Suppose that the incomes of buyers in a particular market for an inferior good increase and there is also an increase in input prices. What would we expect to occur in this market? Select one: O a. The equilibrium price would increase, but the impact on the amount sold in the market would be ambiguous. O b. The equilibrium price would decreasebut the impact on the amount sold in the market would be ambiguous. Oc Equilibrium quantity would increase. but the impact on equilibrium price would be ambiguous. O d. Equilibrium quantity would decrease, but the impact on equilibrium price would be ambiguous

Suppose that the incomes of buyers in a particular market for an inferior good increase and there is also an increase in input prices. What would we expect to occur in this market? Select one: O a. The equilibrium price would increase, but the impact on the amount sold in the market would be ambiguous. O b. The equilibrium price would decreasebut the impact on the amount sold in the market would be ambiguous. Oc Equilibrium quantity would increase. but the impact on equilibrium price would be ambiguous. O d. Equilibrium quantity would decrease, but the impact on equilibrium price would be ambiguous

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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nich of the following statements relating to demand and supply is false? The substitution of higher-priced item with lower-priced goods by buyers is a reason why the quantity demanded of a good decreases when price increases. The demand curve of a good represents the value that individual buyers place on that good. Based on the income effect, the real income of buyers increases when the price of a good increases, and hence the quantity demanded of a good increases with price. O The supply curve of a good represents the opportunity costs to produce and sell the good for individual sellers of that good.
Suppose that coconuts and bananas are complements in consumption. Suppose further that the price of coconuts decreases while, at the same time, a fungal disease kills ten percent of the world's banana crop. Everything else held constant, the equilibrium price of bananas will equilibrium quantity of bananas transacted will and the Select one: O A. be ambiguous; be ambiguous O B. be ambiguous; increase O C. decrease; be ambiguous O D. decrease; increase O E. increase; decrease OF. decrease; decrease O G. be ambiguous; decrease O H. increase; be ambiguous increase; increase
An add in the newspaper claims that the price of milk will increase next week. At the same time, a new and improved pasteurization process makes milk production more efficient. Given these two effects, what can we say about the equilibrium price and quantity of milk? O Equilibrium price will decrease; the effect on quantity is ambiguous. O Equilibrium quantity will decrease, equilibrium price will increase. O Equilibrium price will increase; the effect on quantity is ambiguous. O Equilibrium quantity will increase; the effect on price is ambiguous.
FIGURE 2-4 Production possibilites curve Food Refer to Figure 2-4. If the economy chooses to shift more of its resources into clothing, what will it have to give up? Select one: O a. larger and larger amounts of food per unit of added clothing as the quantity of clothing produced increases O b. nothing, since food and clothing are NOT substitutes O c. relatively equal amounts of food per unit of added clothing as the quantity of clothing produced increases Clohing
Some years ago, it was discovered that aspirin can reduce an individual's risk of a heart attack. How do you think this affected the market diagram for aspirin? Select one: O a. The supply curve shifted to the right. O b. The price line shifted downwards. O c. The demand curve shifted to the right. O d. The supply curve shifted to the left. e. O e. The demand curve shifted to the left.
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Suppose that the incomes of buyers in a particular market for a normal good decrease and there is also a reduction in input prices. What would we expect to occur in this market? Select one: O a. Equilibrium quantity would decrease, but the impact on equilibrium price would be ambiguous. cross out O b. The equilibrium price would decrease, but the impact on the amount sold in the market would be ambiguous. cross out cross out O c. Equilibrium quantity would increase, but the impact on equilibrium price would be ambiguous. cross out O d. The equilibrium price would increase, but the impact on the amount sold in the market would be ambiguous.
QUESTION 12 Assume that the price of cheese has decreased and the price of garlic bread (a substitute good) has decreased at the same time. How this will affect the market for pizzas? O a. Quantity of pizza would fall, and the effect on price would be ambiguous. O b. Price of pizza would rise, and the effect on quantity would be ambiguous. O. Quantity of pizza would rise, and the effect on price would be ambiguous. O d. Price of pizza would fall, and the effect on quantity would be ambiguous. QUESTION 13 Samuel owns a laundromat business in Queens, New York. He recently purchased 2 new washing machines and 2 new dryers. This will cause O a. the demand for laundromat services to increase. O b. the supply of laundromat services to decrease. O c. the demand for laundromat services to decrease. O d. the supply of laundromat services to increase. QUESTION 16 A likely example of complementary goods for most people would be O a. golf club and baseball bat. O b. tea and coffee. O c. CPA…
people decide to paint their houses What is the appropriate response for the ? O Price of paint brushes decreases Home depot has a sale on paint Demand for paint brushes decreases ?
Air fares are generally lower on Tuesdays and Wednesdays each week. What is a likely explanation for this occurrence? O Supply is relatively variable, and lower demand on these days leads to a lower equilibrium price. O Demand is relatively variable, and lower supply leads to a lower equilibrium price. Lower levels of both supply and demand on these days lead to a lower equilibrium price. Supply is relatively fixed, and lower demand on these days leads to a lower equilibrium price. Demand is relatively fixed, and lower supply leads to a lower equilibrium price. OO
A large disruption in the world oil supply increases the price of oil for a long while. What will happen to the price and quantity of Hybrid cars in the U.S.? O Equilibrium price rises, equilibrium quantity rises. O Equilibrium price falls, equilibrium quantity rises. Equilibrium price rises, equilibrium quantity falls O Equilibrium price rises, equilibrium quantity falls