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# examiic - Principles of Microeconomics Exam II Version C...

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Principles of Microeconomics – Exam II – Version C Name: _________________________ University of Texas-Arlington Multiple Choice : Select the best answer (2 points each) 1. In the market for mechanical pencils, the equilibrium point has moved down and to the right. What effect does this change have on market equilibrium? c. price decreases while quantity increase 2. The number of persons who want to work at the minimum wage is ________. c. N2 3. Price floors a. cause surpluses when they are effective. _____ b. are effective when they are above the equilibrium price. c. cause fewer exchanges to be made. 4. Suppose the government imposes a price ceiling on a good below its equilibrium price. Which of the following is NOT a likely result? c. Everyone will be content with the ceiling price as it stands.

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5. The market for good X is initially in equilibrium at \$5.00. The government then places a per- unit tax on good X, as shown by the shift of S 1 to S2. As a result, d. consumers end up paying \$6.25 per unit, producers end up receiving \$6.25 per unit but only keeping \$4.00 per unit. 6. Which of the following is true? a. The price elasticity of demand for COKE-COLA is higher than the price elasticity of demand for soft drinks in general. 7. If a small increase in the price of a good reduces quantity demanded to zero, demand is _____ b. perfectly elastic. 8. When quantity demanded increases c. total revenue increases if demand is elastic. 9. If a 7% increase in the price of a commodity results in a 12% increase in the quantity supplied, supply is said to be _____ b. elastic. 10. Which of the following could not cause an increase in the supply of cotton? a. an increase in the price of cotton 11. The price elasticity of demand tends to be higher for goods a. for which the consumer spends a high percentage of his or her income. 12. The longer the time period consumers have to adjust to price changes, the ________ is the ________ elasticity of demand.
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