Microeconomics Spring 2019
Jamie is a sophomore in college and has a 2.75 cumulative grade point average (GPA). His cumulative GPA will be better next semester if he (i)performs better than he did last semester. (ii)performs better than his cumulative GPA. (iii)gives an average performance.
ii) only
oil spike
income effect
if the price of orange juice rises, the demand for grapefruit juice will
increase because the two goods are substitues
if the price of orange juice rises, the demand for apple juice will
increase because the two goods are substitutes
an increase in both equilibrium price and quantity could be produced by a(n)
increase in demand,with supply constant
an increase in quantity supplied can be caused by a(n)
increase in price
which of the following is most closely associated with normative economics
some economists believe that the government did right thing by bailing out the big Wallet Street banks in 2008
In the above figure, the point of elasticity occurs
somewhere between point c and d
If a student accidentally clicks on "_______" instead of clicking "________" then "________," she/he will lose the credits for the unfinished test.
submit, save, next page
goods a and b are
substitutes. 1.67
"as income rises, the demand for a product decreases." this statement
suggests that this good is inferior goods
Input of Labor # of workers Total Product # of outputs 1 20 2 66 3 116 4 176 5 206 6 226 In Table above, Diminish marginal product occurs after actually employing the
the 5th worker
if marginal utility is negative,
the consumer considers extra units of commodity to be a "bad"
an excess supply of rice in a competitive market would indicate that
the current price exceeds the equilibrium price
which is true
under perfect competition price equals marginal cost while monopoly price is greater than monopoly cost
which of the following would cause an economy to be producing at a point inside its production possibilities curve
unemployment and an inefficient use of available resources
which of the following would cause an economy to be producing at a point inside its production possibilities curve
unemployment and inefficient use of resources
If the cross-price elasticity of demand between two goods is negative, the the two goods
unrelated
In a competitive market, when price is below the equilibrium level, the price will be driven ______ due to
upward, excess demand
if the calculated elasticity between two points is 2.26, demand is considered
very elastic
if the calculated elasticity of demand between two points is 3.4, demand is considered,
very elastic
Johnny is a sophomore in college and has a 2.5 cumulative gpa, johnny's cumulative gpa will be better next semester if he
performs better than his cumulative gpa
price discrimination in the case of monopolist
physician services
Accounting profits are ___________ when the firm is at its short-run break-even point.
positive
accounting profits are the short-run break-even points are
positive
If goods X and Y are substitutes, then the cross elasticity of demand will be
positive.
sophomore in college 3.025, how can she get a worse cum gpa
preforms worse than her cum gpa
the law of supply says that
price and quantity supplied are directly related
if the government sets a maximum price that can be charged for a good or service, it thereby creates
price ceiling
When income is $100 per week, 20 units of good X are demanded. When income is $150 per week, 30 units of good X are demanded. The income elasticity of demand of good X equals to
1
a 50 percent rise of a price of a good leads to a 50 percent decrease in quantity demanded. the price elasticity of demand is
1.0
If an individual's income rises 40 percent and purchases of clothing rise 50 percent, the income elasticity for clothing by the individual is__-
1.25
if an individuals income rises 40 percent and purchases of clothing rise 60 percent, the
1.50
a price elasticity of 1.4 indicates that
10 percent decrease in price leads to a 14 percent increase in quantity demanded
If the price elasticity of demand is 2, a 5 percent decrease in price will increase quantity demanded by
10%
If the price elasticity of demand is -10, a 10 percent decrease in price will increase quantity demanded by
100 percent
In a perfectly competitive market, if P > ATC in the short run, there is apt to be
entry of new firms into the market.
Which of the following statements about a firm's short-run variable costs is TRUE
They typically include the labor cost.
Assume that 10 units of labor are needed to produce 4 units of output. If the price of labor is spent $6 per unit, and if fixed costs are $60, then what is the average variable cost of 4 units per output?
$15
profit-maximizing charged for goods is produced $10. intersection of marginal revenue
$30
Assume that 10 units of labor are needed to produce 4 units of output. If the price of labor is $6 per unit, and if fixed costs are $50, then what is TVC and AVC at 3 units of output?
