FIN321 Chapter 2 Quiz
Which of the following will cause a change in quantity supplied?
A change in the market price of the good.
Which of the following would lead to an INCREASE in the demand for golf balls?
An increase in average household income when golf balls are a normal good.
Which of the following would decrease the supply of wheat?
An increase in the price of corn.
Use the following general linear demand relation to answer the next question: Qd = 100 - 5P + 0.004M - 5PR, where P is the price of good X, M is income and PR is the price of a related good, R. If M = $40,000 and PR = $20 and the supply function is Qs = 85 + 10P, market price and output are, respectively,
P = $5 and Q = 135.
Use the following demand and supply functions to answer the next question: Demand: Qd = 600 - 30P Supply: Qs = -300 + 120P Equilibrium price and output are
P = $6 and Q = 420.
Use the following general linear supply function to answer the next question: Qs = 60 + 8P - 4PI + 20F, where Qs is the quantity supplied of the good, P is the price of the good, PI is the price of an input, and F is the number of firms producing the good. When PI = $20 and F = 60, the INVERSE supply function is
P = -147.5 + 0.125Qs.
Use the following general linear demand relation to answer the next question: Qd = 100 - 5P + 0.004M - 5PR, where P is the price of good X, M is income and PR is the price of a related good, R. What is the demand function when M = $40,000 and PR = $20?
Qd = 160 - 5P
Use the following general linear demand relation to answer the next question: Qd = 100 - 5P + 0.004M - 5PR, where P is the price of good X, M is income and PR is the price of a related good, R. From the demand function it is apparent that related good R is
a compliment for good X
Use the following general linear demand relation to answer the next question: Qd = 100 - 5P + 0.004M - 5PR, where P is the price of good X, M is income and PR is the price of a related good, R. From the demand function it is apparent that good X is
a normal good
Refer to the graph below: A ceiling price of $15 would cause...
a shortage of 800
Refer to the graph below: A floor price of $30 would cause...
a surplus of 400
If the price of a complement increases, all else equal,
demand will decrease.
Consumer surplus...
is never negative
If input prices increase, all else equal,
supply will decrease
