PRACTICE MC CH 8-17 ®Ó

PRACTICE MC CH 8-17 - 1 Market demand is Q = 100 – 10P Market supply is Q = 10P Equilibrium price and quantity are A 50 5 B 5 50 C 8 20 D 20,8 1

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Unformatted text preview: 1) Market demand is Q = 100 – 10P. Market supply is Q = 10P. Equilibrium price and quantity are A) 50, 5 B) 5, 50 C) 8, 20 D) 20,8. 1) Market demand is Q = 100 – 10P. Market supply is Q = 10P. Equilibrium price and quantity are A) 50, 5 B) 5, 50 C) 8, 20 D) 20,8. 2) Refer to Question #8. A tax on suppliers results in a new equation for supply: Q = 10P – 20. The new equilibrium quantity traded is A) 10 B) 20 C) 30 D) 40. 2) Refer to Question #8. A tax on suppliers results in a new equation for supply: Q = 10P – 20. The new equilibrium quantity traded is A) 10 B) 20 C) 30 D) 40. 3) Refer to Question #9. Consumers now pay ____ and producers now receive ____ A) $6, $6 B) $6, $4 C) $4, $6 D) $4, $4. 3) Refer to Question #9. Consumers now pay ____ and producers now receive ____ A) $6, $6 B) $6, $4 C) $4, $6 D) $4, $4. 4) Refer to Question #10. The government’s tax revenue is A) $40 B) $50 C) $80 D) $240. 4) Refer to Question #10. The government’s tax revenue is A) $40 B) $50 C) $80 D) $240. 5) Refer to Question #10. Which statement is true? A) demand is more elastic than supply B) supply is more elastic than demand C) demand and supply have the same elasticity D) demand and supply are both unit elastic. 5) Refer to Question #10. Which statement is true? A) demand is more elastic than supply B) supply is more elastic than demand C) demand and supply have the same elasticity D) demand and supply are both unit elastic. 6) Refer to Question #10. The deadweight loss due to taxation is A) $20 B) $10 C) 0 since consumers and producers share the burden of the tax equally D) insufficient information to determine. 6) Refer to Question #10. The deadweight loss due to taxation is A) $20 B) $10 C) 0 since consumers and producers share the burden of the tax equally D) insufficient information to determine. 7) Both Kate and Kyle own furniture factories that produce rocking chairs. In her factory Kate uses a production process that has very low fixed costs and very high variable costs. In his factory Kyle uses a production process that has very high fixed costs and very low variable costs. Currently, each factory is producing 100 rocking chairs at the same total cost. Which of the following statements is correct? If each produces A) less, their costs will be equal. B) more, their costs will be equal. C) more, the costs of Kate's factory will exceed those of Kyle's factory. D) less, the costs of Kate's factory will exceed those of Kyle's factory. 7) Both Kate and Kyle own furniture factories that produce rocking chairs. In her factory Kate uses a production process that has very low fixed costs and very high variable costs. In his factory Kyle uses a production process that has very high fixed costs and very low variable costs. Currently, each factory is producing 100 rocking chairs at the same total cost. Which of the following statements is correct? If each produces A) less, their costs will be equal....
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This note was uploaded on 03/13/2011 for the course ECON 1B03 taught by Professor Hannahholmes during the Spring '08 term at McMaster University.

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PRACTICE MC CH 8-17 - 1 Market demand is Q = 100 – 10P Market supply is Q = 10P Equilibrium price and quantity are A 50 5 B 5 50 C 8 20 D 20,8 1

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