Ch. 2
1. A relationship that shows the quantity of goods that consumers are willing to buy at different prices is the
A) elasticity
B) market demand curve
C) market supply curve
D) market equilibrium

2. The law of demand states :
A) that price and quantity demanded are inversely related.
B) that price and quantity demanded are inversely related, holding all other factors that influence demand fixed.
C) that demand for a good comes from the desire of buyers to directly consume the good itself.
D) an increase in demand results in an increase in price.

3. Which of the following statements best illustrates the law of demand?
A) When the price of pepperoni rises, the demand for pizza falls.
B) When the weather gets hotter, the quantity demanded of ice cream rises.
C) When the price of lemons falls, the demand for lemonade rises.
D) When the price of eggs rises, the quantity demanded of eggs falls.

4. Which of the following is not typically a factor held constant when deriving a demand curve for clothing?
A) consumer income.
B) the price of clothing.
C) the price of other goods.
D) consumer tastes.

5. What is the difference between a derived demand curve and a direct demand curve?
A) Derived demand is unknown, whereas direct demand is known.
B) Derived demand is unobservable, whereas direct demand is observable.
C) Derived demand is demand determined by the demand for another good, whereas direct demand is demand for a good itself.
D) Derived and direct demand are both terms referring to the same thing.

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6. What is the quantity of televisions demanded per year when the average price of a television is $100 per unit and the demand curve for televisions is represented by Qd =
3.5million – 5000P?
A) 2.5 million televisions
B) 3.0 million televisions
C) 3.2 million televisions
D) 4.0 million televisions

9. Which of