Chapter 3 Reading Quiz

1. If the price of a good is above the equilibrium price, 

1. there will be excess demand 
2. there will be a shortage
3. demand will exceed supply
4. there will be a surplus 

2. Massive wildfires destroy thousands of acres of oranges, what happens to the market for oranges?

1.  the demand for oranges increase and prices rise
2. the supply of oranges decrease and prices fall
3. the demand for oranges decrease and prices rise
4. the supply of oranges decrease and prices rise 

3. The table below displays the market demand for churros. 

What is the equilibrium price and quantity?

1. Price = $1.25, Quantity 900 
2. Price = $1.00, Quantity = 1000
3. Price = $1.50, Quantity = 950
4. Price = $1.50, Quantity = 1000 

4. At the beginning of the pandemic, millions of people became unemployed and incomes fell. Around the same time, the demand for rice increased dramatically. Rice is what type of good?

1. A substitute 
2. A normal good
3. An inferior good
4. A complement 

5. Which of the following will cause the demand for a good to shift?

1. a change in the price of the good
2. changes in expectations
3. a change in the number of sellers
4. changes in input prices 

6. The table below displays the market demand for churros. 

If the government sets a price ceiling at $1.25, what would be the result?

1. A surplus of 75 churros 
2. A shortage of 25 churros
3. A shortage of 75 churros
4. A surplus of 50 churros 

7. The price of Pepsi decreases and this causes the demand for Coca Cola to fall. This is an example of 

1. complementary goods 
2. substitute goods
3. inferior goods
4. Giffen goods 

8. When there is a change in the price of a good, there is a change in 

1. neither demand nor supply 
2. demand
3. supply
4. quantity demanded and quantity supplied 

9 A legal minimum price is a(n)

1. equilibrium price 
2. price floor
3. price ceiling
4. shortage 

10. A YouTube celebrity advertises a certain brand of shoes. What will likely happen to the market for these particular shoes

1. The demand will decrease
2. The supply will increase 
3. The supply will decrease
4. The demand will increase