$45, $15
Yao Ming graduates from college with a choice of playing professional football at $2 million a year or coaching for $50,000 a year. He decides to play football, but eight years later he quits football to be a TV star for $3 million a year. His opportunity cost at graduation was ______ and eight years later was ______.
$50,000; $2 million
Bill Bonecrusher graduates college with a choice of playing professional football at a $2 million dollar a year or coaching for $50,000 a year. He decides to play football but eight years later he quits to make a movie for $3,000,00 a year. His opportunity cost at graduating___
$50,000; 2 million
According to Table below, what is the price elasticity of demand (using Midpoint method) when price rises from $7 to $8?
) 1.5
When the price of chicken is $2.00/lb, the quantity demanded for hamburger is 50 units, when the price of chicken is $3.00lb, the quantity demanded of hamburger is 60 units. the cross price elasticity of demand between chicken and hamburger is
+5/11
When price is $5 per unit, quantity demanded is 12 units. When price is $6 per unit, quantity demanded is 8 units. The value of price elasticity of demand is approximately (before take absolute value)
-11/5
When price is $5 per unit, quantity demanded is 10 units. When price is $8 per unit, quantity demanded is 6 units. The value of the price elasticity of demand is approximately (before taking absolute value)
-13/12.
When price is $5 per unit, quantity demanded is 12 units. When price is $8 per unit, quantity demanded is 6 units. The value of the price elasticity of demand is approximately (before taking absolute value)
-13/9
The prices of the goods and the consumer's income are always assumed constant as we move along the budget line, if any one of them changes, the budget line will change as well
...
Trade off consumers are able t make between one good or another.
...
a consumers budget constraint identifies which combinations of goods and services the consumer can afford with a limited budget, at given prices
...
a decrease in the price of a good rotates the budget line upward
...
an increase in income shifts the budget line rightward, with no change in slope
...
an increase in income will shift the budget line upward and rightward, a decrease in income will shift the budget line downward and leftward. These shifts are parallel, changes in income do not affect the budget line's slope
...
budget line is the graphical representation of a budget constraint showing the maximum affordable quantity of one good for given amounts of another good
...
if the absolute value of the price elasticity of the demand of a product is greater than 1, then demand price is elastic
...
if the price of food rises, holding all other prices and money income constant for miss. bucana, she will adjust her expenditures and reach an equilibrium on a lower indifference curve
...
the consumers will always choose a point on the budget line rather than a point below it
...
when the price of a good changes, the budget line rotates. both its slope and one of its intercepts will change
...
while a decrease in the price of other good rotates it rightward
...
Table 1901A Bob's Marginal Utility for consuming beer and pizza with $8.00 in income. Q of Marginal Q of Marginal Pizza Utility Beer Utility 1 45 1 40 2 40 2 40 3 30 3 35 4 15 4 10 5 -5 5 0 According to Table 1901A, how much total utility does Bob get from 3 pieces of pizza?
115 units
According to Table, how much total utility does Bob get from 4 pieces of beer? Q of Marginal Q of Marginal Pizza Utility Beer Utility 1 45 1 40 2 40 2 40 3 30 3 35 4 15 4 10 5 -5 5 0
125 utils
a patent provides protection
17 years
According to Table on Q#1, what is the price elasticity of demand if price falls from $8.50 to $8.00 (while Quantity rises from 40 to 45)? (Use % change equation only)
17/8
when income is $100 per week, 20 units of good x are demanded. When income is $150 per week, 20.... demanded. The income elasticity of demand of good x equals to
1?????? price elasticity of demand equ midpoint
if the price elasticity of demand is 4, a 5 percent decrease in price will increase quantity .....
