Jess
February 3rd, 2013, 01:32 PM
CHECK BY TOMORROW, 10 am EST.
finished~
1. Rapidly increasing health costs have been a major political concern since at least 1992. Suppose the government sets the maximum price for a normal doctor's visit at $20 to control rising health costs but the current market price is $40. What will happen?
A. More people will be able to see the doctor, since the price is lower.
B. The same number of people will try to visit the doctor, and the same number of doctors are willing to see patients at that price.
C. Fewer people will try to see the doctor, and fewer doctors are willing to see patients at that price.
D. More people will try to visit the doctor, but there will be fewer doctors willing to see patients at that price.
2. 5174
Look at the figure Price Control. In the graph, one effective price ceiling would be the price indicated at point________ and a ________ would exist equal to the difference between points ________.
A. d; surplus; e and h
B. b; shortage; f and e
C. b; surplus; f and e
D. d; shortage; i and h
3. 5175
Look at the figure Supply and Demand. In the market shown in the figure, a price ceiling of P1 causes:
A. no change to the market.
B. a surplus equal to the distance AB.
C. a shortage equal to the distance DE.
D. a shortage equal to the distance AB.
4. 5175
Look at the figure Supply and Demand. In the market shown in the figure, a price ceiling of P3 causes a deadweight loss represented by:
A. area P1ADP2.
B. area DCE.
C. area P1ACP2.
D. area ACD
5. A price ceiling is likely to result in:
A. a persistent surplus, a transfer of surplus from producers to consumers, and deadweight loss.
B. a persistent shortage, a transfer of surplus from consumers to producers, and no deadweight loss.
C. a persistent surplus, a transfer of surplus from consumers to producers, and deadweight loss.
D. a persistent shortage, a transfer of surplus from producers to consumers, and deadweight loss.
6. The market for apples is in equilibrium at a price of $0.50 per pound. If the government imposes a price floor in the market at a price of $0.40 per pound, then:
A. the price floor will not affect the market price or output.
B. quantity supplied will increase.
C. there will be a shortage of the good.
D. quantity demanded will decrease.
7. All else equal, if a price floor that is above the equilibrium price is imposed on a market and the government buys the surplus, what will happen to consumer and producer surplus?
A. Consumer surplus will rise and producer surplus will fall.
B. Consumer surplus will fall and producer surplus will fall.
C. Consumer surplus will fall and producer surplus will rise.
D. Consumer surplus will rise and producer surplus will rise.
8. Which of the following is an example of a price floor?
A. a rent-controlled apartment
B. a government decree that capped the price of bottled water in the aftermath of a devastating hurricane
C. a maximum legal price that could be charged for gasoline during a time of war
D. the minimum wage
9. A price floor is likely to cause deadweight loss because:
A. a black market emerges and sellers sell the good at prices above the price floor.
B. the quantity of the good being bought and sold is less than the equilibrium quantity.
C. some buyers who want to buy at the controlled price are unable to find a seller willing to sell at that price.
D. buyers incur additional search costs looking for the scarce good.
10. 5176
Look at the figure The Market for Round-Trip Airline Flights. The supply and demand graph represents the market for round-trip airline flights between Boston and New York. Suppose the mayor of New York decides to limit the number of flights to Q1 to reduce air pollution. What area or areas represent deadweight loss after the quota is in place?
A. b + d + f
B. a
C. a + b + c
D. c + e
11. When the price goes down, the quantity demanded goes up. This price elasticity measures how:
A. much the equilibrium price goes up.
B. responsive the price change is in relation to an income change.
C. much the price goes down.
D. responsive the quantity change is in relation to the price change.
12. The price of gasoline rises 5% and the quantity of gasoline purchased falls 1%. The price elasticity of demand is equal to ________ and demand is described as ________.
