Question 1

Consider the demand functions:A)Qd = 250 - 2P B)Qd = 300 - 3P. Which of the demand functions reflects a higher level of consumer incomes?

Accepted Answer

A) A 
B) B 
C) A and B reflect the same consumer incomes. 
D) More information is needed. 
A) A 
B) B 
C) A and B reflect the same consumer incomes. 
D) More information is needed. D

Question 2

Suppose society wants to increase the number of teachers in society but doesn't want to pay teachers any more in salary and benefits.This could only occur by

Accepted Answer

A)  making it more expensive to become a teacher, perhaps by raising college tuition rates. 
B)  making it less expensive to become a teacher, perhaps by offering subsidies to college tuition. 
C)  making computers more powerful. 
D)  increasing the income of student parents. 
A)  making it more expensive to become a teacher, perhaps by raising college tuition rates. 
B)  making it less expensive to become a teacher, perhaps by offering subsidies to college tuition. 
C)  making computers more powerful. 
D)  increasing the income of student parents. B

Question 3

The quantity of a good that consumers demand depends only on the price of the good.

Accepted Answer

A) True 
 B)False  False

Question 4

Suppose the market for potatoes can be expressed as follows:
Supply: QS = -20 + 10p
Demand: QD = 400 - 20p
If the government sets a maximum price of $10 per unit,what will be the quantity demanded and quantity supplied?

Accepted Answer

With a maximum price of $10,suppliers wi

Question 5

The fact that many people drive faster than the posted speed limit suggests that

Accepted Answer

A)  not all price floors are enforceable. 
B)  not all price and quantity regulations are enforceable. 
C)  individual drivers act irrationally. 
D)  government regulation is utterly useless. 
A)  not all price floors are enforceable. 
B)  not all price and quantity regulations are enforceable. 
C)  individual drivers act irrationally. 
D)  government regulation is utterly useless.

Question 6

Suppose the demand for a particular product can be expressed as Q = 100/p.Calculate the total amount spent on this good when p = 10,20,and 50.Can you make a generalization about the mathematical form of this demand curve and consumer behavior in this market?

Accepted Answer

In all cases,total expenditure equals 10

Question 7

Municipalities that have adopted the policy of "rent control" typically set the rentals on certain apartments well below equilibrium.As a result,

Accepted Answer

A)  landlords have a difficult time finding tenants. 
B)  prospective tenants have a difficult time finding available apartments. 
C)  there is a surplus of apartments. 
D)  All of the above. 
A)  landlords have a difficult time finding tenants. 
B)  prospective tenants have a difficult time finding available apartments. 
C)  there is a surplus of apartments. 
D)  All of the above.

Question 8

If the demand for high definition televisions increases and the supply of high definition televisions increases,then

Accepted Answer

A)  it is clear that prices will increase; the change in the quantity of televisions sold is ambiguous. 
B)  it is clear that prices will decrease; the change in the quantity of televisions sold is ambiguous. 
C)  it is clear that quantity sold will increase; the change in the price of televisions is ambiguous. 
D)  it is clear that quantity sold will decrease; the change in the price of televisions is ambiguous. 
A)  it is clear that prices will increase; the change in the quantity of televisions sold is ambiguous. 
B)  it is clear that prices will decrease; the change in the quantity of televisions sold is ambiguous. 
C)  it is clear that quantity sold will increase; the change in the price of televisions is ambiguous. 
D)  it is clear that quantity sold will decrease; the change in the price of televisions is ambiguous.

Question 9

A competitive equilibrium is described by

Accepted Answer

A)  a price only. 
B)  a quantity only. 
C)  the excess supply minus the excess demand. 
D)  a constant price and a quantity. 
A)  a price only. 
B)  a quantity only. 
C)  the excess supply minus the excess demand. 
D)  a constant price and a quantity.

Question 10

When two goods are substitutes,a shock that raises the price of one good causes the price of the other good to

Accepted Answer

A)  remain unchanged. 
B)  decrease. 
C)  increase. 
D)  change in an unpredictable manner. 
A)  remain unchanged. 
B)  decrease. 
C)  increase. 
D)  change in an unpredictable manner.

Question 11

-The above figure shows a graph of the market for pizzas in a large town.No pizzas will be supplied unless the price is above

Accepted Answer

A)  $0. 
B)  $5. 
C)  $12. 
D)  $14. 
A)  $0. 
B)  $5. 
C)  $12. 
D)  $14.