20%
MR quantity at 3
23
if the price of elasticity demand is -5, a 5 percent decrease in price will increase quantity demanded by
25 percent
price at quantity 2
32
average revenue at quantity 1
35
Suppose that the best investment you could make with $100,000 in cash is to purchase a government T bond that pays 4.85% a year. The opportunity cost for this investment is
4,850
a certain athlete loves donuts. he receives 100 units of utility for the first donut, an additional 80 for the second, an additional 60 for the third, another 40 for the fourth, and another 20 for the fifth. The marginal utility of the fourth donut is ____ and the total utility from consuming four donuts is _____
40; 280
when the price of beef is $2 per pound the quantity demanded of hamburger is... the price of beef is $3. The quantity demanded is 60 units... price elasticity of demand bewtween beef and burger is
5/11
if the monopolist wants to maximize his revenue, how many units of his product should it sell
6
What is price elasticity of demand when price rises from $8.50 - $9
7/3
new york knicks...5 million a year... 70,000...300,000
70,000 , 5 million
suppose that the best investment you could make with 100k is cash is to purchase tbond that pays x percent interest per year. if you decide to invest the money in your own business instead of buying the government tbond the opportunity cost of forgoing this financial investment is
7000 per year
TR at quantity 3
87
the profit maximizing price for the monopolist is
A
The statement that "Netflix's stock closed at $194" on 10/20/2017 is
A positive statement
If a dinner guest were serious when claiming that he just could not get enough of your homemade Kimchi (a Korean preserved appetizer) and that the more he ate the more he wanted, you would conclude that for him the marginal utility of Kimchi was
A) increasing.
curve represents long run average cost
ATC d
marginal revenue curve for a monopolist is
B
Despite the fact that water is necessary to sustain life, it is less expensive than soda pop. Economic theory suggests that this is so because
B) although the total utility of water consumption is high, its marginal utility is low when compared to soda pop.
marginal cost curve for a monopoly firm is
C
The marginal rate of substitution is measured along
C) a given indifference curve.
When the price of gold rises, there will be
C) a movement along the good's supply curve.
Total Utility Data Table Quantity per Week Michelle Robert David Lauren 0 0 0 0 0 1 5.0 1,000 60 60 2 9.9 1,900 120 130 3 14.7 2,700 180 220 4 19.4 3,400 240 310 5 24.0 4,000 300 425 6 28.5 4,500 360 575 7 32.9 4,900 420 900 8 37.2 5,200 480 1,275 9 41.4 5,400 540 1,770 According to Table 1903A, David's utility schedule is characterized by
C) constant marginal utility.
If the absolute value of the price elasticity of demand for for a product is greater than 1, then
C. Demand is price elastic
The fact that consumers will purchase more of a good that has become relatively cheaper
C. is called the price substitution effect
A line showing feasible combinations of two goods that a consumer could afford given his money income is the
D) budget constraint.
The price elasticity of demand is defined as
D. The responsiveness of quantity demanded to a change in price
if an individual consumes only two goods and consumption of one good increases, then in order to keep the consumer on the same indifference curve,consumption of the other good must
Decrease
An increase in a company's total revenue (TR) for a product will result if
Demand is inelastic and price increases
Which of the following statements is false?
Economies of scale only applies to short run.
maximum profits possible for a monopolist that charges one price to the customers all over the area
GQyt
if irene graduated from Channel Island State and found a $45,000 annual income job last year and she projected that her 2017 income will be $50,000. What's Irene's income growth rate from 2014 to 2017? (round up the answer if needed)
Increasing by 11%
firms in a competitive industry are producing goods efficiently in the long run if each is producing at the minimum
LRAC curve
Firms in a competitive industry are producing goods efficiently in the long run if each is producing at the minimum point of the
LRAC curve.
Which of the following is NOT true for a perfectly competitive firm in the long run?
MC > AC
not true for a competitive firm in the long run
MC>AC
In equilibrium, which of the following conditions is common to both pure monopoly and pure competition?
