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1. In drawing an individual’s demand curve for a commodity, all but which one of the following are kept constant?


1. The individual’s money income


2. the price of other commodities


3. the price of the commodity under consideration


4. the tastes of the individual


2. The individual’s demand curve for a commodity represents


1. a maximum boundary of the individual’s intentions


2. a minimum boundary of the individual’s intentions


3. both a maximum and a minimum boundary of the individual’s intentions


4. neither a maximum nor a minimum boundary of the individual’s intentions


3. A fall in the price of a commodity, holding everything else constant, results in and is referred to as


1. an increase in demand


2. a decrease in demand


3. an increase in the quantity demanded


4. a decrease in the quantit demanded


4. When an individual’s income rises (while everything else remains the same), that person’s demand for a normal good


1. rises


2. falls


3. remains the same


4. any of the above


5. When an individual’s income falls (while everything else remains the same), that person’s demand for an inferior good


1. increases


2. decreases


3. remains unchanged


4. we cannot say without additional information


6. When the price of a substitute of commodity X falls, the demand for X


1. rises


2. falls


3. remains unchanged


4. any of the above


7. When both the price of a substitute and the price of a complement of commodity X rise, the demand for X


1. rises


2. falls


3. remains unchanged


4. all of the above are possible


8. In drawing a farmer’s supply curve for a commodity, all but which one of the following are kept constant?


1. Technology


2. the prices of inputs


3. features of nature such as climate and weather conditions


4. the price of the commodity under consideration


9. A producer’s positively sloped supply curve for a commodity represents


1. a maximum boundary of the producer’s intentions


2. a minimum boundary of the producer’s intentions


3. in one sense a maximum and in another sense a minimum boundary of the producer’s intentions


4. none of the above


10. If the supply curve of a commodity is positively sloped, a rise in the price of the commodity, ceteris paribus, results in and is referred to as


1. an increase in supply


2. an increase in the quantity supplied


3. a decrease in supply


4. a decrease in the quantity supplied


11. When the market supply curve for a commodity is negatively sloped, we have a case of


1. stable equilibrium


2. unstable equilibrium


3. any of the above is possible and we cannot say without additional information


4. None of the above


12. If, from a position of stable equilibrium, the market supply of a commodity decreases while the market demand remains unchanged


1. the equilibrium price falls


2. the equilibrium quantity rises


3. both the equilibrium price and the equilibrium quantity decrease


4. the equilibrium price rises but the equilibrium quantity falls