ECON 300 EXAM 1 | 122 QUESTIONS WITH
CORRECT ANSWERS 2026 GRADED A+
When demand increases: -Correct Answer ✔-the demand curve shifts to the right.
What will not cause demand for apples to increase or decrease? -Correct Answer ✔-a
reduction in the price of apples
If the price of crude oil increases and the number of people who own cars falls: -Correct
Answer ✔-the equilibrium price of gasoline will be uncertain and equilibrium quantity of
gasoline will decrease.
If the price of crude oil decreases: -Correct Answer ✔-the equilibrium price of gasoline
will decrease and equilibrium quantity of gasoline will increase.
If the supply curve is QS = 4P − 4, then the highest price at which no producer is willing
to sell the good (i.e. the supply choke price) is: -Correct Answer ✔-1.
If the demand curve is QD = 10 − 2P, then the lowest price at which no consumer is
willing to buy the good (i.e., the demand choke price) is: -Correct Answer ✔-5.
When the prevailing price is above the price where supply intersects demand: -Correct
Answer ✔-price falls because there is a surplus, so producers cut prices to try to attract
buyers.
Which of the following would cause an increase in the quantity demanded of pizza? -
Correct Answer ✔-an increase in the supply of pizza
If demand increases and supply increases: -Correct Answer ✔-equilibrium price will be
uncertain and equilibrium quantity will increase.
If supply decreases: -Correct Answer ✔-equilibrium price increases and equilibrium
quantity decreases.
If supply increases and demand decreases: -Correct Answer ✔-equilibrium price will
decrease and equilibrium quantity will be uncertain.
If demand decreases: -Correct Answer ✔-equilibrium price decreases and equilibrium
quantity decreases.
If the inverse demand curve is P = 12 − 2QD and the inverse supply curve is P = 4QS,
then the equilibrium price and quantity are: -Correct Answer ✔-Pe = 8; Qe = 2.
, A decrease in supply: -Correct Answer ✔-creates excess demand, causing equilibrium
price to increase.
A decrease in demand: -Correct Answer ✔-produces excess supply, causing equilibrium
price to decrease.
The impact of an increase in demand on equilibrium price will be bigger when: -Correct
Answer ✔-supply is steeper.
When the prevailing price is below the price where supply intersects demand: -Correct
Answer ✔-price rises because a shortage, so buyers bid up the price.
If the cross-price elasticity between two goods is positive, then the goods are: -Correct
Answer ✔-substitutes.
If the income elasticity of a good is positive, then the good is: -Correct Answer ✔-
normal.
If the absolute value of the price elasticity of demand is 2, then demand is: -Correct
Answer ✔-elastic.
The price elasticity of demand of a good whose demand curve is linear with a slope of
−4: -Correct Answer ✔-decreases as quantity increases.
The demand curve of a good is QD = 10 −2P. When P = 5, demand is: -Correct Answer
✔-perfectly inelastic.
When demand and supply are linear, consumer surplus is equal to: -Correct Answer ✔-
The area between the demand curve and the price, out to the quantity that is
exchanged.
When demand and supply are linear, producer surplus is equal to: -Correct Answer ✔-
The area between the supply curve and the price, out to the quantity that is exchanged.
When demand and supply are linear, consumer surplus is calculated as the area of a
triangle: -Correct Answer ✔-with a base equal to the quantity sold and a height equal to
the difference between the market price and the demand choke price.
When demand and supply are linear, producer surplus can be calculated: -Correct
Answer ✔-with a base equal to the quantity sold and a height equal to the difference
between the market price and the supply choke price.
CORRECT ANSWERS 2026 GRADED A+
When demand increases: -Correct Answer ✔-the demand curve shifts to the right.
What will not cause demand for apples to increase or decrease? -Correct Answer ✔-a
reduction in the price of apples
If the price of crude oil increases and the number of people who own cars falls: -Correct
Answer ✔-the equilibrium price of gasoline will be uncertain and equilibrium quantity of
gasoline will decrease.
If the price of crude oil decreases: -Correct Answer ✔-the equilibrium price of gasoline
will decrease and equilibrium quantity of gasoline will increase.
If the supply curve is QS = 4P − 4, then the highest price at which no producer is willing
to sell the good (i.e. the supply choke price) is: -Correct Answer ✔-1.
If the demand curve is QD = 10 − 2P, then the lowest price at which no consumer is
willing to buy the good (i.e., the demand choke price) is: -Correct Answer ✔-5.
When the prevailing price is above the price where supply intersects demand: -Correct
Answer ✔-price falls because there is a surplus, so producers cut prices to try to attract
buyers.
Which of the following would cause an increase in the quantity demanded of pizza? -
Correct Answer ✔-an increase in the supply of pizza
If demand increases and supply increases: -Correct Answer ✔-equilibrium price will be
uncertain and equilibrium quantity will increase.
If supply decreases: -Correct Answer ✔-equilibrium price increases and equilibrium
quantity decreases.
If supply increases and demand decreases: -Correct Answer ✔-equilibrium price will
decrease and equilibrium quantity will be uncertain.
If demand decreases: -Correct Answer ✔-equilibrium price decreases and equilibrium
quantity decreases.
If the inverse demand curve is P = 12 − 2QD and the inverse supply curve is P = 4QS,
then the equilibrium price and quantity are: -Correct Answer ✔-Pe = 8; Qe = 2.
, A decrease in supply: -Correct Answer ✔-creates excess demand, causing equilibrium
price to increase.
A decrease in demand: -Correct Answer ✔-produces excess supply, causing equilibrium
price to decrease.
The impact of an increase in demand on equilibrium price will be bigger when: -Correct
Answer ✔-supply is steeper.
When the prevailing price is below the price where supply intersects demand: -Correct
Answer ✔-price rises because a shortage, so buyers bid up the price.
If the cross-price elasticity between two goods is positive, then the goods are: -Correct
Answer ✔-substitutes.
If the income elasticity of a good is positive, then the good is: -Correct Answer ✔-
normal.
If the absolute value of the price elasticity of demand is 2, then demand is: -Correct
Answer ✔-elastic.
The price elasticity of demand of a good whose demand curve is linear with a slope of
−4: -Correct Answer ✔-decreases as quantity increases.
The demand curve of a good is QD = 10 −2P. When P = 5, demand is: -Correct Answer
✔-perfectly inelastic.
When demand and supply are linear, consumer surplus is equal to: -Correct Answer ✔-
The area between the demand curve and the price, out to the quantity that is
exchanged.
When demand and supply are linear, producer surplus is equal to: -Correct Answer ✔-
The area between the supply curve and the price, out to the quantity that is exchanged.
When demand and supply are linear, consumer surplus is calculated as the area of a
triangle: -Correct Answer ✔-with a base equal to the quantity sold and a height equal to
the difference between the market price and the demand choke price.
When demand and supply are linear, producer surplus can be calculated: -Correct
Answer ✔-with a base equal to the quantity sold and a height equal to the difference
between the market price and the supply choke price.
