Question : 29) Assume there a shortage in the market for digital : 1387396

29) Assume there is a shortage in the market for digital music players. Which of the following statements correctly describes this situation?

A) The demand for digital music players is greater than the supply of digital music players.

B) Some consumers will be unable to obtain digital music players at the market price and will have an incentive to offer to buy the product at a higher price.

C) The price of digital music players will rise in response to the shortage; as the price rises the quantity demanded will increase and the quantity supplied will decrease.

D) the shortage will cause an increase in the equilibrium price of digital music players.

30) In a perfectly competitive market, there are ________ buyers and ________ sellers.

A) many; few

B) few; many

C) many; many

D) few; few

Figure 3-6

31) Refer to Figure 3-6.  The figure above represents the market for canvas tote bags. Assume that the market price is $35. Which of the following statement is true?

A) There is a surplus that will cause the price to decrease; quantity demanded will then increase and quantity supplied will decrease until the price equals $25.

B) There is a surplus that will cause the price to decrease; quantity supplied will then increase and quantity demanded will decrease until the price equals $25.

C) There will be a surplus that will cause the price to decrease; demand will then increase and supply will decrease until the price equals $25.

D) There is a surplus that will cause the price to increase; quantity demanded will then decrease and quantity supplied will increase until the price equals $25.

32) Refer to Figure 3-6.  The figure above represents the market for canvas tote bags. Assume that the price of tote bags is $15. At this price:

A) the quantity demanded exceeds the quantity supplied of tote bags by 75. The price will eventually rise to $25 where quantity demanded will equal quantity supplied.

B) the demand exceeds the supply of tote bags by 55. Some consumers will have an incentive to offer to buy tote bags at a higher price.

C) there is a shortage, equal to 55 tote bags, that will be eliminated when the price rises to $25.

D) there is a shortage equal to 55 tote bags; the price of tote bags will rise until demand is equal to supply.

33) Refer to Figure 3-6.  The figure above represents the market for canvas tote bags. Compare the conditions in the market when the price is $50 and when the price is $35. Which of the following describes how the market differs at these prices?

A) At each price there is a surplus; the surplus is greater at $35 than at $50.

B) The difference between quantity supplied and quantity demanded is greater at $50 than at $35.

C) At each price there is a surplus; firms will lower the equilibrium price in order to eliminate the surplus.

D) At each price the supply of tote bags exceeds that demand for tote bags.

34) Refer to Figure 3-6.  The figure above represents the market for coffee grinders. Assume that the market price is $21. Which of the following statements is true?

A) There is a shortage that will cause the price to increase; quantity demanded will then decrease and quantity supplied will increase until the price equals $25.

B) There is a shortage that will cause the price to increase; quantity supplied will then decrease and quantity demanded will increase until the price equals $25.

C) There will be a shortage that will cause the price to increase; demand will then decrease and supply will increase until the price equals $25.

D) There is a shortage that will cause the price to decrease; quantity demanded will then increase and quantity supplied will decrease until the price equals $25.

35) Refer to Figure 3-6.  The figure above represents the market for coffee grinders. Assume that the price of coffee grinders is $50. At this price,

A) the quantity supplied exceeds the quantity supplied by 100. The price will eventually fall to $25 where quantity demanded will equal quantity supplied.

B) the supply exceeds the demand by 90. Some producers will have an incentive to offer to sell coffee grinders at a lower price.

C) there is a surplus equal to 90 coffee grinders that will be eliminated when the price falls to $25.

D) there is a surplus equal to 90 coffee grinders and the price of coffee grinders will fall until demand is equal to supply.

36) Refer to Figure 3-6.  The figure above represents the market for coffee grinders. Compare the conditions in the market when the price is $15 and when the price is $21. Which of the following describes how the market differs at these prices?

A) At each price there is a shortage; the shortage is greater at $15 than at $21.

B) The difference between quantity supplied and quantity demanded is greater at $21 than at $15.

C) At each price there is a shortage; firms will raise the equilibrium price in order to eliminate the shortage.

D) At each price the demand for coffee grinders exceeds the supply of coffee grinders.

37) If, for a product, the quantity supplied exceeds the quantity demanded, the market price will fall until

A) the quantity demanded exceeds the quantity supplied. The market will then be in equilibrium.

B) quantity demanded equals quantity supplied. The equilibrium price will then be lower than the market price.

C) all consumers will be able to afford the product.

D) quantity demanded equals quantity supplied. The market price will then equal the equilibrium price.

38) Which of the following is evidence of a surplus of bananas?

A) Firms raise the price of bananas.

B) The price of bananas is lowered in order to increase sales.

C) The equilibrium price of bananas rises due to an increase in demand.

D) The quantity demanded of bananas is greater than the quantity supplied.