Question 12

A downward sloping demand curve indicates that

Accepted Answer

A)  individuals all have the same valuation of the same product. 
B)  individuals have different valuations of the same product. 
C)  individuals have no valuations of a particular product. 
D)  certain individuals are uninformed about certain aspects of the product. 
A)  individuals all have the same valuation of the same product. 
B)  individuals have different valuations of the same product. 
C)  individuals have no valuations of a particular product. 
D)  certain individuals are uninformed about certain aspects of the product.

Question 13

If the demand curve is horizontal and the supply curve is vertical,shifts of the supply curve will lead to

Accepted Answer

A)  changes in the equilibrium quantity only. 
B)  changes in the equilibrium price only. 
C)  changes in both the equilibrium price and quantity. 
D)  changes in the quantity demanded only. 
A)  changes in the equilibrium quantity only. 
B)  changes in the equilibrium price only. 
C)  changes in both the equilibrium price and quantity. 
D)  changes in the quantity demanded only.

Question 14

-The above figure shows the market for apples.If the government restricts output to no more than 300 pounds,then

Accepted Answer

A)  300 pounds of apples will be sold at $3. 
B)  200 pounds of apples will be sold at $3. 
C)  no apples will be sold. 
D)  None of the above. 
A)  300 pounds of apples will be sold at $3. 
B)  200 pounds of apples will be sold at $3. 
C)  no apples will be sold. 
D)  None of the above.

Question 15

-The above figure shows a graph of the market for pizzas in a large town.At a price of $5,there will be

Accepted Answer

A)  excess demand. 
B)  excess supply. 
C)  equilibrium. 
D)  zero demand. 
A)  excess demand. 
B)  excess supply. 
C)  equilibrium. 
D)  zero demand.

Question 16

Suppose the market for potatoes can be expressed as follows:
Supply: QS = -20 + 10p
Demand: QD = 400 - 20p
Solve for the equilibrium price and quantity.

Accepted Answer

Equate the RHS of the supply e

Question 17

Assume that the market for annual physical checkups is in equilibrium,and not everyone gets an annual physical checkup.What is the effect on price and quantity if a government regulation fixes price at the current level and requires everyone to get an annual physical checkup?

Accepted Answer

@#IMG-DLM& See the above figure.Requirin

Question 18

The term "inverse demand curve" refers to

Accepted Answer

A)  a demand curve that slopes upward. 
B)  expressing the demand curve in terms of price as a function of quantity. 
C)  the demand for "inverses." 
D)  the difference between quantity demanded and supplied at each price. 
A)  a demand curve that slopes upward. 
B)  expressing the demand curve in terms of price as a function of quantity. 
C)  the demand for "inverses." 
D)  the difference between quantity demanded and supplied at each price.

Question 19

If a large number of people decide to major in economics,the supply and demand model has little to say about the future wages of economists.

Accepted Answer

A) True 
 B)False

Question 20

Technological innovation in the production of computers has led to

Accepted Answer

A)  a decrease in the quantity demanded for computers. 
B)  a rightward shift of the supply curve for computers. 
C)  a decrease in the quantity supplied of computers. 
D)  None of the above. 
A)  a decrease in the quantity demanded for computers. 
B)  a rightward shift of the supply curve for computers. 
C)  a decrease in the quantity supplied of computers. 
D)  None of the above.

Consider the demand functions:A)Qd = 250 - 2P B)Qd = 300 - 3P. Which of the demand functions reflects a higher level of consumer incomes?

Suppose society wants to increase the number of teachers in society but doesn't want to pay teachers any more in salary and benefits.This could only occur by

The quantity of a good that consumers demand depends only on the price of the good.

Suppose the market for potatoes can be expressed as follows: Supply: Q^S = -20 + 10p Demand: Q^D = 400 - 20p If the government sets a maximum price of $10 per unit,what will be the quantity demanded and quantity supplied?

The fact that many people drive faster than the posted speed limit suggests that

Suppose the demand for a particular product can be expressed as Q = 100/p.Calculate the total amount spent on this good when p = 10,20,and 50.Can you make a generalization about the mathematical form of this demand curve and consumer behavior in this market?

