ECON 300 EXAM 1 QUESTIONS AND ANSWERS
100% CORRECT | NEW UPDATE 2026
What would NOT cause the demand for coke to shift? - ANSWERS The cost of
producing coke increases
What would cause the supply curve to shift to the left? - ANSWERS An
increase in the cost of raw materials
If price of beef decreases, then what will happen to the demand for chicken? -
ANSWERS Decrease
(because they are substitutes)
If price of gas decreases, then what will happen to the demand for cars? -
ANSWERS Increase
(because they are complements)
If the price of gas increases, then what will happen to the demand for cars? -
ANSWERS Decrease
(because they are complements)
Hot weather causes the demand curve for ice cream to shift to the right. Why will
prices rise to a new market-clearing level? - ANSWERS -Shift demand curve to
the right
-Initially creating a shortage
, -Price rises to where Qs equals Qd
What would NOT occur if the market price was above the market-clearing price? -
ANSWERS Consumers would bid up the price
(this would NOT happen)
Things that happen if the market price is above market-clearing price: -
ANSWERS 1. Producers lower their prices to sell off excess inventory
2. Producers want to produce and sell more than consumers want to buy
3. There is a surplus
A price and quantity consumed both increased from one year to the next. What
probably happened? - ANSWERS Demand increased and supply remained
constant
***What factors determine the size of a shortage?
The extend of the excess demand implied by the shortages will depend on: -
ANSWERS The elasticities of supply and demand, where the shortages will be
larger is both supply and demand are more elastic
If the prices of beef and chicken are set below market-clearing levels, what will
happen to the price of pork? - ANSWERS Increase
(because they are substitutes)
Since beef and chicken are below market-clearing price, demand will increase
resulting in a shortage. Therefore, the price of pork will go up because it is a
substitute (and people will be able to find it when there is a shortage of the other
two meats)
100% CORRECT | NEW UPDATE 2026
What would NOT cause the demand for coke to shift? - ANSWERS The cost of
producing coke increases
What would cause the supply curve to shift to the left? - ANSWERS An
increase in the cost of raw materials
If price of beef decreases, then what will happen to the demand for chicken? -
ANSWERS Decrease
(because they are substitutes)
If price of gas decreases, then what will happen to the demand for cars? -
ANSWERS Increase
(because they are complements)
If the price of gas increases, then what will happen to the demand for cars? -
ANSWERS Decrease
(because they are complements)
Hot weather causes the demand curve for ice cream to shift to the right. Why will
prices rise to a new market-clearing level? - ANSWERS -Shift demand curve to
the right
-Initially creating a shortage
, -Price rises to where Qs equals Qd
What would NOT occur if the market price was above the market-clearing price? -
ANSWERS Consumers would bid up the price
(this would NOT happen)
Things that happen if the market price is above market-clearing price: -
ANSWERS 1. Producers lower their prices to sell off excess inventory
2. Producers want to produce and sell more than consumers want to buy
3. There is a surplus
A price and quantity consumed both increased from one year to the next. What
probably happened? - ANSWERS Demand increased and supply remained
constant
***What factors determine the size of a shortage?
The extend of the excess demand implied by the shortages will depend on: -
ANSWERS The elasticities of supply and demand, where the shortages will be
larger is both supply and demand are more elastic
If the prices of beef and chicken are set below market-clearing levels, what will
happen to the price of pork? - ANSWERS Increase
(because they are substitutes)
Since beef and chicken are below market-clearing price, demand will increase
resulting in a shortage. Therefore, the price of pork will go up because it is a
substitute (and people will be able to find it when there is a shortage of the other
two meats)
