Assume that other things are remaining equal when answering the following

questions:

1) The law of demand tells us that as the price of a good rises, the demand for it
decreases. F
2) The law of demand tells us that as the price of a good rises, the quantity of
the good demanded decreases, T
3) If the quantity of concert tickets demanded exceeds the quantity available,
then the quantity of tickets traded will be less than the quantity of tickets
demanded, T
4) An increase in the price of tickets to the Australian Football Grand Final will
shift the demand curve for such tickets to the left . F
5) If Big Macs and milkshakes are complements and McDonald’s reduces the
price of milkshakes, the demand for Big Macs will increase. T
6) If an increase in household income leads to a fall in the demand for
sausages, this implies that sausages are inferior goods. T
7) The demand curve for a good shows the minimum price that consumers are
willing to pay for the last unit of the good bought. F
8) The growing concern for the environment has led Australians to favor
environmentally friendly goods such as unbleached bathroom tissues and
organically grown vegetables. Such a change in consumers tastes
represents a shift to the right of the demand curve for environmentally friendly
goods. T
9) The law of supply implies that a supply curve will have a negative slope. F
10) An increase in the price of kangaroo steak will lead to a shift in the supply
curve of kangaroo in the short run. F
11) If the current price of Tasmanian salmon is such that the quantity demanded
exceeds quantity supplied, we can expect an increase in the price of
Tasmanian salmon. T
12) A technological breakthrough that greatly reduces the cost of farming Sydney
rock oysters will shift the supply of Sydney rock oysters to the right. T
13) If the demand for swimwear decreases because Vietnamese are frighten of
getting skin cancer, we could predict a decrease in the price of swimwear and
an increase in the quantity of swimwear sold. F
14) If Weet-Bix and Vita-Brits are substitutes in the eyes of breakfast cereal
eaters, an increase in the price of Weet-Bix will lead to an increase in the
demand for Vita-Brits. T
15) When a cow is slaughtered for beef, its hide becomes available to make
leather. If the price of beef rises, we would expect to see an increase in the
supply of leather, and in the quantity of beef supplied. T
16) An increase in the price of hops, an important raw material in the production
of beer, could be expected to lead to an increase in the price of beer. T

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17) An increase in the price of merino wool and a decrease in the quantity of
merino wool traded are consistent with a decrease in the demand for merino
wool. F
18) If beef mince is considered by most Vietnamese as an inferior good, an
increase in the average income of Vietnamese households will lead to a
decrease in the price and in the quantity traded of beef mince. T
19) If the demand and the supply of cars increased simultaneously, we can
confidently predict an increase in the price of cars. F
20) Graziers can use their pastures to grow sheep or cattle. An increase in the
demand for beef will lead to a decrease in the supply of wool. T