MR = MC
Unregulated monopoly and pure competition
MR=MC
If this firm produces output level Q2, it has average variable cost of
OE
In the above figure, the output level of Q1 total variable costs is
OF times Q1
At a competitive firm's short-run break-even price,
P=ATC
competitive firms short-run break-even price
P=ATC
Rational preferences
Preferences that satisfy two conditions 1. any two alternatives can be compared and one is preferred or else the two are valued equally 2. the comparisons are logically consisted or transitive
If Py is the price of the good on the vertical axis and Px is the price of the good on the horizontal axis then
Px/Py= the relative price of the good X, opportunity cost of one more unit of good X, the absolute value of the slope of the consumer's budget line
Equation for Budget Line
PxQx + PyQy =B
The long-run supply curve for a firm in a perfectly competitive market is
The competitive firm's long-run supply curve is the portion of its MC curve that lies above ATC
Some costs do not vary with the quantity of output produced. Those costs are called
Total Fixed Costs
Once an online test was launched by a student, it's a point of no-return. There isn't anything the instructor can alter technically. There will be no grade compensations in such regards (when you lose your connectivity, or experiencing a frozen PC, or other careless/subjective mistakes, such as hitting the "submit" w/o finishing the entire test, etc.).
True
of the following, which could cause the demand curve for at&t iphone to shift to the left
a cheaper 2-year service plan by verizon's iphone
Both Supply and Demand decrease will result in
a decrease in equilibrium quantity and an unknown in equilibrium price
all of the following except one would increase the amount of Ford-F150 that buyers would like to buy. which is the exception
a decrease in the price of steel
which of the following would shift the demand curve for regular vanilla ice cream, which is assumed to be a normal good, to the left?
a favorable change in tastes toward blueberry ice cream
the marginal rate of substitution is measured along
a given indifference curve
the statement that "google's stock closed at $712" on 1/22/2016 is
a positive statement
utility
a quantitative measure of pleasure or satisfaction obtained from consuming goods and services
Refer to Table 3-5. If England and Spain trade based on the principle of comparative advantage, England will export
a. bread and Spain will export cheese.
Microeconomics is the study of
a. individual decision-makers.
which line represents monopolist price
ab
in a competitive market that is characterized by free entry and exit
all firms will operate in efficient scale in the long run
Which of the following is assumed constant along the demand curve for gasoline?
all variables affecting demand other than the price of gasoline
despite the fact that water is necessary to sustain life, it is less expensive than soda pop, economic theory suggests that this is so because
although the total utility of water is consumption is high, its marginal utility is low when compared to soda pop
which of the following would be strictly microeconomic topic
an increase in the price of the Ford Focus GT
which of the following would shift the demand curve for new college textbooks to the right?
an increase in the price of used college textbooks
if the demand if a good is inversely related to income, it must be
an interior good
strawberries
helped
to maximize profits it will produce at output level
b where mc and avc clash
The fact that consumers will purchase more of a good that has become relatively cheaper
is called the price-substitution effect.
The Great Recession brought the income of buyers in US decline and it also brought reduction in resource(input) prices worldwide. What would we expect to occur on equilibrium price and quantity of a normal good in the US market?
b. the equilibrium price would decrease, but the impact on the equilibrium quantity in the market would be ambiguous.
If we are graphing total utility, then the total utility curve will
be increasing as long as marginal utility is positive
if we are graphing total utility, then the total utility curve will
be increasing as long as marginal utility is positive
a line showing feasible combinations of two goods that a consumer could afford given his money income is the
budget constraint
Labor hours needed to make one unit of Amount produced in 40 hours Cheese Bread Cheese Bread England 1 2 40 20 Spain 2 8 20 5 Refer to Table 3-5. England has an absolute advantage in
d. both goods and Spain has a comparative advantage in cheese.
If the calculated elasticity of demand between two points is 1.22, demand is considered
elastic.
