Question 1

A rise in the oil price will

Accepted Answer

A) shift the supply curve of gas to the left. 
B) shift the supply curve of gas to the right. 
C) leave the supply curve of gas unchanged. 
D) Not enough information is provided. 
A) shift the supply curve of gas to the left. 
B) shift the supply curve of gas to the right. 
C) leave the supply curve of gas unchanged. 
D) Not enough information is provided.

Question 2

If a good has an income elasticity of demand greater than one,one might classify that good as

Accepted Answer

A) a necessity. 
B) a luxury. 
C) unusual. 
D) inelastic. 
A) a necessity. 
B) a luxury. 
C) unusual. 
D) inelastic.

Question 3

The change in price that results from a leftward shift of the supply curve will be greater if

Accepted Answer

A) the demand curve is relatively steep than if the demand curve is relatively flat. 
B) the demand curve is relatively flat than if the demand curve is relatively steep. 
C) the demand curve is horizontal than if the demand curve is vertical. 
D) the demand curve is horizontal than if the demand curve is downward sloping. 
A) the demand curve is relatively steep than if the demand curve is relatively flat. 
B) the demand curve is relatively flat than if the demand curve is relatively steep. 
C) the demand curve is horizontal than if the demand curve is vertical. 
D) the demand curve is horizontal than if the demand curve is downward sloping.

Question 4

Supply curves

Accepted Answer

A) slope upward. 
B) slope downward. 
C) are horizontal. 
D) can have many shapes. 
A) slope upward. 
B) slope downward. 
C) are horizontal. 
D) can have many shapes.

Question 5

Suppose the demand curve for a good shifts rightward,causing the equilibrium price to increase.This increase in the price of the good results in

Accepted Answer

A) a rightward shift of the supply curve. 
B) an increase in quantity supplied. 
C) a leftward shift of the supply curve. 
D) a downward movement along the supply curve. 
A) a rightward shift of the supply curve. 
B) an increase in quantity supplied. 
C) a leftward shift of the supply curve. 
D) a downward movement along the supply curve.

Question 6

If the supply curve for orange juice is estimated to be Q = 40 + 2p,then

Accepted Answer

A) supply is price elastic at all prices. 
B) supply is price inelastic at all prices. 
C) supply is elastic only at prices below 20. 
D) No general statements about price elasticity of supply can be made. 
A) supply is price elastic at all prices. 
B) supply is price inelastic at all prices. 
C) supply is elastic only at prices below 20. 
D) No general statements about price elasticity of supply can be made.

Question 7

Explain why the shape of the demand curve will determine the how a shock to the market equilibrium affect price and quantity.

Accepted Answer

A flatter demand curve has a smaller slo

Question 8

If a linear supply curve has a zero intercept,the elasticity of supply is always unitary.

Accepted Answer

A) True 
 B)False

Question 9

Which good would you expect to have a greater price elasticity: a gallon of gasoline sold at a specific gasoline station on Main Street in Phoenix,a gallon of gasoline sold in Phoenix,or a gallon of gasoline sold in Arizona? Why?

Accepted Answer

A gallon of gasoline sold at a

Question 10

Consider the following products.Which of them has the flattest demand curve?

Accepted Answer

A) insulin 
B) alcohol 
C) cigarettes 
D) butter 
A) insulin 
B) alcohol 
C) cigarettes 
D) butter

Question 11

According to the Law of Demand,the demand curve for a good will

Accepted Answer

A) shift leftward when the price of the good increases. 
B) shift rightward when the price of the good increases. 
C) slope downward. 
D) slope upward. 
A) shift leftward when the price of the good increases. 
B) shift rightward when the price of the good increases. 
C) slope downward. 
D) slope upward.

Question 12

Show that the slope of the market demand curve is the summation of the slopes of individuals' demand curves.

Accepted Answer

The market demand is given by Q = D¹(p)+

Question 13

Only in the case of perfectly inelastic demand will consumers pay the full amount of a specific tax or ad valorem tax.

