Part 1: Main Idea According to the law of supply, when prices increases,

Group of answer choices

demand increases

quantity demanded increases

quantity supplied increases

supply increases