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Question;In economics, the term demand refers to the quantity of a good that peopleA) would like to consume on a given date.B) are willing and able to buy at a particular price on a given date.C) are willing and able to buy at all possible prices.D) would like to have available during a given time period.E) none of the above2.In economics, the term supply refers toA) the quantity of a good or service a producer must sell to earn a profit.B) the quantity of a product that people want to buy.C) the quantity of an item offered for sale at a particular price.D) the quantity of a good or service producers will sell at all possible prices.E) none of the above3.When buyers will purchase exactly as much as sellers are willing to sell, what is the condition that has been reached?A) supply and demandB) excess demandC) equilibrium priceD) price floorE) none of the above4.When there is an increase in supply, what is the probable result in the market?A) equilibrium would settle at a higher price and a lower quantityB) equilibrium would settle at a lower price and a higher quantityC) equilibrium would settle at a lower price and a lower quantityD) equilibrium would not changeE) none of the above5.In a market economy, who is it that ultimately determines the demand for a product or service?A) the producers who create the product or serviceB) the governmentC) those who buy the product or serviceD) those who supply the raw materials used in the production of the good or serviceE) all of the above6.When there is a decrease in demand, what happens in the market?A) equilibrium would settle at a higher price and a higher quantityB) equilibrium would settle at a lower price and a higher quantityC) equilibrium would settle at a higher price and a lower quantityD) equilibrium would settle at a lower price and a lower quantityE) none of the above7.What happens to a market when producers set their prices above the equilibrium price?A) quantity supplied will exceed quantity demanded, so there will be a surplusB) quantity demanded will exceed quantity supplied, so there will be a shortageC) excess supply means that price will continue to riseD) competition among sellers will cause prices to fallE) A and D8.A change in any of the following can cause a change in demand EXCEPTA) incomeB) tastes and preferencesC) the price of substitute goodsD) increases in production technologyE) the availability of a complimentary good9.A change in any of the following can cause a change in supply EXCEPTA) taxesB) price of inputsC) price of the productD) number of suppliersE) productivity10.Which of these is the most likely effect of an increase in the cost of production?A) a decrease in supplyB) a decrease in demandC) an increase in demandD) an increase in supplyE) all of the above11.Demand for a product tends to be inelastic when the productA) has few, if any, substitutes.B) is expensive.C) is a luxury item.D) has many substitutes.E) all of the above12.Demand for milk tends to be inelastic because milk is consideredA) a necessity.B) a substitute.C) good on Cap'n Crunch.D) a luxury.E) all of the above13.The price elasticity of demand measures how responsiveA) buyers are to a change in incomeB) sellers are to a change in priceC) buyers are to a change in priceD) sellers are to a change in production costs.E) none of the above14.Demand is said to be elastic ifA) the price of the good responds substantially to changes in quantity demand.B) the quantity demanded responds substantially to changes in the price of the good.C) the price of the good responds only slightly to changes in quantity demand.D) the quantity demanded responds only slightly to changes in the price of the good.E) none of the above15.When the price of bubble gum is $0.50, the quantity demanded is 400 packs per day. When the price falls to $0.40, the quantity demanded increases to 600. Given this information and using the total revenue method, you know that the demand for bubble gum isA) inelastic.B) elastic.C) unit elastic.D) perfectly inelastic.E) none of the above16.Figure 1 (Questions 16-19)Combined Supply and Demand SchedulePrice of aslice of pizza Quantitydemanded Quantitysupplied$.50 300 100$1.00 250 150$1.50 200 200$2.00 150 250$2.50 100 300$3.00 50 350In Figure 1, when the price of a slice of pizza is $2.50, how many slices are sold?A) 250B) 200C) 150D) 100E) 5017.In Figure 1, what is the equilibrium price?A) $3.00B) $2.00C) $1.50D) $1.00E) not enough information18.In Figure 1, when the price of a slice of pizza is $.50, which choice explains what is occuring the market?A) quantity demanded equals 200B) there is a shortage of pizzaC) the market is in equilibriumD) there is a surplus of pizzaE) not enough information19.In Figure 1, when the price of a slice of pizza is $2.50, what happens to the market?A) there is a shortage of pizzaB) there is a price floor on pizzaC) the quantity demanded equals 250D) there is a surplus of pizzaE) not enough information20.Use Figure 2 for Questions 20-22Refer to Figure 2. At a price of $15,A) there would be a shortage of 400 units.B) there would be a surplus of 400 units.C) there would be a shortage of 200 units.D) the market would be in equilibrium.E) none of the above21.Refer to Figure 2. At the equilibrium price,A) 200 units would be supplied and demanded.B) 400 units would be supplied and demanded.C) 600 units would be supplied and demanded.D) 600 units would be supplied, but only 200 would be demanded.E) none of the above22.Refer to Figure 2. At a price of $35,A) there would be a shortage of 400 units.B) there would be a surplus of 200 units.C) there would be a surplus