Question

                                    Table#2-Supply for Macabee Coffee Beans

Quantity Supplied Per Week (Millions of Bushels)	Price Per Bushel
6	$3.00
5	2.50
4	2.00
3	1.50
2	1.00
1	0.80

(52)In reference to Table#2 above, assume the price of Macabee’s coffee beans to be $0.90 per bushel. If the price were to increase to $2.40 per bushel, given ceteris paribus, the result would be a (an):

(a)Decrease in demand

(b)Increase in quantity supplied

(c)Increase in supply

(d)Any of the above

(51)Which of the following statements is true?

A decrease in the quantity supplied of a good given ceteris paribus is given by a (n):

(a)A shift to the right in the supply curve

(b)A downward movement to the left along the supply curve

(c)An upward movement to the right along the supply curve

(d)A shift to the left in the supply curve

49)Given ceteris paribus if consumers expect that the price of grapes will increase in the next four months, their demand curve for grapes will:

(a)Shift inwardly to the left

(b)Rotate outwardly to the right

(c)Shift outwardly to the right

(d)Remain unchanged

53)A movement along the demand curve for toothbrush given ceteris paribus is caused by a change in:

(a)The price of toothpaste

(b)The price of dental care

(c)The price of toothbrush

(d)Consumers’ perspectives of future price changes

Answer 1

52. Ans: Increase in quantity supplied

Explanation:

When price increases, given ceteris paribus, quantity supplied increases. Because their is a positive relationship between price and quantity supplied .

Thus, option [b] is correct answer.

51. Ans: A shift to the left in the supply curve

49. Ans: Shift outwardly to the right

Explanation:

When consumers expect the price will increase in future, they can purchase more grapes at present. So, the demand curve will shift rightward.

Thus, option [c] is correct answer.

53. Ans: The price of toothbrush

Explanation:

A change in own price of a good leads to movement along the demand curve and any change in other factors other than price leads to a shift in the demand curve. So, when toothbrush price changes, it will cause A movement along the demand curve for toothbrush given ceteris paribus.

Thus, option [c] is correct answer.