If the incomes of Japanese buyers decline and somehow there is also a reduction in all resource (input) prices. What would we expect to occur on equilibrium price and quantity of an inferior good in the US market?
c. the equilibrium quantity would increase, but the impact on equilibrium price would be ambiguous
price taker
cannot influence the price
A price taker is someone who
cannot influence the price.
during the short run the firm cannot
change its plant size
Suppose the cross price elasticity demand between blue ray and dvd is -1.32 that indicated that these two products are
complements
Total Utility Data Table Quantity per Week Michelle Robert David Lauren 0 0 0 0 0 1 5.0 1,000 60 60 2 9.9 1,900 120 130 3 14.7 2,700 180 220 4 19.4 3,400 240 310 5 24.0 4,000 300 425 6 28.5 4,500 360 575 7 32.9 4,900 420 900 8 37.2 5,200 480 1,275 9 41.4 5,400 540 1,770 According to Table 1903A, David's utility schedule is characterized by
constant marginal utility
a monopolist
is constrained in its price decisions by the demand curve it faces
If an individual consumes only two goods and consumption of one good increases, then in order to keep his consumption level on the same indifference curve, his consumption for the other good must
decrease
if an individual consumes only two goods and consumption of one good increase then in order to keep the consumer on the same indifference curve, consumption of the other good must
decrease
if an individual consumes only two goods and consumption of one good increases, then in order to keep the consumer in the same indifference curve , consumption on the other good must__
decrease
if an individual consumes only two goods and consumption of one good increases, then in order to keep the consumer on the same indifference curve, consumption of the other good must
decrease
A decrease in the price of a commodity results in a(n)
decrease in quantity supplied
a decrease in the price of commodity results in a(n)
decrease in quantity supplied
Blue-ray DVD and its player are complementary goods. An increase in the price of Blue-ray DVDs results in a(n)
decrease in the demand for Blue-Ray DVD players
orange juice and cranberry juice are substitute goods. an increase in the price of orange juice will result in a(n)
decrease in the quantity demanded of cranberry juice
a perfectly competitive firm faces the following short-run cost and revenue conditions
decrease output
Suppose a perfectly competitive firm faces the following short-run cost and revenue conditions: ATC > AVC; MC > MR. The firm should
decrease output.
an increase in total revenue will result if
demand is inelastic and price increases
if the firm lowers its price of its product and as a result total revenue falls, we can conclude that
demand is inelastic in its price range
Which of the following is most closely associated with positive economics?
determining the impacts from government stimulus on the actual level of total employment
monopolist faces demand curve
downward sloping
the price elasticity of demand would be lowest for
drinking water
in a perfectly competitive market, if P>ATC in the short run, there is apt to be
entry of new firms into the market
if the price is equal to p4
earn positive profits
statement is false
economies of scale in short run concept
the longer the time frame involved, the more likely it is the demand be relatively
elastic
the longer time frame involved , the more likely it is that the demand will be relatively
elastic
demand curve of a perfectly competitive firm is
perfectly elastic
if the income of american buyers decline and somehow there is also a reduction in all resource (input) prices. what would we expect to occur on equilibrium price and quantity of an inferior good in the us market
equilibrium price decrease ??
an increase in demand along with a decrease in supply will result in
equilibrium price will rise and equilibrium quantity is undetermined
not an example of price discrimination
everyone pays the same price for a good
encouraging firms to invest in R/D and individuals to engage in creative endeavors such as new drug formula
exclusive rights assigned by government monopolies
marginal utility describes
extra utility for each additional good consumed
if the price elasticity of demand for good y is .75 when there is a 30 percent increase in price we can be sure that quantity demanded
fell by 22.5 percent
if the price elasticity of demand for good y is .75, when there is a 30 percent increase in price, we can be sure that quantity demanded
fell by 22.5 percent
In Table above, diminish marginal product occurs after actually hiring the
fifth
faces the following conditions: ATC>AVC; MC<MR
firm should increase output
cost doesnt vary with quantity of output produced
fixed costs
which of the following would be strictly a microeconomics topic
ford taurus
In Table above, diminish marginal product occurs after the
fourth
it is correct to state that a society which is on its production possibilities curve is
fully utilizing its productive resources
The opportunity cost of each additional computer in terms of televisions
increases as more computers are produced
as an individual consumes more of a particular commodity the total level of utility derived from that consumption usually
increases at a decreasing rate
as an individual consumes more of a particular commodity, the total level of utility derived from that consumption usually
increases at a decreasing rate
As an individual consumes more of a particular commodity, the total level of utility derived from that consumption usually
increases at a decreasing rate.