Accepted Answer

A) True 
 B)False

Question 14

A drought in the Midwest will raise the price of wheat because of a

Accepted Answer

A) leftward shift in the supply curve. 
B) rightward shift in the supply curve. 
C) leftward shift in the demand curve. 
D) rightward shift in the demand curve. 
A) leftward shift in the supply curve. 
B) rightward shift in the supply curve. 
C) leftward shift in the demand curve. 
D) rightward shift in the demand curve.

Question 15

-The above figure shows a graph of the market for pizzas in a large town.If the price price rises from 7 to 8,what is the change in quantity demanded for pizzas?

Accepted Answer

A) -10 
B) -30 
C) -20 
D) 20 
A) -10 
B) -30 
C) -20 
D) 20

Question 16

When import restrictions are placed on a good,and as a result the price of the good increases,the demand curve for that good will

Accepted Answer

A) shift rightward. 
B) shift leftward. 
C) become steeper. 
D) be unaffected. 
A) shift rightward. 
B) shift leftward. 
C) become steeper. 
D) be unaffected.

Question 17

The supply curve for tickets for a sporting event

Accepted Answer

A) is perfectly inelastic. 
B) is vertical. 
C) has a price elasticity of zero. 
D) All of the above. 
A) is perfectly inelastic. 
B) is vertical. 
C) has a price elasticity of zero. 
D) All of the above.

Question 18

Suppose the demand for Digital Video Recorders (DVRs)is given by Q = 250 - .25p + 4pc,where Q is the quantity of DVRs demanded (in 1000s),p is the price of a DVR,and pc is the price of cable television.How much does the quantity demanded for DVRs change if the p rises by $40?

Accepted Answer

A) drops by 10,000 DVRs 
B) increases by 16,000 DVRs 
C) drops by 2,500 DVRs 
D) increases by 4,000 DVRs 
A) drops by 10,000 DVRs 
B) increases by 16,000 DVRs 
C) drops by 2,500 DVRs 
D) increases by 4,000 DVRs

Question 19

Suppose the log-linear demand for widgets is found to be
Ln(Q)= 1.5 - 2ln(p)
According to this equation,a 10% increase in price will decrease Q by what percentage? What is the price elasticity of demand?

Accepted Answer

The answer of Suppose the log-linear demand for widgets is...

Question 20

The demand for pizzas in a large town is written as: Qd = 120 - 10P + 5Pb - 0.5Ps - 10Y,where Qd is the quantity demanded,P is the price,Pb is the price of burritos,Ps is the price of soft drinks sold in the pizza restaurants,and Y is personal income per month (in thousand dollars).What is ∆Q/∆Ps?

Accepted Answer

A) 5 
B) -5 
C) 0.5 
D) -0.5 
A) 5 
B) -5 
C) 0.5 
D) -0.5

A rise in the oil price will

If a good has an income elasticity of demand greater than one,one might classify that good as

The change in price that results from a leftward shift of the supply curve will be greater if

Supply curves

Suppose the demand curve for a good shifts rightward,causing the equilibrium price to increase.This increase in the price of the good results in

If the supply curve for orange juice is estimated to be Q = 40 + 2p,then

Explain why the shape of the demand curve will determine the how a shock to the market equilibrium affect price and quantity.

If a linear supply curve has a zero intercept,the elasticity of supply is always unitary.

Which good would you expect to have a greater price elasticity: a gallon of gasoline sold at a specific gasoline station on Main Street in Phoenix,a gallon of gasoline sold in Phoenix,or a gallon of gasoline sold in Arizona? Why?

Consider the following products.Which of them has the flattest demand curve?

According to the Law of Demand,the demand curve for a good will

Show that the slope of the market demand curve is the summation of the slopes of individuals' demand curves.

Only in the case of perfectly inelastic demand will consumers pay the full amount of a specific tax or ad valorem tax.