Municipalities that have adopted the policy of "rent control" typically set the rentals on certain apartments well below equilibrium.As a result,

If the demand for high definition televisions increases and the supply of high definition televisions increases,then

A competitive equilibrium is described by

When two goods are substitutes,a shock that raises the price of one good causes the price of the other good to

-The above figure shows a graph of the market for pizzas in a large town.No pizzas will be supplied unless the price is above

A downward sloping demand curve indicates that

If the demand curve is horizontal and the supply curve is vertical,shifts of the supply curve will lead to

-The above figure shows the market for apples.If the government restricts output to no more than 300 pounds,then

-The above figure shows a graph of the market for pizzas in a large town.At a price of $5,there will be

Suppose the market for potatoes can be expressed as follows: Supply: Q^S = -20 + 10p Demand: Q^D = 400 - 20p Solve for the equilibrium price and quantity.

Assume that the market for annual physical checkups is in equilibrium,and not everyone gets an annual physical checkup.What is the effect on price and quantity if a government regulation fixes price at the current level and requires everyone to get an annual physical checkup?

The term "inverse demand curve" refers to

If a large number of people decide to major in economics,the supply and demand model has little to say about the future wages of economists.

Technological innovation in the production of computers has led to

Introduction

Applying the Supply-And-Demand Model

Consumer Choice

Applying Consumer Theory

Firms and Production

Costs

Competitive Firms and Markets

Applying the Competitive Model

General Equilibrium and Economic Welfare

Monopoly

Pricing and Advertising

Oligopoly and Monopolistic Competition

Game Theory

Factor Markets

Interest Rates, Investments, and Capital Markets

Uncertainty

Externalities, Open-Access, and Public Goods

Asymmetric Information

Contracts and Moral Hazards

Filters

Exam 2: Supply and Demand

Consider the demand functions:A)Qd = 250 - 2P B)Qd = 300 - 3P. Which of the demand functions reflects a higher level of consumer incomes?

Suppose society wants to increase the number of teachers in society but doesn't want to pay teachers any more in salary and benefits.This could only occur by

The quantity of a good that consumers demand depends only on the price of the good.

Suppose the market for potatoes can be expressed as follows: Supply: QS = -20 + 10p Demand: QD = 400 - 20p If the government sets a maximum price of $10 per unit,what will be the quantity demanded and quantity supplied?

The fact that many people drive faster than the posted speed limit suggests that

Suppose the demand for a particular product can be expressed as Q = 100/p.Calculate the total amount spent on this good when p = 10,20,and 50.Can you make a generalization about the mathematical form of this demand curve and consumer behavior in this market?

Municipalities that have adopted the policy of "rent control" typically set the rentals on certain apartments well below equilibrium.As a result,

If the demand for high definition televisions increases and the supply of high definition televisions increases,then

A competitive equilibrium is described by

When two goods are substitutes,a shock that raises the price of one good causes the price of the other good to

-The above figure shows a graph of the market for pizzas in a large town.No pizzas will be supplied unless the price is above

A downward sloping demand curve indicates that

If the demand curve is horizontal and the supply curve is vertical,shifts of the supply curve will lead to

-The above figure shows the market for apples.If the government restricts output to no more than 300 pounds,then

-The above figure shows a graph of the market for pizzas in a large town.At a price of $5,there will be

Suppose the market for potatoes can be expressed as follows: Supply: QS = -20 + 10p Demand: QD = 400 - 20p Solve for the equilibrium price and quantity.

Assume that the market for annual physical checkups is in equilibrium,and not everyone gets an annual physical checkup.What is the effect on price and quantity if a government regulation fixes price at the current level and requires everyone to get an annual physical checkup?

The term "inverse demand curve" refers to

If a large number of people decide to major in economics,the supply and demand model has little to say about the future wages of economists.

Technological innovation in the production of computers has led to

Introduction

Applying the Supply-And-Demand Model

Consumer Choice

Applying Consumer Theory

Firms and Production

Costs

Competitive Firms and Markets

Applying the Competitive Model

General Equilibrium and Economic Welfare

Monopoly

Pricing and Advertising

Oligopoly and Monopolistic Competition

Game Theory

Factor Markets

Interest Rates, Investments, and Capital Markets

Uncertainty

Externalities, Open-Access, and Public Goods

Asymmetric Information

Contracts and Moral Hazards

Filters

Suppose the market for potatoes can be expressed as follows: Supply: Q^S = -20 + 10p Demand: Q^D = 400 - 20p If the government sets a maximum price of $10 per unit,what will be the quantity demanded and quantity supplied?

Suppose the market for potatoes can be expressed as follows: Supply: Q^S = -20 + 10p Demand: Q^D = 400 - 20p Solve for the equilibrium price and quantity.