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1. Which of the following will NOT causean increase in demand for good X? (Point

ID: 1238513 • Letter: 1

Question

1. Which of the following will NOT causean increase in demand for good X? (Points: 1)
       a decrease in income ifgood X is an inferior good
       an increase in income ifgood X is a normal good
       a decrease in the priceof good X
       an increase inconsumers' taste for good X


2. A good is inferior if ______. (Points:1)
       when income increases,demand remains unchanged
       when income increases,demand decreases
       when income increases,demand increases
       none of theabove


3. A technological advance in the productionof automobiles will _______. (Points: 1)
       increase the demand forautomobiles
       increase the supply ofautomobiles
       decrease the demand forautomobiles
       decrease the supply ofautomobiles


4. A recent news story reported that OPEC isexpected to decrease the supply of oil next summer. Summer istraditionally a time of increased demand for oil because of themany families driving and flying to vacation sites. What would bethe combined effect of these two events on the summer market forgasoline? (Points: 1)
       an increase in the priceand the quantity
       an increase in the priceand an unpredictable change in the quantity
       an unpredictable changein both the price and the quantity
       an unpredictable changein the price and a decrease in the quantity


5. You notice that the price of DVD playersfalls and the quantity of DVD players sold increases. This set ofobservations can be the result of the ______. (Points: 1)
       demand for DVD playersshifting to the right
       demand for DVD playersshifting to the left
       supply of DVD playersshifting to the right
       supply of DVDplayers shifting to the left
1. Which of the following will NOT causean increase in demand for good X? (Points: 1)
       a decrease in income ifgood X is an inferior good
       an increase in income ifgood X is a normal good
       a decrease in the priceof good X
       an increase inconsumers' taste for good X


2. A good is inferior if ______. (Points:1)
       when income increases,demand remains unchanged
       when income increases,demand decreases
       when income increases,demand increases
       none of theabove


3. A technological advance in the productionof automobiles will _______. (Points: 1)
       increase the demand forautomobiles
       increase the supply ofautomobiles
       decrease the demand forautomobiles
       decrease the supply ofautomobiles


4. A recent news story reported that OPEC isexpected to decrease the supply of oil next summer. Summer istraditionally a time of increased demand for oil because of themany families driving and flying to vacation sites. What would bethe combined effect of these two events on the summer market forgasoline? (Points: 1)
       an increase in the priceand the quantity
       an increase in the priceand an unpredictable change in the quantity
       an unpredictable changein both the price and the quantity
       an unpredictable changein the price and a decrease in the quantity


5. You notice that the price of DVD playersfalls and the quantity of DVD players sold increases. This set ofobservations can be the result of the ______. (Points: 1)
       demand for DVD playersshifting to the right
       demand for DVD playersshifting to the left
       supply of DVD playersshifting to the right
       supply of DVDplayers shifting to the left

Explanation / Answer

(1) Ans: a decrease in the price of goodX This is because a decrease in price will cause a change in QUANTITYdemand, but the demand curve does not shift. (2)Ans: when income increases, demanddecreases This is the definition of inferior good: income increases, demanddecreases (3)Ans: increase the supply ofautomobiles Technological advance enable a particular conditions (number ofworkers, machines etc) to produce more products. This shifts thesupply surve to the right. (4)Ans: an increase in the price and thequantity Decrease supply of oil cause price to increase. (5)Ans: supply of DVD players shifting to theright As supply increase, price will drop Hope this helps!