A. 5; elastic
B. 0.2; elastic
C. 5; inelastic
D. 0.2; inelastic
13. Each month Jessica buys exactly 15 Big Macs regardless of the price. Jessica's price elasticity of demand for Big Macs is:
A. greater than 1.
B. 0.
C. 1.
D. less than 1 but greater than 0.
14. You manage a popular nightclub and lately revenues have been disappointing. Your bouncer suggests that raising drink prices will increase revenues, but your bartender suggests that decreasing drink prices will increase revenues. You aren't sure who is right, but you do know that:
A. your bouncer thinks the demand for drinks is elastic, while your bartender thinks the demand for drinks is inelastic.
B. both the bouncer and bartender think the demand for drinks is inelastic.
C. your bouncer thinks the demand for drinks is inelastic, while your bartender thinks the demand for drinks is elastic.
D. both the bouncer and bartender think the demand for drinks is elastic.
15. The university president believes that increasing student tuition by 5% will increase revenues. If the president is correct that revenues will increase, then the tuition increase will:
A. reduce the number of students enrolling by less than 5%.
B. reduce the number of students enrolling by more than 5%.
C. increase the number of students enrolling by 5%.
D. reduce the number of students enrolling by exactly 5%.
16. 5177
Look at the figure The Demand for Notebook Computers. The change in total revenue resulting from a change in price from P to T suggests that demand is:
A. inelastic.
B. price unit-elastic.
C. price-inelastic.
D. price-elastic.
17. If a good is a necessity with few substitutes, then demand will tend to:
A. have price elasticity equal to 1.
B. be the same as that of a luxury good.
C. be more price-elastic.
D. be less price-elastic.
18. Nico rents 10% more DVDs when his income increases by 20%. Based on this information, we know that:
A. DVDs have many substitutes.
B. the price of DVDs has decreased.
C. DVDs are an inferior good.
D. DVDs are a normal good.
19. 5178
Look at the figure Supply Curves. Which graph shows a perfectly inelastic supply curve?
A. C
B. D
C. A
D. B
20. It is very difficult for Julia to find inexpensive and available inputs for her business. Because of this, we predict that Julia's price elasticity of supply is:
A. unit-elastic.
B. elastic.
C. inelastic.
D. perfectly elastic.
Finished! Please check now.
finished~
1. Rapidly increasing health costs have been a major political concern since at least 1992. Suppose the government sets the maximum price for a normal doctor's visit at $20 to control rising health costs but the current market price is $40. What will happen?
A. More people will be able to see the doctor, since the price is lower.
B. The same number of people will try to visit the doctor, and the same number of doctors are willing to see patients at that price.
C. Fewer people will try to see the doctor, and fewer doctors are willing to see patients at that price.
D. More people will try to visit the doctor, but there will be fewer doctors willing to see patients at that price.
2. 5174
Look at the figure Price Control. In the graph, one effective price ceiling would be the price indicated at point________ and a ________ would exist equal to the difference between points ________.
A. d; surplus; e and h
B. b; shortage; f and e
C. b; surplus; f and e
D. d; shortage; i and h
3. 5175
Look at the figure Supply and Demand. In the market shown in the figure, a price ceiling of P1 causes:
A. no change to the market.
B. a surplus equal to the distance AB.
C. a shortage equal to the distance DE.
D. a shortage equal to the distance AB.
4. 5175
Look at the figure Supply and Demand. In the market shown in the figure, a price ceiling of P3 causes a deadweight loss represented by:
A. area P1ADP2.
B. area DCE.
C. area P1ACP2.
D. area ACD
5. A price ceiling is likely to result in:
A. a persistent surplus, a transfer of surplus from producers to consumers, and deadweight loss.
B. a persistent shortage, a transfer of surplus from consumers to producers, and no deadweight loss.
C. a persistent surplus, a transfer of surplus from consumers to producers, and deadweight loss.
D. a persistent shortage, a transfer of surplus from producers to consumers, and deadweight loss.
6. The market for apples is in equilibrium at a price of $0.50 per pound. If the government imposes a price floor in the market at a price of $0.40 per pound, then:
A. the price floor will not affect the market price or output.
B. quantity supplied will increase.
C. there will be a shortage of the good.
D. quantity demanded will decrease.
7. All else equal, if a price floor that is above the equilibrium price is imposed on a market and the government buys the surplus, what will happen to consumer and producer surplus?
