Econ Midterm 2
Jack says to you " Manufactures can sell all they want that price." Jack thinks demand for the product is...
perfectly elastic.
Demand is said to be inelastic if...
quantity demanded moves proportionately less than price.
What is the effect of the refinery closure on the market for oil used to produce gasoline?
the equilibrium price decreases and the equilibrium quantity decreases.
A freak electric accident close several gasoline refineries for an extended period. What is the effect in the gasoline market?
the equilibrium price increases, the equilibrium quantity decreases.
If an exceptionally snowy winter makes for great skiing conditions but also raises the cost of shipping-in skies, we would expect...
the equilibrium price to rise, but the effect on quantity to be uncertain,
The elasticity of demand for a price cut from 10 to 9 is...
2.5
Which of the following would increase the quantity of tennis rackets demanded at the equilibrium price?
A popular US player wins Wimbledon, The price of tennis balls fall, The price of catgut used to make racket strings falls.
"When demand increases, the price rises. At higher prices, the law of demand says that consumers buy fewer units. Thus, demand increases may cause quantity demanded to fall." What is wrong with this statement?
A shift in demand differs from a movement along a demand curve.
The figure above represents the market for ground beef, which is initially in equilibrium at point J. Assume that ground beef is an inferior good. Which of the following can explain a movement to a new equilibrium point M?
a decrease in buyers' incomes combined with an increase in the price of cattle feed.
Which of the following would lead to an increase in both the equilibrium price and quantity of an inferior good, such as macaroni and cheese?
a decrease in income
Which of the following will increase the quantity of photocopiers supplied at the market price?
a fall in the price of photocopy paper ( a complement), a rise in the price of scanners (a substitute), new technology that makes it possible to manufacture much more cheaply
The figure above represents the market for ground beef, which is initially in equilibrium at point J. Assume that ground beef is an inferior good. Which of the following can explain a movement to a new equilibrium at point L?
a rise in the population combined with an increased price for ground pork.
If a crime wave inspires the purchase window bars at the same time criminals torch several window bar factories, we would expect ...
the equilibrium price to rise, but the effect on quantity to be uncertain.
If a craze for coconut water develops after Jennifer Lawrence reveals she drinks it every day,...
the quantity of coconut water supplied will increase.
A lot more paintings are sold when the price of art falls, Therefore...
there are many substitutes for paintings.
Which of the following will not increase the demand for apple cider?
An exceptionally abundant apple crop.
The demand curves shows ______ and the supply curve shows ________.
all of the above.
The price of peanut butter rises sharply. What happens to the equilibrium price and quantity of jelly (a complement)?
both price and quantity fall.
Which of the following would be supply-based explanation for the fall in US consumption of pork?
Pig feed prices have skyrocketed, new regulations require additional investment in processing pigs waste, many municipalities are banning pig farms.
How would a price cut from 10 to 9 affect suppliers' revenues (price times quantity)?
revenues would increase
Which of the following if MBN's principle explanation for why fracking has produced more natural gas in the US than in Europe?
In the US, land owners possess rights t minerals under the surface; Europe the central government does.
Which of the following would be modeled most accurately by the graph above?
Supply of seats on an airplane flight that will take off in 2o minutes.
What would happen in the market for goat cheese if the price of goat feed increased while the price of sheep cheese (a substitute) decreases?
The equilibrium quantity would decrease, but the impact on price would be uncertain.
The reason demand curves negative slopes is
decreasing marginal benefits.
What happens in the market for ink when the price for the lead used to make pencils rises?
demand increases
If a pic rises 9% lead to a rise in quantity supplied 12%, we know that supply is...
elastic.
Suppose that the price of train tickets ( a substitute for driving) rises an the price of oil falls. What would you expect to happen to the price and quantity of gasoline?
equilibrium quantity would increase, but the impact on equilibrium price would be uncertain.
The figure above represents the market for ground beef, which is initially in equilibrium at point J. Assume that ground ground beef in an inferior good. Which of the following can explain a movement to a new equilibrium at point K?
expensive new regulatory requirements combined with an increase in shipping fees.
Fred watches few football games now that he has an infant son. This is because...
his opportunity cost of watching football has increased.
Which of the following will increase the supple of photocopiers?
new technology that makes it possible to manufacture photocopiers much more cheaply.
According to MBN, water is a good
none of the above.
Wilma is a devoted coffee drinker while Berry drinks coffee and tea interchangeably. Wilma's demand for coffee will be_______, while Betty's demand will be ______.
relatively more elastic, relatively more elastic.