Question : 111) Suppose that in Montreal in December, 2012, 10 000 : 1384150

111) Suppose that in Montreal in December, 2012, 10 000 ski helmets were sold at a price of $60 each. And in Montreal in December, 2013, 20 000 ski helmets were sold at a price of $80 each. One possible explanation for the change is that from 2012 to 2013 the ________ curve for ski helmets shifted to the ________.

A) supply; left

B) supply; right

C) demand; left

D) demand; right

E) supply or demand; right

112) Consider a local market for 4-litre containers of windshield-wiper fluid. In January 2012, 100 000 containers were sold at a price of $3 each. In March 2012, 120 000 containers are sold at a price of $8 each. Does this change in equilibrium price and quantity violate the “law of demand”?

A) Not necessarily, because the supply curve could have shifted to the right, leading to an increase in equilibrium price and quantity.

B) Not necessarily, because the demand curve could have shifted to the right, leading to an increase in equilibrium price and quantity.

C) Not necessarily, because the demand curve could have shifted to the left, leading to an increase in equilibrium price and quantity.

D) Not necessarily, because the supply curve could have shifted to the left, leading to an increase in equilibrium price and quantity.

E) No, because the “law of demand” is not valid.

113) Suppose we observe an increase in the price of good A and an increase in the quantity of good A exchanged. Which of the following is a likely explanation?

A) The “law of demand” is violated.

B) The “law of supply” is violated.

C) The supply of good A has increased.

D) There is an excess supply of good A.

E) The demand for good A has increased.

114) Consider a negatively sloped demand curve for natural gas. If the supply of natural gas increases, the new equilibrium will have

A) a lower price and a greater quantity.

B) a lower price and a smaller quantity.

C) a higher price and a smaller quantity.

D) a higher price and a larger quantity.

E) the same price and larger quantity.

115) Which of the following statements is correct for a market with an upward-sloping supply curve and a downward-sloping demand curve?

A) If the supply curve shifts left and demand remains constant, equilibrium quantity will rise.

B) If the supply curve shifts right and the demand curve remains constant, equilibrium price will rise.

C) If the demand curve shifts left and the supply curve shifts right, equilibrium price will rise.

D) If the demand curve shifts right and the supply curve shifts left, equilibrium price will rise.

E) If the demand curve shifts left and the supply curve shifts left, equilibrium price will fall.

116) Refer to Figure 3-6. If the initial demand and supply curves are D1 and S1, equilibrium price and quantity are represented by point

A) A.

B) B.

C) C.

D) D.

E) Not shown in the figure.

117) Refer to Figure 3-6. If the demand curve shifts from D1 to D2, while supply remains at S1, one could say that

A) the quantity demanded has decreased to Q1 and price has fallen to P2.

B) there has been an increase in demand for X.

C) the price of a good which is a substitute for X must have fallen.

D) the price increase has caused an increase in quantity demanded.

E) there is now an excess demand at the new price of P1.

118) Refer to Figure 3-6. If the initial demand and supply curves are D1 and S1, and demand shifts to D2, then

A) a permanent shortage of X will result.

B) a surplus of Q1Q3 will occur.

C) a shortage will occur at any price above P3.

D) if price remained at P2, a shortage of Q1Q3 would exist.

E) all of the above

119) Refer to Figure 3-6. A shift in the supply curve from S2 to S1 might be caused by

A) a rise in the costs of producing good X.

B) a decrease in the price of X.

C) a decrease in demand for X.

D) an improvement in the technology of producing good X.

E) additional suppliers entering the industry.

120) With a given upward-sloping supply curve for sirloin steak (a normal good), a rise in household income will cause the

A) equilibrium price and equilibrium quantity to both increase.

B) equilibrium price to increase and equilibrium quantity to decrease.

C) equilibrium price and equilibrium quantity to both decrease.

D) equilibrium price to decrease and equilibrium quantity to increase.

E) equilibrium price to increase and equilibrium quantity to remain constant.