A. Consumer surplus will rise and producer surplus will fall.
B. Consumer surplus will fall and producer surplus will fall.
C. Consumer surplus will fall and producer surplus will rise.
D. Consumer surplus will rise and producer surplus will rise.
8. Which of the following is an example of a price floor?
A. a rent-controlled apartment
B. a government decree that capped the price of bottled water in the aftermath of a devastating hurricane
C. a maximum legal price that could be charged for gasoline during a time of war
D. the minimum wage
9. A price floor is likely to cause deadweight loss because:
A. a black market emerges and sellers sell the good at prices above the price floor.
B. the quantity of the good being bought and sold is less than the equilibrium quantity.
C. some buyers who want to buy at the controlled price are unable to find a seller willing to sell at that price.
D. buyers incur additional search costs looking for the scarce good.
10. 5176
Look at the figure The Market for Round-Trip Airline Flights. The supply and demand graph represents the market for round-trip airline flights between Boston and New York. Suppose the mayor of New York decides to limit the number of flights to Q1 to reduce air pollution. What area or areas represent deadweight loss after the quota is in place?
A. b + d + f
B. a
C. a + b + c
D. c + e
11. When the price goes down, the quantity demanded goes up. This price elasticity measures how:
A. much the equilibrium price goes up.
B. responsive the price change is in relation to an income change.
C. much the price goes down.
D. responsive the quantity change is in relation to the price change.
12. The price of gasoline rises 5% and the quantity of gasoline purchased falls 1%. The price elasticity of demand is equal to ________ and demand is described as ________.
A. 5; elastic
B. 0.2; elastic
C. 5; inelastic
D. 0.2; inelastic
13. Each month Jessica buys exactly 15 Big Macs regardless of the price. Jessica's price elasticity of demand for Big Macs is:
A. greater than 1.
B. 0.
C. 1.
D. less than 1 but greater than 0.
14. You manage a popular nightclub and lately revenues have been disappointing. Your bouncer suggests that raising drink prices will increase revenues, but your bartender suggests that decreasing drink prices will increase revenues. You aren't sure who is right, but you do know that:
A. your bouncer thinks the demand for drinks is elastic, while your bartender thinks the demand for drinks is inelastic.
B. both the bouncer and bartender think the demand for drinks is inelastic.
C. your bouncer thinks the demand for drinks is inelastic, while your bartender thinks the demand for drinks is elastic.
D. both the bouncer and bartender think the demand for drinks is elastic.
15. The university president believes that increasing student tuition by 5% will increase revenues. If the president is correct that revenues will increase, then the tuition increase will:
A. reduce the number of students enrolling by less than 5%.
B. reduce the number of students enrolling by more than 5%.
C. increase the number of students enrolling by 5%.
D. reduce the number of students enrolling by exactly 5%.
16. 5177
Look at the figure The Demand for Notebook Computers. The change in total revenue resulting from a change in price from P to T suggests that demand is:
A. inelastic.
B. price unit-elastic.
C. price-inelastic.
D. price-elastic.
17. If a good is a necessity with few substitutes, then demand will tend to:
A. have price elasticity equal to 1.
B. be the same as that of a luxury good.
C. be more price-elastic.
D. be less price-elastic.
18. Nico rents 10% more DVDs when his income increases by 20%. Based on this information, we know that:
A. DVDs have many substitutes.
B. the price of DVDs has decreased.
C. DVDs are an inferior good.
D. DVDs are a normal good.
19. 5178
Look at the figure Supply Curves. Which graph shows a perfectly inelastic supply curve?
A. C
B. D
C. A
D. B
20. It is very difficult for Julia to find inexpensive and available inputs for her business. Because of this, we predict that Julia's price elasticity of supply is:
A. unit-elastic.
B. elastic.
C. inelastic.
D. perfectly elastic.
Finished! Please check now.