Question 1

Given your budget constraint $60j + $20s = $300 and the graph above,what is the opportunity cost of a sweater?

Accepted Answer

A) $ \frac{1}{3} $ of a pair of jeans 
B)  $ \frac{1}{2} $ of a pair of jeans 
C)  1 pair of jeans 
D)  3 pairs of jeans 
A) $ \frac{1}{3} $ of a pair of jeans 
B)  $ \frac{1}{2} $ of a pair of jeans 
C)  1 pair of jeans 
D)  3 pairs of jeans

Question 2

If the quantity of tea is measured on the horizontal axis and the quantity of coffee is measured on the vertical axis,an increase in the price of coffee will cause a budget constraint to ________.

Accepted Answer

A)  pivot leftward along the vertical axis 
B)  pivot rightward along the vertical axis 
C)  pivot leftward along the horizontal axis 
D)  pivot rightward along the horizontal axis 
A)  pivot leftward along the vertical axis 
B)  pivot rightward along the vertical axis 
C)  pivot leftward along the horizontal axis 
D)  pivot rightward along the horizontal axis

Question 3

When the price of a flashlight is $5,the number of flashlights demanded is 600 units.When the price increases to $20 per unit,the quantity demanded falls to 200 units.Moreover,if the price of the cells used to operate these flashlights falls by 200 percent,the demand for flashlights increases from 200 units to 300 units.
a)Calculate the arc price elasticity of demand.
b)Calculate the cross-price elasticity of demand.
c)When Joe earns $30,he purchases 20 flashlights.When his income increases to $120,his quantity demanded increases to 60 units.Calculate Joe's income elasticity of demand for flashlights.

Accepted Answer

a)Arc price elasticity of demand = [(200

Question 4

Given your budget constraint $60j + $20s = $300 and the graph above,what is the opportunity cost of a pair of jeans?

Accepted Answer

A)  $ \frac{1}{3} $ of a sweater 
B)  1 sweater 
C)  2 sweaters 
D)  3 sweaters 
A)  $ \frac{1}{3} $ of a sweater 
B)  1 sweater 
C)  2 sweaters 
D)  3 sweaters

Question 5

A consumer's budget refers to the ________.

Accepted Answer

A)  wealth the consumer has acquired over time 
B)  average prices of the goods and services bought by the consumer 
C)  amount of money the consumer can spend on various goods and services 
D)  difference between the consumer's willingness to pay for goods and services and the amount actually paid. 
A)  wealth the consumer has acquired over time 
B)  average prices of the goods and services bought by the consumer 
C)  amount of money the consumer can spend on various goods and services 
D)  difference between the consumer's willingness to pay for goods and services and the amount actually paid.

Question 6

The following table shows the benefit that Evan derives from consuming pizza. The price of a slice of pizza is $4.
  
-Refer to the table above.The optimal number of slices of pizza for Evan is ________,and he will get ________ in consumer surplus from it.

Accepted Answer

A)  4; $15 
B)  3; $12 
C)  1; $8 
D)  2; $10 
A)  4; $15 
B)  3; $12 
C)  1; $8 
D)  2; $10

Question 7

For an individual,consumer surplus measures ________.

Accepted Answer

A)  willingness to pay 
B)  the price paid for the good 
C)  willingness to pay less the price paid for the good 
D)  willingness to pay plus the price paid for the good 
A)  willingness to pay 
B)  the price paid for the good 
C)  willingness to pay less the price paid for the good 
D)  willingness to pay plus the price paid for the good

Question 8

The following figure displays John's budget constraint when he spends his income on tables and chairs.
  
-Refer to the figure above.If John decides to spend his entire income on tables and the price of a table is $2,what is John's income?

Accepted Answer

A)  $20 
B)  $40 
C)  $60 
D)  $80 
A)  $20 
B)  $40 
C)  $60 
D)  $80

Question 9

Which of the following statements is true of the price elasticity of demand?

Accepted Answer

A)  As the number of substitutes for a good increases, the price elasticity of demand for that good decreases. 
B)  If a consumer's budget share of a good increases, the price elasticity of demand for that good is likely to decrease. 
C)  The price elasticity of demand for a good is generally higher in the long run than in the short run. 
D)  If the price elasticity of demand for a good equals zero, the demand for the good is likely to be highly responsive to price changes. 
A)  As the number of substitutes for a good increases, the price elasticity of demand for that good decreases. 
B)  If a consumer's budget share of a good increases, the price elasticity of demand for that good is likely to decrease. 
C)  The price elasticity of demand for a good is generally higher in the long run than in the short run. 
D)  If the price elasticity of demand for a good equals zero, the demand for the good is likely to be highly responsive to price changes.

Question 10

The following figure shows the market demand curve for calculators.
  
-Refer to the figure above.What is the gain in the market-wide consumer surplus when the price of calculators changes from $6 per unit to $3 per unit?