If a dinner guest is serious when claiming he just could not get enough of your homemade kimchi and that the more he ate the more he wanted, you would conclude that for him the marginal utility of kimchi was
increasing
If marginal utility is positive but decreasing, total utility is
increasing
if marginal utility is positive but decreasing, total utility is
increasing
if we are graphing total utility, then the total utility curve will be
increasing as long as marginal utility is postive
If the cost of producing each performance of a Raider's game is constant and the demand of tickets is inelastic, profits could be maximized by
increasing ticket prices
if the cost of producing each performance of a raiders game is constant and the demand for tickets is inelastic, profits could be maximized by
increasing ticket prices
If the cost of producing each performance of a Lake Game show is constant and the demand for tickets is inelastic, profits could be maximized by
increasing ticket prices.
the long run average cost curve
is a curve which is tangent to each number of a set of short-run average cost curves
at a price of $5.00 per doll, most stores cannot keep ferbi dolls in stock because consumers buy them all as soon as shipments arrive. this implies that there
is an excess demand for ferbi, and the price must rise for equilibrium to be reached
the fact that consumers will have spend more on gasoline during a world oil price spike and less on other goods and services they usually purchase for their daily life. this microeconomic phenomenon
is called price-substitution effect
the fact that consumers will purchase more of a good that has become relatively cheaper
is called price-substitution effect
The fact that consumers will purchase more of a good that has become relatively cheaper
is called the price substitution effect
the fact that consumers will purchase more of a good that has become relatively cheaper
is called the price substitution effect
The fact that consumers will have to spend more on gasoline during a world oil price spike and less on other goods and services they usually purchase for their daily life. This microeconomic phenomenon
is called the price- substitution effect
The fact that consumers will have to spend more on gasoline during a world oil price spike and less on other goods and services they usually purchase for their daily life. This microeconomic phenomenon
is called the price-substitution effect.
if a firm is price discriminating we know that
it has market power
At the short run break-even point, the competitive firm is
just covering its total variable costs.
single plant firm trying to select the appropriate sized plant for a particular rate of output will choose the size plant with the
lower fixed cost
If the price elasticity of demand for orange is greater than 1, an increase in orange prices will
lower total revenue
if the price elasticity of demand for orange is greater than 1, an increase in orange prices will
lower total revenue
short-run break-even point, the competitive firm is
making zero economic profits
in the short run, the additional output the results from hiring an additional unit of a variable input is the __
marginal (physical) product
In the short run, the additional output that results from hiring an additional unit of a variable input is the
marginal (physical) product.
The cost of producing an additional unit of output is the firm's
marginal cost
the cost of an additional output in the firm is
marginal cost
the cost of producing an additional unit of output is the firm's
marginal cost
short-run supply curve for a firm in a perfectly competitive market
marginal cost curve
long run supply curve
marginal cost curve above average total cost
short run supply curve for perfectly competitive market
marginal cost curve above average variable cost
in the short run, the additional output that results from hiring an additional unit of a variable input is the
marginal physical product
the change in total revenue divided by the change in quantity produced is the definition for
marginal revenue
which of the following statements about markets is false
markets are used to allocate resources in centrally-planned socialist economic systems
A basic tenet of the of the theory of the firm is that the firm's primary objective is to __
maximize profits
a basic tenet of the theory of the firm is that the firm's primary objective is to maximize
maximize profits
cumulative gpa
perform better than his cumulative gpa
short-run break-even output occurs at
minimum price of its ATC curve
profit maximizing behavior of a monopoly is different from a perfectly competitive firm
monopoly can control the desired price level of output to maximize profits but a perfect comp can only control desired output
the demand curve for petroleum shoul dbe
more elastic in the long run than in the short run
The demand curve for oil should be
more elastic in the long run than in the short run.
