assign2B

assign2B - Intro Macro Section 4 Sheflin Spring 2009...

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Intro Macro Section 4 Sheflin Spring 2009 Assignment 2 B This is our first weekly supplementary assignment. You have to do the following: Read my explanations for Selected HW 2 Questions (in capitals) below Watch a 2 minute video clip Read the very brief news clip Review the BIG questions from assignment 2 Use the discussion boards to ask for help for anything you don’t understand. And then take an online hw quiz dealing with these 1. Explanations for the following HW 2 Questions (MY EXPLANATIONS IN CAPITALS) 6) The law of demand implies that if nothing else changes, there is 6) ______ _ A ) a linear relationship between price of a good and the quantity demanded. B) an exponential relationship between price of a good and the quantity demanded. C) a positive relationship between the price of a good and the quantity demanded. D ) a negative relationship between the price of a good and the quantity demanded. D - ‘LAW’ OF DEMAND – WHEN PRICE GOES UP, QUANTITY DEMANDED GOES DOWN. NOT REALLY A LAW, RATHER AN EMPIRICAL REGULARITY. A NEGATIVE RELATIONSHIP MEANS THAT WHEN ONE VARIABLE GOES UP, THE OTHER GOES DOWN 7) Which of the following influences people's buying plans and does not shift the demand curve? 7) ______ _ A ) the prices of related goods B) the price of the good C) preferences D ) income B THE QUANTITY OF ANY GOOD OR SERVICE PEOPLE DEMAND (WILLING AND ABLE TO BUY) DEPENDS ON PRICE, INCOME, TASTES, PRICES OF SUBSTITUTES AND COMPLEMENTS. OF THESE, A CHANGE IN PRICE MOVES ONE ALONG THE DEMAND CURVE (IN THE OPPOSITE DIRECTION OF THE PRICE CHANGE – THAT IS INVERSELY), WHILE A CHANGE IN ANY OF THE OTHERS SHIFTS THE WHOLE CURVE 12) A decrease in quantity demanded because of an increase in price is represented by a 12) _____ _ A ) movement up and to the left along the demand curve.
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B) movement down and to the right along the demand curve. C) rightward shift of the demand curve. D ) leftward shift of the demand curve. A – SEE PREVIOUS QUESTIONS 15) In the figure above, which movement reflects a decrease in quantity demanded but NOT a decrease in demand? 15) _____ _ A ) from point a to point d B) from point a to point e C) from point a to point c D ) from point a to point b B - DECREASE IN QUANTITY DEMANDED IS A MOVEMENT ALONG A DEMAND CURVE CAUSED **ONLY** BY AN INCREASE IN PRICE. IT IS A MOVEMENT ON THE SAME DEMAND CURVE 16) Demand is the 16) _____ _ A ) ability to pay for a good. B)
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This note was uploaded on 02/29/2012 for the course 320 322 taught by Professor Macro-williams,micro-yoshi during the Fall '10 term at Rutgers.

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assign2B - Intro Macro Section 4 Sheflin Spring 2009...

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