A drought in the Midwest will raise the price of wheat because of a

-The above figure shows a graph of the market for pizzas in a large town.If the price price rises from 7 to 8,what is the change in quantity demanded for pizzas?

When import restrictions are placed on a good,and as a result the price of the good increases,the demand curve for that good will

The supply curve for tickets for a sporting event

Suppose the demand for Digital Video Recorders (DVRs)is given by Q = 250 - .25p + 4p_c,where Q is the quantity of DVRs demanded (in 1000s),p is the price of a DVR,and p_c is the price of cable television.How much does the quantity demanded for DVRs change if the p rises by $40?

Suppose the log-linear demand for widgets is found to be Ln(Q)= 1.5 - 2ln(p) According to this equation,a 10% increase in price will decrease Q by what percentage? What is the price elasticity of demand?

Introduction

A Consumers Constrained Choice

Demand

Consumer Welfare and Policy Analysis

Firms and Production

Costs

Competitive Firms and Markets

Properties and Applications of the Competitive Model

General Equilibrium and Economic Welfare

Monopoly and Monopsony

Pricing and Advertising

Game Theory

Oligopoly and Monopolistic Competition

Factor Markets

Uncertainty

Property Rights, Externalities, Rivalry, and Exclusion

Asymmetric Information

Contracts and Moral Hazards

Filters

Exam 2: Supply and Demand

A rise in the oil price will

If a good has an income elasticity of demand greater than one,one might classify that good as

The change in price that results from a leftward shift of the supply curve will be greater if

Supply curves

Suppose the demand curve for a good shifts rightward,causing the equilibrium price to increase.This increase in the price of the good results in

If the supply curve for orange juice is estimated to be Q = 40 + 2p,then

Explain why the shape of the demand curve will determine the how a shock to the market equilibrium affect price and quantity.

If a linear supply curve has a zero intercept,the elasticity of supply is always unitary.

Which good would you expect to have a greater price elasticity: a gallon of gasoline sold at a specific gasoline station on Main Street in Phoenix,a gallon of gasoline sold in Phoenix,or a gallon of gasoline sold in Arizona? Why?

Consider the following products.Which of them has the flattest demand curve?

According to the Law of Demand,the demand curve for a good will

Show that the slope of the market demand curve is the summation of the slopes of individuals' demand curves.

Only in the case of perfectly inelastic demand will consumers pay the full amount of a specific tax or ad valorem tax.

A drought in the Midwest will raise the price of wheat because of a

-The above figure shows a graph of the market for pizzas in a large town.If the price price rises from 7 to 8,what is the change in quantity demanded for pizzas?

When import restrictions are placed on a good,and as a result the price of the good increases,the demand curve for that good will

The supply curve for tickets for a sporting event

Suppose the demand for Digital Video Recorders (DVRs)is given by Q = 250 - .25p + 4pc,where Q is the quantity of DVRs demanded (in 1000s),p is the price of a DVR,and pc is the price of cable television.How much does the quantity demanded for DVRs change if the p rises by $40?

Suppose the log-linear demand for widgets is found to be Ln(Q)= 1.5 - 2ln(p) According to this equation,a 10% increase in price will decrease Q by what percentage? What is the price elasticity of demand?

Introduction

A Consumers Constrained Choice

Demand

Consumer Welfare and Policy Analysis

Firms and Production

Costs

Competitive Firms and Markets

Properties and Applications of the Competitive Model

General Equilibrium and Economic Welfare

Monopoly and Monopsony

Pricing and Advertising

Game Theory

Oligopoly and Monopolistic Competition

Factor Markets

Uncertainty

Property Rights, Externalities, Rivalry, and Exclusion

Asymmetric Information

Contracts and Moral Hazards

Filters

Suppose the demand for Digital Video Recorders (DVRs)is given by Q = 250 - .25p + 4p_c,where Q is the quantity of DVRs demanded (in 1000s),p is the price of a DVR,and p_c is the price of cable television.How much does the quantity demanded for DVRs change if the p rises by $40?