All of the following are examples of complements EXCEPT
butter and margarine
cameras and film
peanut butter and jelly
flashlights and batteries
Q.2.
The example of goods of Snob Appeal would be
Buying a Ferrari
Buying basic utilities
Buying a Car Insurance
Opening up a Bank Account
Q.3.
Jennifer Lopez is seen wearing a new short and sleek dress. People now want this dress. Which demand determinant is this most likely to fall under?
Change in Consumer Income
Change in Consumer Tastes
Change in Price of Substitute Good
Change in Consumer Price Expectations
Q.4.
If the demand for digital cameras increases when consumers' incomes rise, then digital cameras are
a normal good
an inferior good
a substitute good
a complement to video cameras
Q.5.
All of the following will result in a shift in a demand curve except:
A change in the income of buyers
A change in the supply of a goo
A change in expected future prices
A change in the price of related goods
Q.6.
The effect that increasing or decreasing prices has on the buying power of a person is better known as....
Income Effect
Substitution Effect
Diminishing Marginal Returns
Inflation
Q.7.
Consider the market for SUVs. If the price of gasoline increases then the Demand for these vehicles will
increase
decrease
not be affected
Q.8.
Consider the market for cellular phones. Which of the following shifts the demand curve leftward?
studies showing using cellular phones can cause brain cancer
a decrease in the price of cellular phones
a decrease in the quantity demanded of cellular phones
an increase in the services provided by cellular phones, such as text messaging
Q.9.
When the price of a product increases, a consumer is able to buy less of it with a given money income. This describes:
the cost effect
the inflationary effect
the income effect
the substitution effect
Q.10.
The law of demand states that
price and quantity demanded are inversely related
the larger the number of buyers in a market, the lower will be product price
price and quantity demanded are directly related
consumers will buy more of a product at high prices than at low prices
Q.11.
Ramen noodles are a staple food item for many college students. Ramen noodles are very inexpensive, easy to prepare, and can be combined easily with other foods. After students graduate, find employment, and earn a higher income, they decrease their Ramen noodle purchases significantly. In this case, Ramen noodles are:
a normal good
an inferior good
a complement for higher income people
none of these are correct
Q.12.
If the demand for a good increases when people's incomes increase,
the good is an inferior good
the law of demand is violated
the good's demand curve must be upward sloping
the good is a normal good
Q.13.
Iceberg & romaine are two different types of lettuce. For most consumers, iceberg and romaine are
complements
substitutes
inferior goods
resources
Q.14.
The phrase "a change in demand" most directly implies a
movement along the curve
movement along the price curve
change in quantity demanded of a good
shift in the demand curve
Q.15.
The law of demand says that when the price of a product rises, the quantity demanded decreases. Why do people buy fewer CDs if the price of a CD rises?
When the price rises, people get less pleasure from listening to music
If CDs become more expensive, people switch to relatively less expensive alternative goods, such as cassette tapes
Higher prices just turn people off
Because CDs are a normal good
Q.16.
When the price of good A rises, people start to drink good B. In this case, what is good B considered?
luxury good
complementary good
substitute good
normal good
Q.17.
A decrease in the average incomes of consumers will result in which of the following?
A decrease in the demand for goods and services
An increase in the demand for goods and services
A decrease in the supply of goods and services
An increase in the supply of goods and services
Q.18.
The law of demand states; there is an INVERSE relationship between price and quantity demanded. Which of the following is not a true statement?
Price goes up qty demanded goes down.
Price goes down, qty demanded goes up.
Price goes up, demand goes down.
All answers are correct.
Q.19.
What is the relationship between the Price and Quantity Demanded?
Positive Relationship
Direct Relationship
Inverse Relationship
Mixed Relationship
Q.20.
The quantity demanded of a good or service changes at all price levels best describes the concept of
change in quantity demanded
elasticity
change in demand
demand curve
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