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devry ECON-312 week 2 quiz

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Question;(TCO 2) A demand curve;Student Answer: shows the;relationship between price and quantity supplied.;indicates the quantity demanded at each price;in a series of prices.;graphs as an upsloping line.;shows the relationship between income and;spending.;Instructor Explanation: Chapter 3.;Points Received: 1 of 1;Comments;Question 2. Question;(TCO 2) In the past few years, the demand for donuts has;greatly increased. This increase in demand might best be explained by;Student Answer: an increase in;the cost of making donuts.;an increase in the price of coffee.;consumers expecting donut prices to fall.;a change in buyer tastes.;Instructor Explanation: Chapter 3.;Points Received: 1 of 1;Comments;Question 3. Question;(TCO 2) College students living off campus frequently;consume large amounts of ramen noodles and boxed macaroni and cheese. When they;finish school and start their careers, their consumption of both goods;frequently declines. This suggests that ramen noodles and boxed macaroni and;cheese are;Student Answer;inferior goods.;normal goods.;complementary goods.;substitute goods.;Instructor Explanation: Chapter 3.;Points Received: 1 of 1;Comments;Question 4. Question;(TCO 2) Which of the following would mostly likely increase;the demand for gasoline?;Student Answer;The expectation by consumers that gasoline prices will be higher in the future;The expectation by consumers that gasoline;prices will be lower in the future;A widespread shift in car ownership from SUVs;to hybrid sedans;A decrease in the price of public;transportation;Instructor Explanation: Chapter 3.;Points Received: 1 of 1;Comments;Question 5. Question;(TCO 2) Increasing marginal cost of production explains;Student Answer: the law of;demand.;the income effect.;why the supply curve is upsloping.;why the demand curve is downsloping.;Instructor Explanation: Chapter 3.;Points Received: 1 of 1;Comments;Question 6. Question;(TCO 2) If the demand for product X is inelastic, a 4%;increase in the price of X will;Student Answer: decrease the;quantity of X demanded by more than 4%.;decrease the quantity of X demanded by less;than 4%.;increase the quantity of X demanded by more;than 4%.;increase the quantity of X demanded by less;than 4%.;Instructor Explanation: Chapter 4.;Points Received: 1 of 1;Comments;Question 7. Question;(TCO 2) Suppose the price of local cable TV service;increased from $16.20 to $19.80, and as a result, the number of cable;subscribers decreased from 224,000 to 176,000.;Use the Midpoint formula to find the answer. Along this portion of the;demand curve, price elasticity of demand is;Student Answer: 0.8;1.2;1.6;8.0;Instructor Explanation: Chapter 4.;Points Received: 1 of 1;Comments;Question 8. Question;(TCO 2) A firm can sell as much as it wants at a constant;price. Demand is thus;Student Answer: perfectly;inelastic.;perfectly elastic.;relatively inelastic.;relatively elastic.;Instructor Explanation: Chapter 4.;Points Received: 1 of 1;Comments;Question 9. Question;(TCO 2) If the University Chamber Music Society decides to;raise ticket prices to provide more funds to finance concerts, the Society is;assuming that the demand for tickets is;Student Answer: parallel to the;horizontal axis.;shifting to the left.;inelastic.;elastic.;Instructor Explanation: Chapter 4.;Points Received: 1 of 1;Comments;Question 10. Question;(TCO 2) The demand for a necessity whose cost is a small;portion of one's total income is;Student Answer: perfectly price;inelastic.;perfectly price elastic.;relatively price inelastic.;relatively price elastic.;Instructor Explanation: Chapter 4.;Points Received: 1 of 1;Comments;Question 11. Question;(TCO 2) What is the CETERIS PARIBUS assumption, and why is;this assumption very important in the definition of Demand or Supply?;Question 12. Question;(TCO 2) Suppose the price of widgets falls from $7 to $5 and;consumption of widgets rises from 15 widgets a month to 25 widgets. Calculate;your price elasticity of demand of widgets. What can you say about your price;elasticity of demand of widgets? Is it Elastic, Inelastic, or Unitary Elastic?;Why? Use the Midpoint formula and please show your work.

 

Paper#57958 | Written in 18-Jul-2015

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