2 Your original decision to ski was bad 3 Your original decision to ski was

2 your original decision to ski was bad 3 your

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(2) Your original decision to ski was bad. (3) Your original decision to ski was based on imperfect or incomplete information. (4) All of the above are true. (5) None of the above are true. 5. Suppose growing concern with pet obesity results in an increased demand for diet pet food. Suppose at the same time that new govemment regulations result in a decreased supply of diet pet food. What will be the net impact on the equilibrium price and quantity of diet pet food bought and sold? (l) Higher Pe and higher Qe (2) Higher Pe and lower Qe (3) Lower Pe and lower Qe (4) Higher Pe but an indeterminate change in Qe (5) Indeterminate change in Pe and indeterminate change in Qe ) 3. t-
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'j ,fi The free market system, in which buyers and sellers are allowed to make their own buying and selling decisions without any govemment intervention, is expected to give us the best allocation of resources and the largest'economic pie, but only if we assume that: (1) Producers and consumers have access to perfect information about the products they are buying and selling (2) There are no extemalities that result from the consumption and production of the products being bought and sold. (3) There is perfect competition between buyers and sold. (4) All of the above (5) None of the above sellers of the products being bought and 7.Which of the following can be considered a positive statement? (1) When the price of a product falls, the quantity of the product consumers want to purchase also falls. (2) Warm winters are more pleasant then cold winters. (3) The growing obesity among American pets is a serious sociar problem. (4) It is important to read your course textbook in order to do well in your course. (5) None of the above is a positive statement. When we say society faces a problem of scarcity, we are saying that: (1) We have limited resources but even more limited wants. (2) We have unlimited resources but we are limited in our ability to efficiently use them. (3) we have limited resources to use to try to satisfy our unlimited wants. (4) We are unable to maximize economic efficiency. (5) We are unable to maximize social equity. Suppose that the cross-price elasticity of demand between apples and pears is equal to -0.5. Based solely on this information we would conclude that: (l) Apples and pears are complements. (2) An increase in the price of apples results in an increase in the demand for gg. (3) Apples and pears are completely unrelated goods. (4) Apples and pears are substitutes. (5) An increase in the price of pears results in an increase in the demand for apples. 10. Suppose you observe a75%o increase in the price of apples and as a result there is a25Vo increase in the demand for pears. Based on this information you can say that the cross price elasticity of demand between apples and pears is equal to _ and consumers consider apples and pears to be _.
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