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Suppose a 10 per cent increase in the price of pain relievers leads to a five per cent decrease in quantity demanded of pain relievers. The elasticity for pain relievers, with respect to price, is:

answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   -0.5.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 2

0 out of 1 points

Question 2 text

Incorrect

If there is a decrease in TV viewing for unpopular reality shows and a pay rise for people who assemble the imported parts to produce TV sets, in the market for TV the new equilibrium price is ____________ and the new equilibrium quantity is ________________.

Answer

Question 2 answers

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Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   indeterminate; lower

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 3

0 out of 1 points

Question 3 text

Incorrect

Market demand is given by qd = 10 - P, where qd is the quantity demand and P is the market price. The supply curve is given by qs = P, where qs is the quantity supplied. The market equilibrium quantity q* and price P* are:

Answer

Question 3 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   q* = 5; P* = 5

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 4

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Question 4 text

Incorrect

Which one of the following goods or services should have the lowest price elasticity of demand (in absolute terms) based on the share of income devoted to the good or service?

Answer

Question 4 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   Toothpicks

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 5

0 out of 1 points

Question 5 text

Incorrect

Consider the following diagram:

Picture

Assume demand remains unchanged at D1. If supply shifts from S1 to S2 the equilibrium price will ___________ and the equilibrium quantity will ___________.

Answer

Question 5 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   fall; rise

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 6

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Question 6 text

Incorrect

Consider the following graph:

Picture

At a price of $15, the market will experience ___________ in the amount of ___________ units.

Answer

Question 6 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   excess demand; 250

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 7

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Question 7 text

Incorrect

The demand curve illustrates the fact that consumers:

Answer

Question 7 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   tend to purchase more of a good as its price falls.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 8

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Question 8 text

Incorrect

In a market there are three consumers: consumer A has a demand curve represented by qa = 20 - P where qa is the quantity demanded by consumer A and P is the price; consumer B has a demand curve represented qb = 10 - P where qb is the quantity B demands; and qc = 60 - 3P represents the quantity demanded by consumer C where qc is the quantity demanded by C. What is the quantity demanded in the market when the price is $15?

Answer

Question 8 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   20 units

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 9

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Question 9 text

Incorrect

The demand for a good is said to be elastic with respect to price if the absolute value of its price elasticity is ____________ 1.

Answer

Question 9 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   greater than

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 10

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Question 10 text

Incorrect

If the demand curve for a perfectly inelastic good is Q = 1, a decrease in price of that good will:

Answer

Question 10 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   lead to no change in the quantity demanded.

Response Feedback:

incorrect

Question 1

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Question 1 text

Incorrect

One observes that the equilibrium price of apples falls and the equilibrium quantity increases. Which of the following best fits the observed data?

Answer

Question 1 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   Demand constant and an increase in supply.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 2

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Question 2 text

Incorrect

The change in quantity supplied that results from a change in price is known as:

Answer

Question 2 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   price elasticity of supply.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 3

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Question 3 text

Incorrect

Jessica's marginal cost of producing a pitcher of lemonade is $0.25. Therefore, $0.25 can also be called her:

Answer

Question 3 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   reservation price.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 4

0 out of 1 points

Question 4 text

Incorrect

A market comprised of a downward-sloping demand curve that intersects an upward-sloping supply curve is said to be stable when:

Answer

Question 4 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   at any price other than equilibrium, forces in the market move price towards the equilibrium.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 5

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Question 5 text

Incorrect

Consider the following graph:

Picture

At a price of $3, the market will experience ___________ in the amount of ___________ units.

Answer

Question 5 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   excess demand; five

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 6

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Question 6 text

Incorrect

Suppose that supply and demand for DVDs both decrease. One can predict that the:

Answer

Question 6 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   equilibrium quantity will fall but the equilibrium price could rise or fall.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 7

0 out of 1 points

Question 7 text

Incorrect

From time to time, governments have attempted to support farmers' incomes by preventing free-market adjustments in agricultural markets by setting a price floor. According to the efficiency principle, this action on the part of government:

Answer

Question 7 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   will not be efficient as all the gains from trade have not been exploited.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 8

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Question 8 text

Incorrect

McD is running a $0.99 Small Mac special. This is likely to cause:

Answer

Question 8 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   an increase in the quantity demanded.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 9

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Question 9 text

Incorrect

The demand for Toby Williams' concert is given by QD = 100 000 - 500P. The supply curve for seats at the concert is perfectly inelastic at 50 000. The equilibrium quantity traded and price will be ____________ and ____________ respectively.

