Question 17 Questions, mostly multiple choices: Micro-Economics

05 Jun Question 17 Questions, mostly multiple choices: Micro-Economics

Question
17 Questions, mostly multiple choices: Micro-Economics

Response must be returned no later than October 12, by 12noon Est. If you cannot make this deadline, then I would cancel this order. By accepting this deadline you are agreeing to deliver on time.

1-35) Table 10.2 contains price, demand, and cost data for the Capri Theater, the only first‐run movie theater in a small town. What is its revenue from non‐students under the single price policy?

2-36)Table 10.2 containsprice,demand, and cost data for the CapriTheater,the onlyfirst‐runmovie theaterina small town.Whatisitstotalprofitunder the single price policy?

3-28) Sincea largeora small windturbinehavesimilarinstallation,operatingandmaintenance costs, buta large turbine has four timesthe generatingcapacity but costslessthan three timesasmuchasa small turbine,theaverage cost ofgeneratingelectricity withwindis:

A)constant at each output.

B) at first decreasingandthen increasing as output rises.

C)increasingasoutput increases.

D)decreasing asoutput increases.

6-15) Which of the followinggoods is likelyto have themost elastic demand?

A)movie B)electricity C)cigarettes D)gasoline

Figure 7.4

The above figure representsthe marginal utilityper dollarfor candybarsandoranges for Sophia.Thepriceofeachproductis $0.50,andSophia hasa budget of $4.

7-24) Refer to Figure7.4.If Sophia relies solelyongut feelings,shewillpurchase candy bars and oranges to maximizeutility.

8-12) Supposethat a newadvertising campaignextolling the virtuesof apple juiceissuccessful, anda majorfreezedestroys halfofthe countryʹs applecrop.What happensto the priceand quantity of apple juice?

A)Theequilibrium price of apple juicemight rise orfall andthe equilibrium quantity of apple juicefalls.

B)Theequilibrium price of apple juice risesand the equilibrium quantity of apple juice might riseorfall.

C)The equilibrium price of apple juicemight rise orfall andthe equilibrium quantity of apple juicerises.

D) The equilibrium price of apple juice falls and the equilibrium quantity of apple juice might rise or fall.

9-39)Inamonopolisticallycompetitive market,there:

A) aresubstantial barriers to entry.

B) are many firmsthat have slight controlover theprice theycharge fortheir product.

C)isonlyonefirm that sellsmanysimilaryet slightly different products.

D) are many firms selling an identicalproduct.

Kites/hour

Snowboards

/hour

Jesse

8

1

April

12

3

Table 3.2

10-8) Consider two individuals,JesseandApril,who hand paint kites and snowboards.Table3.2showshow much ofeach goodJesseand April can paintin one hour.Whichofthe following istrue?

A) Aprilhasacomparative advantage in paintingkitesbut notsnowboards.

B)April hasa comparativeadvantage in painting snowboards butnot kites. C)Aprilhasacomparative advantage in paintingboth goods.

D)April doesnot have acomparative advantagein paintingeither good.

11-16) Supposethat the income elasticityof demandforgood X ispositive butlessthan1.Otherthings beingequal, which of the followingstatements isINCORRECT?

A) Aconsumer buysmoreX asincome risesand the share of income spent ongood X alsorises.

B)Good Xisanormalgood.

C)ThequantitydemandedofgoodX decreasesasa consumerʹsincomedeclines.

D)Aconsumer buysmoreX as income rises,but the share of income spent ongood X falls.

12-2) Kaitlynand Larissa have formeda dogbathingandgrooming business.The numberof dogsthey can bathe or groom inanygivendayisdepicted in Table2.1.The opportunitycost ofgroomingthe third dog ina dayisbathing dog(s).

13-33)Ifthe demandforaproduct inanincreasing cost perfectlycompetitive industrydecreases, we would expect that price in the longrun would and thenumber of firmsin themarket would . 33)

A)decrease;decrease B) increase; decrease

C)increase; increase D)decrease; increase

14-32)Figure9.2 showsthecost structure of a firm ina perfectly competitive market. Supposethecurrent market priceis $10

and thefirmproduces theprofitmaximizingoutputlevel.Ifthefirmʹstotal fixed cost increasesdue to anew government regulation,the short‐run response ofthefirmshould be to:

Note:sincethe questiondoesnot restrict the firmʹsresponse to the short run, wecanʹt ruleoutthat the risein fixedcost willpush thefirm below the breakevenpoint and that the firm will exit theindustryinthe longrun,thus decreasingits current output level.

A)decreaseitscurrent output level. B) increaseitscurrent output level.

C)produce itscurrent output level. D)Thereisnʹt sufficient information.

15-17) Supposethat animport restrictionsresult in the percentagechange insupplyis20%, the price elasticityofdemandis 3,andthe price elasticityofsupplyis 2.What isthe percentagechange inthe equilibrium price?

16-13

Figure 4.5 illustrates a set of supply and demand curves for hamburgers. A increase in supply and a increase in demand are represented by a movement from:

A) point c to point a. B) point a to point b.

C) point d to point a. D) point d to point b.

17-14)IfMaria spendsafixed dollaramount per week on movie rentalsregardlessofchanges inthe price, Mariaʹsdemand for movierentalcan beconsidered:

A)elastic.

B) inelastic.

C)unit elastic.

D)Thereis no sufficient informationtodetermine the price elasticity.