Marketing I&II Determinants Review
Name Maha Mirbacha
Multiple Choice
Identify the choice that best completes the statement or answers the question.
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1. Which of the following DOES NOT affect the demand of a product?
a. the price of substitute goods
c. The number of consumers in the market.
b. consumer income
d. the cost of producing the product
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2. A demand curve is defined as the relationship between:
a. the income of consumers and the quantity c. the price of a good and the quantity of that
of a good that consumers are willing to
good that producers are willing to sell.
buy.
b. the income of consumers and the quantity d. the price of a good and the quantity of that
of a good that producers are willing to
good that consumers are willing to buy.
sell.
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3. The law of demand states that quantity demanded of a product increases as:
a. the price of the product rises.
c. the price of the product falls
b. consumer income rises
d. the prices of other products fall.
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4. The substitution effect of a price change implies that as the price of a good falls, people are likely to:
a. buy more of all goods.
c. buy more of the good.
b. buy less of all goods.
d. buy less of the good.
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5. Which of the following is best described by the statement: As the price of a product rises, consumers shift
their purchases to other products whose prices are now relatively lower?
a. the law of demand.
c. the substitution effect.
b. the income effect.
d. the principle of normal goods.
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6. A supply curve is defined as the relationship between:
a. the price of a good and the quantity that
c. the price of a good and the quantity that
producers are willing to sell.
consumers are willing to buy.
b. the income of consumers and the quantity d. the income of consumers and the quantity
of a product that consumers are willing to
of a product that producers are willing to
buy.
sell.
____
7. The law of supply states that firms supply more quantity of a product as:
a. The price of product rises.
c. consumer income falls.
b. the price of the product falls.
d. consumer income rises.
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8. Which of the following is NOT one of the variables that affect the decisions of sellers to change supply?
a. capital available for investment
c. cost of the inputs used to produce the
product
b. price of the product
d. state of production technology
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9. Suppose that the quantity supplied of pizza exceeds the quantity demanded for pizza. We would expect
that:
a. the price of pizza will increase.
c. the demand will increase to meet the
supply.
b. the price of pizza will decrease.
d. the supply will decrease to meet the
demand.
____ 10. In the event of excess supply in the sugar market:
a. the price of sugar will increase.
c. the supply of sugar will decrease to meet
the demand.
b. the demand for sugar will increase to meet d. the price of sugar will decrease.
the supply.
____ 11. When consumers are willing to buy more than producers are willing to sell:
a. the demand curve will shift until the
c. the market is in equilibrium.
quantity supplied equals the quantity
demanded.
b. there is excess demand for the product in d. there is excess supply of the product in the
the market.
market.
____ 12. Suppose that the quantity demanded for cars exceeds the quantity supplied of cars. We would expect that:
a. the supply will increase to meet demand. c. the price of cars will increase.
b. the price of cars will decrease.
d. the demand will decrease to meet the
supply.
____ 13. Judy demands more peanuts as her income increases. From this, we can conclude that:
a. peanuts are a substitute good.
c. peanuts are a normal good.
b. peanuts are a complementary good.
d. peanuts are an inferior good.
____ 14. A normal good is defined as a good for which demand decreases when:
a. the price decreases
c. the price increases
b. income decreases
d. income increases.
____ 15. Two goods are substitutes if:
a. the supply of one good decreases when the c. the supply of one good decreases when the
price of the other decreases.
price of the other increases.
b. the demand for one good decreases when d. the demand for one good decreases when
the price of the other increases.
the price of the other decreases.
____ 16. When the price of apples goes up:
a. the demand for apples will decrease.
b. the quantity demanded for apples will
increase.
c. the quantity demanded for apples will
decrease.
d. the demand for apples will increase.
____ 17. Assume that butter and margarine are substitutes. When the price of butter increases:
a. the demand for margarine increases.
c. the supply of margarine increases.
b. the supply of margarine decreases.
d. the demand for margarine decreases.