Answer

Question 9 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   50 000; $100

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 10

0 out of 1 points

Question 10 text

Incorrect

When the price is $30 the demand for good Y is zero. When the price is $10 the quantity demand of good Y is 100 units. The price elasticity of demand (in absolute terms) according to the midpoint method is:

Answer

Question 10 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   2.

Response Feedback:

incorrect

Question 1

0 out of 1 points

Question 1 text

Incorrect

Consider the following graph:

Picture

At a price of $45, the market will experience _____________ in the amount of _____________ units.

Answer

Question 1 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   excess supply; 250

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 2

0 out of 1 points

Question 2 text

Incorrect

One observes that the equilibrium price of apples falls and the equilibrium quantity increases. Which of the following best fits the observed data?

Answer

Question 2 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   Demand constant and an increase in supply.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 3

0 out of 1 points

Question 3 text

Incorrect

One observes that the equilibrium price of T-shirts increases and the equilibrium quantity falls. Which of the following best fits the observed data?

Answer

Question 3 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   A decrease in supply with demand constant

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 4

0 out of 1 points

Question 4 text

Incorrect

Consider the following graph:

Picture

Which of the following changes could cause the demand curve to shift from D2 to D1?

Answer

Question 4 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   An expectation that the price will be lower in the future

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 5

0 out of 1 points

Question 5 text

Incorrect

If the demand curve for beets is P = 5, the absolute value of the price elasticity of demand is:

Answer

Question 5 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   infinity.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 6

0 out of 1 points

Question 6 text

Incorrect

Consider a market with one consumer with a demand curve q = 100 - 4P and an industry supply curve of P = 5. Four new consumers join the market. What happens to market price?

Answer

Question 6 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   P = 5

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 7

0 out of 1 points

Question 7 text

Incorrect

Suppose the price of doughnuts decreases and doughnut holes are a by-product of producing doughnuts. One would expect:

Answer

Question 7 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   the quantity supplied of doughnuts to decrease.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 8

0 out of 1 points

Question 8 text

Incorrect

For any vertical demand curve, the calculated price elasticity of demand is:

Answer

Question 8 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   0.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 9

0 out of 1 points

Question 9 text

Incorrect

If the price of rollerblades increases by one per cent and the quantity demanded falls by four per cent, the price elasticity of demand for rollerblades has a value of:

Answer

Question 9 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   4.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 10

0 out of 1 points

Question 10 text

Incorrect

Which of following is not true of an equilibrium price?

Answer

Question 10 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   It is always a fair and just price.

Response Feedback:

incorrect

Question 1

0 out of 1 points

Question 1 text

Incorrect

A market is an arrangement that facilitates trading of:

Answer

Question 1 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   All of the given answers.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 2

0 out of 1 points

Question 2 text

Incorrect

Consider the following table.

Picture

If the price of steak increases from $6 to $7, total revenues will _________, suggesting market demand is ________.

Answer

Question 2 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   decrease; elastic

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 3

0 out of 1 points

Question 3 text

Incorrect

If the demand curve for a perfectly inelastic good is Q = 1, a decrease in price of that good will:

Answer

Question 3 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   lead to no change in the quantity demanded.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 4

0 out of 1 points

Question 4 text

Incorrect

Consider the following graph:

Picture

Given that demand shifts from D1 to D2, the equilibrium quantity will:

Answer

Question 4 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   rise to 6 units.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 5

0 out of 1 points

Question 5 text

Incorrect

Elasticity is a measure of:

Answer

Question 5 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   how responsive one variable is to a change in one of the other things that determines it.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 6

0 out of 1 points

Question 6 text

Incorrect

The buyer's reservation price of a particular good or service is the:

Answer

Question 6 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   maximum amount one would be willing to pay for it.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 7

0 out of 1 points

Question 7 text

Incorrect

Consider the market for a normal good Y in which the law of demand holds. The price of a complement falls at the same time as consumer income rises. In this case:

Answer

Question 7 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   None of the given answers.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 8

0 out of 1 points

Question 8 text

Incorrect

For two goods, X and Y, to be classified as ___________, it must be the case that when the price of X rises, the demand for Y increases; and to be classified as ___________, it must be the case that when the price of X rises, the demand for Y decreases.

Answer

Question 8 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   substitutes; complements

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 9

0 out of 1 points

Question 9 text

Incorrect

Consider the following table:

Picture

Assume that column A and column B are demand and supply curves. At a price of $30, the market would experience:

Answer

Question 9 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   excess demand of 25 units.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 10

0 out of 1 points

Question 10 text

Incorrect

In the market for sausages, we observe that the new equilibrium price is higher than the old price and quantity demanded has risen. This could be explained by:

Answer

Question 10 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   a fall in consumer income where sausages are an inferior good.

