Question

1. An decrease in demand combined with no change in supply

		results in only a movement rightward along the demand curve.
		decreases quantity demanded because the supply curve does not shift.
		raises the equilibrium price.
		lowers the equilibrium price.

2.Which of the following is  NOT one of the factors that influences the supply of a product?

		number of suppliers
		income
		technology
		expected future prices

3.If a technological advance takes place in the computer industry, then the equilibrium price of a computer will ________ and the quantity demanded will ________.

		rise; decrease
		fall; increase
		rise; increase
		fall; decrease

4. Assume that beef and pork are substitutes for consumers. If the price of beef increases (the substitute good), it will shift the

		supply curve of pork leftward.
		demand curve for pork leftward.
		demand curve for pork rightward.
		supply curve of pork rightward.

5.If, as people's incomes increase, the demand for a good increases, the good is called

		a complement.
		a normal good.
		a substitute.
		an inferior good.

6. When the demand for a good increases, its equilibrium price ________ and quantity supplied ________.

		falls; increases
		falls; decreases
		rises; increases
		rises; decreases

7.Suppose we observe that both the equilibrium price of film cameras and the equilibrium quantity of film cameras have fallen. Which of the following could be responsible for this?

		Workers who make cameras received a pay raise.
		The price of digital cameras increased.
		Consumers' preferences changed in favor of digital cameras.
		Technological advances were made in film camera production.

8.If both the demand and supply decrease, the equilibrium quantity

		increases and the effect on the equilibrium price is indeterminate.
		decreases and the effect on the equilibrium price is indeterminate.
		decreases and the equilibrium price rises.
		increases and the equilibrium price falls.

Answer 1

1. A decrease in demand combined with no change in supply shifts the demand curve leftward. As a result ,it lower the equilibrium price. Hence, option(D) is correct.

2. Income doesn't influence the supply of a product, it only influence the demand. Hence, option(B) is correct.

3. If a technological advance takes place in the computer industry ,this will increase the supply of computers .As a result, the equilibrium price of computer will fall and the quantity demanded will increase. Hence, option(B) is correct.

4. Assume that beef and pork are substitutes. If price of beef increases, this will increase the demand for pork. And therefore, this will shift the demand curve for pork rightward. Hence, option(C) is correct.

5. If ,as people income increases , the demand for good increases ,the good is called a normal good. Hence, option(B) is correct.

6. When the demand for a good increases ,this would shift the demand curve rightward. As a result, the equilibrium price rises and the quantity supplied increases. Hence , option(C) is correct.

7. When consumer preferences have changed in favor of digital cameras ,then demand for film cameras would decrease and therefore, demand curve for film cameras shift leftward.As a result, equilibrium price and equilibrium quantity both fall. Hence, option(C) is correct.

8. If both the demand and supply decrease, the equilibrium quantity decreases and the effect on the equilibrium price is indeterminate. Hence, option(B) is correct.