for a monopolist, marginal revenue is less than price
must lower price on all units sold
a single firm can supply a single product to an entire market
natural monopoly
If goods X and Y are complements, then the cross elasticity of the demand will be
negative
if goods x and y are complements then the cross elasticity of demand will be
negative
the implicit cost incurred by a firm to use its resources to produce its output is the firm's
opportunity cost
the productions possibility curve bows outward because
opportunity costs are increasing as a production of a good increases
A diseconomy of scale indicates that a firm is producing its ______ at a ______ ATC.
output, higher
a goods price elasticity of demand can be calculated by using the formula
percentage change in quantity demanded divided by percentage change in price
A good's price elasticity of demand can be calculated by using the formula
percentage change in quantity demanded divided by percentage change in price.
The fact that consumers will have to spend more on gasoline during a world oil price spike and less on other goods and services they usually purchase for their daily life. This microeconomic phenomenon
price substitution
under a market system of resource allocation
prices determine both what firms produce and what consumers buy
suppose MR. Joe"Big's" ratios of marginal utility of beer to the price of beer and the...pizza are equal. If the price of beer increases, he will
probably consume less beer and more pizza
suppose mr joe's "Big"'s ratios of marginal utility of beer to the price of beer and the marginal utility of pizza to the price of pizza is equal. if the price of beer increases, he will
probably consume less beer and more pizza
patent on a product gives firm
protection from having invention copied
wheat
quantity at which market price is equal to the farm's marginal cost of production
According to the above figure, a shortage will occur where
quantity demanded exceeds quantity supplied
lemonade
raise price to increase total revenue
if the price of food rises holding all other prices and money income constant for miss bucanna she will adjust her expenditures and
reach an equilibrium on a lower indifference curve
if the price of food rises holding all other prices and money income constant for mr smith she will adjust her expenditures and
reach an equilibrium on a lower indifference curve
if the price of food rises holding all other prices and money income constant for mr. zhang he will adjust his expenditures and
reach an equilibrium on a lower indifference curve
if the price of food rises, holding all other prices and money constant for Mrs. Wang, she will have to adjust her expenditures
reach an equilibrium on a lower indifference curve
If the price of food rises, holding all other prices and money income constant for Mrs. Wang, she will have to adjust her expenditures and
reach an equilibrium on a lower indifference curve.
if the price of food rises, holding all other prices and money income constant for Mr. Wang, he will adjust his expenditures and
reach an equilibrium on a lower indifference curve.
when the marginal cost curve is above the average cost curve, the average cost curve is__
rising
when the marginal cost curve is above the average cost curve, the average cost curve...
rising
price discrimination
selling a given product at more than one price when the price is unrelated to cost differences
price ceilings set below the equilibrium price cause
shortages
A firm is currently producing at the rate of output that just barely covers its variable costs. If demand falls, the firm should
shut down
a firm is currently producing at the rate of output that just covers variable costs. if demands falls
shut down
if price is equal to p1
shut down
for a competitive firm, any output price below its AVC is
shut down price
For a competitive firm, any output price below its minimum AVC is its
shut-down price.
a movement along the production possibilities curve would imply that
society has chosen a different set of outputs
a movement along the productions possibility curve would imply that
society has chosen a different set of outputs
A movement along the production possibilities curve would imply that
society has chosen a different set of outputs.
the great recession brought the incomes of buyers in the US decline and it also brought reduction in resource worldwide . what would we expect to occur in equilibrium price and quantity of a normal good in the US market?
the equilibrium price would decrease but the impact on the equilibrium quantity in the market would be ambiguous
the great recession brought the income of buyers in US decline and it also brought reduction in resource (input) prices worldwide. what would we expect to occur on equilibrium price and quantity of a normal goof in the US market?
the equilibrium price would decrease, but the impact on the equilibrium quantity in the market would be ambiguous
the great recession brought the incomes of buyers in us decline and it also brought reduction is resource prices worldwide. what would we expect to occur on equilibrium price and quantity of a normal good in the us market
the equilibrium price would decrease, but the impact on the equilibrium quantity in the market would be ambiguous
If the incomes of American buyers decline and somehow there is also a reduction in all resource (input) prices. What would we expect to occur on equilibrium price and quantity of an inferior good in the US market?
the equilibrium quantity would increase, but the impact on equilibrium price would be ambiguous
If the incomes of American buyers decline and somehow there is also a reduction in all resource (input) prices. What would we expect to occur on equilibrium price and quantity of an inferior good in the US market?
the equilibrium quantity would increase, but the impact on equilibrium price would be ambiguous
A shift of the production possibilities curve outward could imply that
the labor productivity has grown.
