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Microeconomics

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10 views2 pages

Microeconomics

Uploaded by

mamdouhbevnoty
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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1) Suppose the quantity demanded is 5 units when the price is $1.00. If the price rises to $2.

00, the quantity demanded falls to 3


units. The price elasticity of demand is

A) 2.00 B) 0.5. C) 0.75 D) 1.33.

An Increase in Supply A Decrease in Supply


An Increase in Demand (1) (2)
A Decrease in Demand (3) (4)
2) According to the table, the space that would represent a decrease in equilibrium quantity and unchanged in equilibrium price
would be

A. (1) B. (2) C. (3) D. (4)

4) According to the table, the space that would represent a decrease in equilibrium price and unchanged in equilibrium quantity
would be

A. (1) B. (2) C. (3) D. (4)

5) According to the table, the space that would represent an increase in equilibrium price and unchanged in equilibrium quantity would be

A. (1) B. (2) C. (3) D. (4)

3) According to the table, the space that would represent an increase in equilibrium quantity and unchanged in equilibrium price
would be

A. (1) B. (2) C. (3) D. (4)

1. Normative Statement - A statement about what actually is (was or will be), as opposed to what ought to be. An expression that
can be verified by observation. ( F )

2. Law of Demand - The tendency of suppliers to offer more of a good at a higher price. (F)

3. Inferior Good - A good that increases in demand when consumer income rises. (F )

8. A complementary good, in contrast to a substitute good, is a good with a negative cross elasticity of demand. This means a
good's demand is increased when the price of another good is decreased. (F )

9. The accounting cost is what is given up in order to get something else. (F)

12. Changes in determinants of supply lead to movements along the supply curve. ( F )
6) Which of the diagrams shows what happens in the market for oranges when a severe late frost in Florida damages orchards statewide?

A. Figure I B. Figure II C. Figure III D. Figure IV

7) Which of the diagrams shows what happens in the market for cotton when the prices of alternative synthetic fabrics rise?

A. Figure I B. Figure II C. Figure III D. Figure IV.

11) Which of the diagrams shows rise of income (case: normal goods).

A. Figure I B. Figure II C. Figure III D. Figure IV.

8) Which of the diagrams shows what happens in the market for milk when improvements in cattle feed result in higher milk yields
from dairy cows?

A. Figure I B. Figure II C. Figure III D. Figure IV

9) Airplane travelers take frequent taxi trips to and from airports. Which of the diagrams shows what happens in the market for
trips by taxi when travelers are faced with rising airline prices?

A. Figure I B. Figure II C. Figure III D. Figure IV.

12) Which of the diagrams shows rise of income (case: inferior goods).

A. Figure I B. Figure II C. Figure III D. Figure IV.

10) According to the law of supply, a price increase will cause

A. an increase in the equilibrium quantity B. a decrease in the equilibrium quantity.

C. an increase in the quantity supplied, provided other factors have remained unchanged.

D. a decrease in the quantity supplied, provided other factors have remained unchanged.

4. Economic Efficiency- The use of resources so as to maximize the production of goods and services.( T )

5. Opportunity Cost - The cost of an opportunity forgone (and the loss of the benefits that could be received from that
opportunity). ( T )

6. Complement Good - Goods that, "go together." Such as, cookie dough and chocolate chips. (T )

7. Cross-Price Elasticity of Demand - Measures the responsiveness of the demand for a good to a change in the price of another
good. ( T )

10. If quantity demanded an income change in opposite directions, (elasticity income) will be negative, and the good is an inferior
good. ( T )

11. At prices below the equilibrium price, a shortage forces the price up. (t )

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