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Practice Midterm #2

Practice Midterm #2 - 1 3 2 80 3 4 90 Midterm#2(Fall 2007 2...

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80 90 70 1 2 3 4 3 2 1 Midterm #2 (Fall 2007) Multiple Choice {Circle letter of best answer} 1. On a demand and supply diagram, the total revenue from sales of a good is shown as: a) a vertical distance. b) a horizontal distance. c) the area of a triangle. d) the area of a rectangle. 2. If the price elasticity of demand exceeds 1.0 but is less than infinity, demand is 3. If the price elasticity of demand is ____, the demand curve is ____. 4. A fall in the price of lemons from \$10.50 per bushel to \$9.50 increases the quantity demanded from 19,200 to 20,800. The price elasticity of demand in this range is 5. If the demand for a product is price inelastic, but not perfectly price inelastic, then a 10 percent decrease in its price causes the quantity demanded to increase by a) more than 10 percent. b) 10 percent. c) less than 10 percent. d) 0 percent. 6. If two different goods are complements, their 7. The price elasticity of supply measures 8. If the marginal social cost of the sixth slice of pizza is greater than the marginal social benefit, then the output level is

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Practice Midterm #2 - 1 3 2 80 3 4 90 Midterm#2(Fall 2007 2...

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