212 Supply, Demand, and Elasticity Quiz

212 Supply, Demand, and Elasticity Quiz - AcceptedAnswer

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  Accepted Answer 1. If a 20% decrease in the price of long distance phone calls leads to a 35% increase in  the quantity of calls demanded, you may conclude that the demand for phone calls is a. elastic. b. inelastic. c. unit elastic. d. stretchy elastic. 2. Which of the following pairs are examples of substitutes? a. Popcorn and Soda b. Automobiles and bicycles c. Boats and fishing tackle d. Wine and cheese 3. If a price in a competitive market is “too high to clear the market,” what does this  usually mean? Assume upward-sloping supply curves. a. No producer can cover the costs of production at that price. b. Quantity supplied exceeds quantity demanded at that price. c. Producers are leaving the industry. d. Consumers are willing to buy all the units produced at that price. 4. Which of the following statements is incorrect? Assume upward-sloping supply  curves. a. If the supply curve shifts left and the demand remains constant, equilibrium price will  rise. b. If the demand curve shifts left and the supply increase, equilibrium price will  rise.
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c. If the supply curve shifts right and the demand curve shifts left, equilibrium price will  fall. d. If the demand curve shifts right and the supply curve shifts left, price will rise. 5. Which of the following is true? a. Efficiency refers to the size of the economic pie; equity refers to how the pie is  divided . b. Government policies usually improve upon both equity and efficiency.
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This note was uploaded on 11/13/2010 for the course ECONOMICS ECO/212 taught by Professor Dr.sanchez during the Spring '10 term at University of Phoenix.

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212 Supply, Demand, and Elasticity Quiz - AcceptedAnswer

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