of 400 units.D) the market would be in equilibrium.E) none of the above23.Figure 3 (Questions 23-29)Refer to Figure 3. Graph A shows which of the following?A) an increase in demandB) an increase in supplyC) an increase in quantity suppliedD) all of the above are correctE) both A and C are correct.24.Refer to Figure 3. Which of the four graphs represents the market for XBOX 360?s when the price of Playstation 3?s goes down?A) AB) BC) CD) D25.Refer to Figure 3. Which of the four graphs represents the market for pizzas delivered in a college town when students return to campus in September?A) AB) BC) CD) D26.Refer to Figure 3. Which of the four graphs represents the market for peanut butter after a major hurricane hits the peanut-growing south?A) AB) BC) CD) D27.Refer to Figure 3. Which of the four graphs represents the market for automobiles after steel becomes cheaper? A. AA) A.B) BC) CD) D28.Refer to Figure 3. Which of the four graphs represents the market for cars after a new restrictive government regulation is introduced?A) AB) BC) CD) D29.Refer to Figure 3. Which of the four graphs shows the market for gasoline immediately before a holiday weekend when people plan to travel?A) AB) BC) CD) D30.A technological advancementA) will shift the demand curve to the right.B) will shift the demand curve to the left.C) will shift the supply curve to the right.D) will shift the supply curve to the left.31.A new health kick has swept the nation making everyone want to exercise and be healthy. How does this affect the market for Pilates Workout DVDs?A) increase equilibrium quantity, increase equilibrium price.B) decrease equilibrium quantity, decrease equilibrium price.C) increase equilibrium quantity, decrease equilibrium price.D) decrease equilibrium quantity, increase equilibrium price.32.Coca-Cola has gone on sale. You can buy a case for only a dollar. What happens to the market for Pepsi?A) increase equilibrium quantity, increase equilibrium price.B) decrease equilibrium quantity, decrease equilibrium price.C) increase equilibrium quantity, decrease equilibrium price.D) decrease equilibrium quantity, increase equilibrium price.33.OPEC dramatically reduces the availability of crude oil. How does this affect the market for gasoline?A) increase equilibrium quantity, increase equilibrium price.B) decrease equilibrium quantity, decrease equilibrium price.C) increase equilibrium quantity, decrease equilibrium price.D) decrease equilibrium quantity, increase equilibrium price.34.The government decides to subsidize agriculture (support it with money). How does this affect the market for corn?A) increase equilibrium quantity, increase equilibrium price.B) decrease equilibrium quantity, decrease equilibrium price.C) increase equilibrium quantity, decrease equilibrium price.D) decrease equilibrium quantity, increase equilibrium price.35.A person who lives to be on the sea in a boat would tend to have what type of demand for boats?A) elasticB) inelasticC) unit elasticD) weak36.Demand for a good would tend to be more elastic,A) the greater the availability of complements.B) the longer the period of time considered.C) the broader the definition of the market.D) the fewer substitutes there are.37.Chocolate Chip ice cream would tend to have very elastic demand becauseA) other flavors of ice cream are almost perfect substitutes.B) the market is broadly defined.C) there are few substitutes.D) it must be eaten quickly.38.Holding all other forces constant, when the price of gasoline rises, the number of gallons of gasoline demanded would fall substantially over a ten year period becauseA) buyers tend to be much less sensitive to a change in price when given more time to react.B) buyers will have substantially more income over a ten year period.C) buyers tend to be much more sensitive to a change in price when given more time to react.D) None of these answers are correct.39.Demand is unit elastic ifA) elasticity is less than 1.B) elasticity is equal to 1.C) elasticity is greater than 1.D) elasticity is equal to 0.40.If hot dogs are an inferior good, an increase in income will result inA) An increase in the quantity demanded for hot dogs.B) An increase in the demand for hot dogs.C) A decrease in the quantity demanded for hot dogs.D) A decrease in the demand for hot dogs.E) No change in the quantity demanded for hot dogs.41.Which of the following statements best reflects the law of diminishing marginal utility?A) ?I have to have a scoop of ice cream on my pie.?B) ?I?ll never get tired of your cooking.?C) ?The last bite tastes just as good as the first.?D) ?I couldn?t eat another doughnut if you paid me.?E) ?I prefer to eat several small meals a day, rather than three large ones.?42.Brooke is spending all of her income consuming products X and Y. If MUX / PX = 10 and MUy / Py = 6, what should Brooke do to maximize her satisfaction?A) Buy more X and more Y.B) Buy more X and less Y.C) Buy less X and less Y.D) Buy less X and more Y.E) Make no changes43.While eating at Alex's "Pizza by the Slice" restaurant, Kara experiences diminishing marginal utility. She gained 10 units of satisfaction from her first slice of pizza consumed, and would only receive 5 units of satisfaction from consuming a second slice. Based on this information we can conclude that:A) Alex may have to lower the price to convince Kara to buy a second sliceB) Kara will not eat a second slice, even if it is given to her at no charge.C) Kara will definitely want to buy a second slice of pizza.D) even if Kara buys a second slice, she will not buy a third slice.

 

Paper#57904 | Written in 18-Jul-2015

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