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Practice Final - Econ 221 Final Multiple Choice Identify...

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Econ 221 Final Multiple Choice Identify the letter of the choice that best completes the statement or answers the question. ____ 1. Assume supply of X increased more than demand for X increased. The net effect would be a(n) a. increase in the equilibrium price and a decrease in the equilibrium quantity b. increase in the equilibrium price and an increase in the equilibrium quantity c. decrease in the equilibrium price and an increase in the equilibrium quantity d. decrease in the equilibrium price and a decrease in the equilibrium quantity e. none of the above ____ 2. Suppose supply falls in a market that was in equilibrium. Which of the following will happen if the price in that market does not change to its new equilibrium level? ____ 3. Suppose a price ceiling of $6 per unit is placed on kiwi when the equilibrium price is $5 per unit. What would be the outcome of this ceiling? ____ 4. Which of the following statements regarding deadweight loss is correct? ____ 5. Suppose a monopolist produces at an output where its marginal cost intersects its marginal revenue curve. Which of the following is true? a. it can raise profit by selling more b. it can raise profit by selling less c. it cannot raise its profit by selling more or less d. none of the above e. insufficient information to choose one of the above ____ 6. A result of welfare economics is that the equilibrium price of a product is considered to be the best price because it
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____ 7. Consumer surplus is ____
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