mic_mock_final

Mic_mock_final - Name Date Use the following to answer question 1 1 In figure 3.8 what would be the result if a price ceiling is set which is $2

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Name: __________________________ Date: _____________ Use the following to answer question 1: 1. In figure 3.8, what would be the result if a price ceiling is set which is $2 different from the equilibrium price and demand increased by 30? A) The price would be above equilibrium and a surplus of 90 would be produced. B) The price would be below equilibrium and a shortage of 90 would be produced. C) The price would be above equilibrium and a shortage of 90 would be produced. D) The price would be below equilibrium and a surplus of 90 would be produced. Page 1
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Use the following to answer question 2: 2. In figure 3.6, what could cause the movement from point D to point A? A) A decrease in the demand. B) An increase in the price. C) An increase in prices of resources. D) An increase in the price of a substitute product. 3. What can we conclude if consumers are forced to wait in long line-ups in order to purchase products such as food and fuel? A) That the price of these items is at equilibrium. B) That price is operating effectively as a rationing mechanism. C) That producers are producing more than people want. D) Producers would be willing to produce more if price were allowed to rise. 4. What is the effect of a decrease in business taxes? A) It will cause an increase in the quantity supplied. B) It will cause an increase in demand. C) It will cause a decrease in demand. D) It will cause an increase in supply. Page 2
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Use the following to answer question 5: Price Quantity demanded Quantity supplied 0 200 0 .1 160 0 .2 120 40 .3 80 80 .4 40 120 .5 0 160 5. In table 3.4 a price ceiling of $0.2 means that: A) the market is in equilibrium because quantity demanded equals quantity supplied. B) there is a surplus in the market of 80 units. C) there is a shortage in the market of 40 units. D) there is a shortage in the market of 80 units. Use the following to answer question 6: Table 4.3 Here are data for a situation in which several variables change Year Income Price of x Q x demanded Price of y Q y demanded 1 $40 000 $140 50 $40 200 2 40 000 150 40 40 160 3 40 000 150 30 70 140 4 50 000 150 40 70 160 5 50 000 160 50 90 200 6. Referring to table 4.3, between years 4 and 5 both the price and the quantity demanded of X increased. What is the best possible explanation of this? A) Graphically, the demand curve for X must be upward sloping. B) Product Y is a complement of product X. C) Product X is a substitute for product Y. D) Graphically, the demand curve for product X must have shifted leftwards. Page 3
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7. If the quantity demanded of a good falls from 100 to 90 units when its price increases from $45 to $55 per unit, the price elasticity is: A) 1.67. B) 0.75. C) 0.53. D) 2.25. 8. Supposing that cigarette smokers demand is more price insensitive than the cigarette
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This note was uploaded on 05/08/2009 for the course AAE 580 taught by Professor Nnjkl during the Spring '09 term at Ohio State.

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Mic_mock_final - Name Date Use the following to answer question 1 1 In figure 3.8 what would be the result if a price ceiling is set which is $2

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