micro

Refer to the diagram and assume that price increases from $2 to $10. The coefficient of the price elasticity of supply (midpoint formula) relating to this price change is about: see graph on sep page

.25 and supply is inelastic

The supply of product X is inelastic (but not perfectly inelastic) if the price of X rises by

7 percent and quantity supplied rises by 5 percent

A supply curve that is parallel to the horizontal axis suggests that:

A change in demand will change the equilibrium quantity but not price

A supply curve that is a vertical straight line indicates that:

A change in price will have no effect on the quantity supplied

Because of unseasonably cold weather, the supply of oranges has substantially decreased. This statement indicates that:

Amount of oranges that will be available at various prices has declined

If a firm's demand for labor is elastic, a union-negotiated wage increase will:

Cause the firms total payroll to decline

If the demand for farm products is price inelastic, a good harvest will cause farm revenues to:

Decrease

The price elasticity of demand for beef is about .60. Other things equal, this means that a 20 percent increase in the price of beef will cause the quantity of beef demanded to:

Decrease by approximately 12 percent

If the demand for product X is inelastic, a 4 percent increase in the price of X will:

Decrease the quantity of X demanded by less than 4 percent

Suppose Aiyanna's Pizzeria currently faces a linear demand curve and is charging a very high price per pizza and doing very little business. Aiyanna now decides to lower pizza prices by 5 percent per week for an indefinite period of time. We can expect that each successive week:

Demand will become less price elastic

If the supply of product X is perfectly elastic, an increase in the demand for it will increase:

Equilibrium quantity, but equilibrium price will be unchanged

Which type of goods is most adversely affected by recessions?

Goods for which the income elasticity coefficient is relatively high and positive

Price elasticity of demand

Greater in the long run than in the short run

The larger the positive cross elasticity coefficient of demand between products X and Y, the:

Greater their substitutability

"In the gasoline market, demand often exceeds supply and supply sometimes exceeds demand." "The price of gasoline rises and falls in response to changes in supply and demand" In which of these two statements are the terms demand and supply being used correctly?

In the second statement

If the demand for bacon is relatively elastic, a 10 percent decline in the price of bacon will:

Increase the amount demanded by more than 10 percent

If the price will elasticity of demand for a product is 2.5 then a price cut from $2.00 to $1.80 will:

Increase the quantity demanded by about 25 percent

If the demand and supply curves for labor are stable, a gov mandated increase in the wage( price of labor) will:

Increase the quantity supplied of labor and decrease the quantity demanded for labor

If the income elasticity of demand for lard is -3.00, this means that:

Lard is an inferior good

Supply curves tend to be:

More elastic in the long run because there is time for firms to enter or leave the industry

A firm can sell as much as it wants at a constant price. Demand is thus:

Perfectly elastic

Suppose that a 10 percent increase in the price of normal good Y causes a 20 percent increase in the quantity demanded of normal good X. The coefficient of cross elasticity of demand is:

Positive and therefore these goods are substitutes

A market equilibrium:

Provides productive Allocative efficiency and clears the market

D1 is more elastic than D2

Refer to the diagram. Between prices of 5.70 and 6.30

Other things the same, if a price change causes total revenue to change in the opposite direction, demand is:

Relatively elastic

Gigantic State University raises tuition for the purpose of increasing its revenue so that more faculty can be hired. GSU is assuming that the demand for education at GSU is:

Relatively inelastic

Assume a drought in the Great plains reduces the supply of wheat. Nothing that wheat is a basic ingredient in the production of bread and potatoes are a consumer substitute for bread, we would expect the price of wheat to:

Rise, the supply of bread to decrease, and demand for potatoes to increase

Engineers in Ford improve the efficiency of assembly lines used in the production of Ford Escape. This improvement will:

Shift the supply curve of Escape to the right

In order to provide better financial support for the state highway system, RI state leg plans to raise the excise tax on gasoline, we should expect the supply curve of gas:

Shifts to the left

Mississippi is one of the home states for farming catfish in the US a severe flooding damages plenty of catfish farms we can expect the supply curve of catfish in Mississippi

Shifts to the left

South Africa as a major producer of coffee beans is experiencing a drought. Weather forecast states that the drought situation is getting worse in the next 3 moths, we can expect the demand curve for coffee beans today

Shifts to the right

Other things equal, if the price of the display screen used to produce iphone falls, the:

Supply cure of iphone will shift to the right

Suppose that the price of peanuts falls from $3 to $2 per bushel and that, as a result, the total revenue received by peanut farmers changes from $16 to $14 billion. Thus:

The demand for peanuts is inelastic

Which of the following would most likely increase the demand for gasoline today?

The expectation by consumers that gasoline prices will be higher in the future

In which of the following statements are the terms "demand" and " quantity demand" used correctly?

The price of ice cream rose, the quantity demanded of ice cream fell, and the demand for ice cream toppings fell

In (point) moving along a demand curve, which of the following is NOT held constant?

The price of the product for which the demand curve is relevant

The Illinois central railroad once asked the Illinois commerce commission for permission to increase its commuter rates by 20 percent. The railroad argued that declining revenues made this rate increase essential. Opponents of the rate increase contended that the railroads revenues would fall because of the rate hike. it can be concluded that

The railroad felt that the demand for passenger service was inelastic and opponents of the rate increase felt it was elastic

It takes a considerable amount of time to increase the production of pork. This implies that:

The short run supply curve for pork is less elastic than the long run supply curve

The price of old baseball cards rises rapidly with increases in demand because:

The supply of old baseball cards is price inelastic

Which of the following goods will least likely suffer a decline in demand during a recession?

Toothpaste

Increasing marginal cost of production explains:

Why the supply curve is upsloping.

Suppose the supply of product X is perfectly inelastic. If there is an increase in the demand for this product, equilibrium price:

Will increase, but equilibrium quantity will be unchanged

Suppose the income elasticity of demand for toys is +2.00. This means that:

a 10 percent increase in income will increase the purchase of toys by 20 percent

A market is in equilibrium:

if the amount producers want to sell is equal to the amount consumers want to buy.

Suppose that the price of product X rises by 20 percent and the quantity supplied of X increases by 15 percent. The coefficient of price elasticity of supply for good X is:

less than 1 and therefore supply is inelastic

The demand for a necessity whose cost is a small portion of one's total income is:

relatively price inelastic

Compared to coffee, we would expect the cross elasticity of demand for:

tea to be positive, but negative for cream