Response Feedback:

incorrect

Question 1

0 out of 1 points

Question 1 text

Incorrect

A market is an arrangement that facilitates trading of:

Answer

Question 1 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   All of the given answers.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 2

0 out of 1 points

Question 2 text

Incorrect

Consider the following table.

Picture

If the price of steak increases from $6 to $7, total revenues will _________, suggesting market demand is ________.

Answer

Question 2 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   decrease; elastic

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 3

0 out of 1 points

Question 3 text

Incorrect

If the demand curve for a perfectly inelastic good is Q = 1, a decrease in price of that good will:

Answer

Question 3 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   lead to no change in the quantity demanded.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 4

0 out of 1 points

Question 4 text

Incorrect

Consider the following graph:

Picture

Given that demand shifts from D1 to D2, the equilibrium quantity will:

Answer

Question 4 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   rise to 6 units.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 5

0 out of 1 points

Question 5 text

Incorrect

Elasticity is a measure of:

Answer

Question 5 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   how responsive one variable is to a change in one of the other things that determines it.

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incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 6

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Question 6 text

Incorrect

The buyer's reservation price of a particular good or service is the:

Answer

Question 6 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   maximum amount one would be willing to pay for it.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 7

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Question 7 text

Incorrect

Consider the market for a normal good Y in which the law of demand holds. The price of a complement falls at the same time as consumer income rises. In this case:

Answer

Question 7 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   None of the given answers.

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incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 8

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Question 8 text

Incorrect

For two goods, X and Y, to be classified as ___________, it must be the case that when the price of X rises, the demand for Y increases; and to be classified as ___________, it must be the case that when the price of X rises, the demand for Y decreases.

Answer

Question 8 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   substitutes; complements

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incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 9

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Question 9 text

Incorrect

Consider the following table:

Picture

Assume that column A and column B are demand and supply curves. At a price of $30, the market would experience:

Answer

Question 9 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   excess demand of 25 units.

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incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 10

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Question 10 text

Incorrect

In the market for sausages, we observe that the new equilibrium price is higher than the old price and quantity demanded has risen. This could be explained by:

Answer

Question 10 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   a fall in consumer income where sausages are an inferior good.

Response Feedback:

incorrect

Question 1

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Question 1 text

Incorrect

For two goods, X and Y, to be classified as ___________, it must be the case that when the price of X rises, the demand for Y increases; and to be classified as ___________, it must be the case that when the price of X rises, the demand for Y decreases.

Answer

Question 1 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   substitutes; complements

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 2

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Question 2 text

Incorrect

In the market for sausages, we observe that the new equilibrium price is lower than the old price and quantity demanded has fallen. This could be explained by:

Answer

Question 2 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   an increase in consumer income, where sausages are an inferior good.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 3

0 out of 1 points

Question 3 text

Incorrect

Consider the following graph:

Picture

For demand curve D1, what is the price elasticity of demand when P = 12?

Answer

Question 3 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   3

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http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 4

0 out of 1 points

Question 4 text

Incorrect

'As the price of personal computers continues to fall, demand increases.' This headline is inaccurate because:

Answer

Question 4 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   falling prices for personal computers increases quantity demanded, not demand.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 5

0 out of 1 points

Question 5 text

Incorrect

Suppose there is a shortage of bananas in the fruit shops. What will restore the equilibrium?

Answer

Question 5 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   An increase in the price of bananas and a decrease in quantity demanded.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 6

0 out of 1 points

Question 6 text

Incorrect

If government imposes price controls that create excess demand or excess supply:

Answer

Question 6 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   the quantity traded must be lower than the original equilibrium quantity without government intervention.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 7

0 out of 1 points

Question 7 text

Incorrect

The demand for a good is said to be elastic with respect to price if the absolute value of its price elasticity is ____________ 1.

Answer

Question 7 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   greater than

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 8

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Question 8 text

Incorrect

If the market for sport utility vehicles has excess supply, then one can say that:

Answer

Question 8 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   quantity supplied is greater than quantity demanded.

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 9

0 out of 1 points

Question 9 text

Incorrect

Suppose the marginal cost of producing the third TV is $200 and the total cost of producing three TVs is $750. TVs are sold for $250 each. What is the seller's reservation price for the third TV?

Answer

Question 9 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   $200

Response Feedback:

incorrect

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/generic_updown.gifQuestion 10

0 out of 1 points

Question 10 text

Incorrect

For any vertical demand curve, the calculated price elasticity of demand is:

Answer

Question 10 answers

Selected Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/x.gif   [None Given]

Correct Answer:

http://lms-blackboard.telt.unsw.edu.au/images/ci/icons/check.gif   0.

Response Feedback:

incorrect