Accepted Answer

A)  $565 
B)  $580 
C)  $950 
D)  $1,050 
A)  $565 
B)  $580 
C)  $950 
D)  $1,050

Question 11

________ is a measure of the satisfaction or happiness that comes from consuming a good or service.

Accepted Answer

A)  A budget 
B)  Utility 
C)  The income effect 
D)  The substitution effect 
A)  A budget 
B)  Utility 
C)  The income effect 
D)  The substitution effect

Question 12

The following figure shows the market demand curve for calculators.
  
-Refer to the figure above.What is the market-wide consumer surplus when the market price of calculators is $3 per unit?

Accepted Answer

A)  $600 
B)  $725 
C)  $1,000 
D)  $1,120 
A)  $600 
B)  $725 
C)  $1,000 
D)  $1,120

Question 13

The Law of Demand explains why ________.

Accepted Answer

A)  the price elasticity of demand has a positive value 
B)  the income elasticity of demand has a positive value 
C)  the price elasticity of demand has a negative value 
D)  the income elasticity of demand has a negative value 
A)  the price elasticity of demand has a positive value 
B)  the income elasticity of demand has a positive value 
C)  the price elasticity of demand has a negative value 
D)  the income elasticity of demand has a negative value

Question 14

As the ________ increases,________.

Accepted Answer

A)  quantity demanded of a good; its price increases 
B)  quantity demanded of a good; its price decreases 
C)  price of a good; its quantity demanded increases 
D)  price of a good; its quantity demanded decreases 
A)  quantity demanded of a good; its price increases 
B)  quantity demanded of a good; its price decreases 
C)  price of a good; its quantity demanded increases 
D)  price of a good; its quantity demanded decreases

Question 15

In a perfectly competitive market,all consumers ________.

Accepted Answer

A)  may buy one or many unit of the good, without the price changing 
B)  bid the lowest price for the good they want to consume 
C)  tend to buy equal amounts of a good 
D)  have exactly the same tastes and preferences 
A)  may buy one or many unit of the good, without the price changing 
B)  bid the lowest price for the good they want to consume 
C)  tend to buy equal amounts of a good 
D)  have exactly the same tastes and preferences

Question 16

Consider the following demand curve.Which statement is true?

Accepted Answer

A)  The price elasticity of demand is larger in point A, compared to point B. 
B)  The price elasticity of demand is smaller in point A, compared to point B. 
C)  The price elasticity of demand is in point A and point B are equal. 
D)  The price elasticity of demand is positive in point A, but negative in point B. 
A)  The price elasticity of demand is larger in point A, compared to point B. 
B)  The price elasticity of demand is smaller in point A, compared to point B. 
C)  The price elasticity of demand is in point A and point B are equal. 
D)  The price elasticity of demand is positive in point A, but negative in point B.

Question 17

When the price of a bar of chocolate is $2,Sharon consumes 10 chocolates.If her arc elasticity of demand for chocolates is −1,how many bars of chocolates will she consume when the price increases to $4?

Accepted Answer

A)  5 
B)  6 
C)  8 
D)  9 
A)  5 
B)  6 
C)  8 
D)  9

Question 18

When the price of one burger is $4,Kate consumes 2 burgers.When the price of one burger decreases to $2,she consumes 4 burgers.Given the information,what is the absolute value of Kate's arc elasticity of demand for burgers?

Accepted Answer

A)  1.2 
B)  1.0 
C)  4 
D)  5 
A)  1.2 
B)  1.0 
C)  4 
D)  5

Question 19

The following table shows the total benefit that Jenny derives from consuming different quantities of chocolate.
  
-Refer to the table above.What is the marginal benefit that Jenny derives from the second unit of chocolate?

Accepted Answer

A)  $0 
B)  $8 
C)  $9 
D)  $18 
A)  $0 
B)  $8 
C)  $9 
D)  $18

Question 20

The following figure shows a consumer's budget constraint for jeans and sweaters.
  
-Refer to the figure above.Suppose the price of a sweater is $3.If the budget constraint of a consumer is B₃,then her income will be equal to ________.

Accepted Answer

A)  $45 
B)  $90 
C)  $135 
D)  $270 
A)  $45 
B)  $90 
C)  $135 
D)  $270

Given your budget constraint $60j + $20s = $300 and the graph above,what is the opportunity cost of a sweater?

If the quantity of tea is measured on the horizontal axis and the quantity of coffee is measured on the vertical axis,an increase in the price of coffee will cause a budget constraint to ________.

Given your budget constraint $60j + $20s = $300 and the graph above,what is the opportunity cost of a pair of jeans?

A consumer's budget refers to the ________.

The following table shows the benefit that Evan derives from consuming pizza. The price of a slice of pizza is $4. -Refer to the table above.The optimal number of slices of pizza for Evan is ,and he will get in consumer surplus from it.

For an individual,consumer surplus measures ________.

The following figure displays John's budget constraint when he spends his income on tables and chairs. -Refer to the figure above.If John decides to spend his entire income on tables and the price of a table is $2,what is John's income?