____ 18. Becky demands fewer raisins as her income increases. From this, we can conclude that:
a. raisins are a complementary good.
c. raisins are an inferior good.
b. raisins are a substitute good.
d. raisins are a normal good.
____ 19. Assume that chicken and beef are substitutes. When the price of beef increases:
a. the supply of chicken increases.
c. the supply of chicken decreases.
b. the demand for chicken increases.
d. the demand for chicken decreases.
____ 20. When the price of peanuts falls:
a. the quantity demanded of peanuts
decreases.
b. the demand for peanuts increases.
c. the demand for peanuts decreases.
d. the quantity demanded of peanuts
increases.
____ 21. Assume that smart phones and fit bits and are complements. When the price of smart phones increases:
a. the supply of fit bits decreases.
c. the supply of fit bits increases.
b. the demand for fit bits increases.
d. the demand for fit bits decreases.
____ 22. Suppose that a product benefits from a successful advertising campaign. The result is that:
a. the demand for the product increases.
c. the supply of the product decreases.
b. the demand for the product decreases.
d. the supply of the product increases.
____ 23. Suppose that consumers expect that the price of a product will increase in the future. The result is that:
a. the current supply of the product
c. the current supply of the product
increases.
decreases.
.
b. the current demand for the product
d. the current demand for the product
decreases.
increases.
____ 24. Two goods are complements if:
a. the supply of one good decreases when the c. the demand for one good decreases when
price of the other decreases.
the price of the other increases.
b. the supply of one good decreases when the d. the demand for one good decreases when
price of the other increases.
the price of the other decreases.
____ 25. Suppose the consumption of oat bran is found to reduce cholesterol and improve health. The result is
that:
a. demand for oat bran increases.
c. the supply of oat bran increases.
b. demand for oat bran decreases.
d. Both A and C are correct.
____ 26. Suppose that consumers expect the price of the product to decrease in the future. The result is that:
a. the current supply of the product
c. the current demand for the product
decreases.
increases.
b. the current supply of the product
d. the current demand for the product
decreases.
decreases.
____ 27. Assume that tortilla chips and salsa are complements. When the price of tortilla chips decreases:
a. the demand for salsa decreases.
c. the demand for salsa increases.
b. the demand for tortilla chips decreases.
d. the supply of salsa decreases.
____ 28. An inferior good is defined as a good for which demand decreases when:
a. the price increases.
c. the price decreases.
b. income increases.
d. income decrease.
____ 29. Hops are used to produce beer, (as if college students did not know that), if the price of hops decreases:
a. the demand for beer increases.
c. the supply of beer decreases.
b. the supply of beer increases.
d. the demand for beer decreases.
____ 30. If the number of beer producers’ decreases:
a. the supply of beer decreases.
b. the demand for beer decreases.
c. the demand for beer increases.
d. the supply of beer increases.
____ 31. The price of oranges has risen dramatically. Which of the following is likely to happen?
a. the quantity of oranges supplied will
c. the quantity of oranges supplied will
increase.
decrease.
b. the supply of oranges will increase.
d. the supply of oranges will decrease.
____ 32. The price of I-phones has fallen dramatically. Which of the following is likely to happen?
a. supply of I-phones will decrease.
c. quantity supplied of I-phones will
increase.
b. supply of I-phones will increase.
d. quantity supplied of I-phones will
decrease.
____ 33. Flour is used to produce bread. If the price of flour increases:
a. the supply of bread decreases.
c. the supply of bread increases.
b. the demand for bread increases.
d. the demand for bread decreases.
____ 34. If a technological advance makes it possible to produce bananas at a lower cost:
a. the demand for bananas decreases.
c. the demand for bananas increases.
b. the supply of bananas decreases.
d. the supply of bananas increases.
____ 35. If the number of banana producers’ increases:
a. the demand for bananas decreases.
b. the supply of bananas decreases.
c. the supply of bananas increases.
d. the demand for bananas increases.