Thirst Thelma owns and operates a small lemonade stand. When Thelma is producing a small quantity of lemonade she has few workers and her equipment is not fully being utilized. Because she can easily put her idle resources to use
the marginal cost of one more glass of lemonade is small
regretting a last unit of consumption of a good (a cake) implies that
the marginal utility of the last unit consumed was negative
when an entrepreneur invests his own financial capital in order to start a business
the opp cost of capital should be included in the economic cost of doing business
When an entrepreneur invests his own financial capital in order to start a business,
the opportunity cost of capital should be included in the economic cost of doing business.
when a business man invests his own financial capital to start a business
the opportunity cost of capital should be included in the economic cost of doing the business
the minimum possible short run average costs are equal to long run average costs when
the plant is producing at its short run minimum point
the minimum possible short run avg costs are equal to long run avg costs when
the plant is producing at its short run minimum point
The minimum possible short-run average costs are equal to long-run average costs when
the plant is producing at its short-run minimum point.
a perfect competitor marginal revenue equals
the price
If we divide one money price by another money price, we get what is called a relative price
the price of one good relative to the other
For a perfectly competitive market, marginal revenue equals
the price.
The Great Wall Farm sells wheat to a grain broker in outskirts of Beijing, China. Since the market for wheat is generally considered to be competitive, the Farm maximizes its profit by choosing
the quantity at which market price is equal to the farm's marginal cost and marginal revenue of production.
monopolist maximize profits by
the rate of output where marginal revenue equals marginal cost
price elasticity of demand measures
the responsiveness of quantity demanded to a change in price
since the producers must be compensated for the rising opportunity cost that accompanies increase in output,
the supply curve usually slopes upward
in economics, utility is defined as
the want-satisfying power of a good or service
when regulating a natural monopoly, one of the problems with setting price equal to average cost is
there is no incentive to lower cost, consumer surplus is not maximized, total surplus is not optimized
Some costs do not vary with the quantity of output produced. Those costs are called
total fixed cost
Some costs do not vary with the quantity of output produced. Those costs are called
total fixed costs
some costs do not vary
total fixed costs
economic profit is equal to
total revenue minus explicit and implicit costs
Accounting profit is equal to
total revenue minus explicit costs.
Total Utility Data Table Quantity per Week Michelle Robert David Lauren 0 0 0 0 0 1 5.0 1,000 60 60 2 9.9 1,900 120 130 3 14.7 2,700 180 220 4 19.4 3,400 240 310 5 24.0 4,000 300 425 6 28.5 4,500 360 575 7 32.9 4,900 420 900 8 37.2 5,200 480 1,275 9 41.4 5,400 540 1,770 According to Table 1903A, Robert's utility schedule is characterized by
total utility that increases at a decreasing rate
deadweight loss due to monopoly pricing
triangle bge
the opportunity cost of any action is
what is sacrificed to purse that action
at which of the following circumstance will average variable cost equal average total cost
when average fix cost approach zero
At what productive circumstance, a firm's AVC will converge with (approach to) average total course curve (ATC)
when average fixed cost approach zero
At what productive circumstance, a frim's AVC will converge with (approach to) average total course curve (ATC)
when average fixed cost approach zero
A single-plant firm trying to select the appropriate-sized plant for a particular rate of output will choose the size plant
whose short-run average total cost curve is lowest at that rate of output.
A single-plant firm trying to select the appropriate-sized plant for a particular rate of output will choose the size plant
whose short-run average total cost curve is lowest at that rate of output.
opec
world wide oil embargo. elastic