Which of the following statements is true of the price elasticity of demand?

The following figure shows the market demand curve for calculators. -Refer to the figure above.What is the gain in the market-wide consumer surplus when the price of calculators changes from $6 per unit to $3 per unit?

________ is a measure of the satisfaction or happiness that comes from consuming a good or service.

The following figure shows the market demand curve for calculators. -Refer to the figure above.What is the market-wide consumer surplus when the market price of calculators is $3 per unit?

The Law of Demand explains why ________.

As the increases,.

In a perfectly competitive market,all consumers ________.

Consider the following demand curve.Which statement is true?

When the price of a bar of chocolate is $2,Sharon consumes 10 chocolates.If her arc elasticity of demand for chocolates is −1,how many bars of chocolates will she consume when the price increases to $4?

When the price of one burger is $4,Kate consumes 2 burgers.When the price of one burger decreases to $2,she consumes 4 burgers.Given the information,what is the absolute value of Kate's arc elasticity of demand for burgers?

The following table shows the total benefit that Jenny derives from consuming different quantities of chocolate. -Refer to the table above.What is the marginal benefit that Jenny derives from the second unit of chocolate?

The following figure shows a consumer's budget constraint for jeans and sweaters. -Refer to the figure above.Suppose the price of a sweater is $3.If the budget constraint of a consumer is B₃,then her income will be equal to ________.

The Principles and Practice of Economics

Economic Methods and Economic Questions

Optimization: Doing the Best You Can

Demand, supply, and Equilibrium

Sellers and Incentives

Perfect Competition and the Invisible Hand

Trade

Externalities and Public Goods

The Government in the Economy: Taxation and Regulation

Markets for Factors of Production

Monopoly

Game Theory and Strategic Play

Oligopoly and Monopolistic Competition

Trade-Offs Involving Time and Risk

The Economics of Information

Auctions and Bargaining

Social Economics

Filters

Exam 5: Consumers and Incentives

Given your budget constraint $60j + $20s = $300 and the graph above,what is the opportunity cost of a sweater?

If the quantity of tea is measured on the horizontal axis and the quantity of coffee is measured on the vertical axis,an increase in the price of coffee will cause a budget constraint to ________.

Given your budget constraint $60j + $20s = $300 and the graph above,what is the opportunity cost of a pair of jeans?

A consumer's budget refers to the ________.

The following table shows the benefit that Evan derives from consuming pizza. The price of a slice of pizza is $4. -Refer to the table above.The optimal number of slices of pizza for Evan is ________,and he will get ________ in consumer surplus from it.

For an individual,consumer surplus measures ________.

The following figure displays John's budget constraint when he spends his income on tables and chairs. -Refer to the figure above.If John decides to spend his entire income on tables and the price of a table is $2,what is John's income?

Which of the following statements is true of the price elasticity of demand?

The following figure shows the market demand curve for calculators. -Refer to the figure above.What is the gain in the market-wide consumer surplus when the price of calculators changes from $6 per unit to $3 per unit?

________ is a measure of the satisfaction or happiness that comes from consuming a good or service.

The following figure shows the market demand curve for calculators. -Refer to the figure above.What is the market-wide consumer surplus when the market price of calculators is $3 per unit?

The Law of Demand explains why ________.

As the ________ increases,________.

In a perfectly competitive market,all consumers ________.

Consider the following demand curve.Which statement is true?

When the price of a bar of chocolate is $2,Sharon consumes 10 chocolates.If her arc elasticity of demand for chocolates is −1,how many bars of chocolates will she consume when the price increases to $4?

When the price of one burger is $4,Kate consumes 2 burgers.When the price of one burger decreases to $2,she consumes 4 burgers.Given the information,what is the absolute value of Kate's arc elasticity of demand for burgers?

The following table shows the total benefit that Jenny derives from consuming different quantities of chocolate. -Refer to the table above.What is the marginal benefit that Jenny derives from the second unit of chocolate?

The following figure shows a consumer's budget constraint for jeans and sweaters. -Refer to the figure above.Suppose the price of a sweater is $3.If the budget constraint of a consumer is B₃,then her income will be equal to ________.

The Principles and Practice of Economics

Economic Methods and Economic Questions

Optimization: Doing the Best You Can

Demand, supply, and Equilibrium

Sellers and Incentives

Perfect Competition and the Invisible Hand

Trade

Externalities and Public Goods

The Government in the Economy: Taxation and Regulation

Markets for Factors of Production

Monopoly

Game Theory and Strategic Play

Oligopoly and Monopolistic Competition

Trade-Offs Involving Time and Risk

The Economics of Information

Auctions and Bargaining

Social Economics

Filters

The following table shows the benefit that Evan derives from consuming pizza. The price of a slice of pizza is $4. -Refer to the table above.The optimal number of slices of pizza for Evan is ,and he will get in consumer surplus from it.

As the increases,.