1- In which of the following cases will total revenues increase?

Select one:

a.price rises and demand is inelastic.

b.always when price rises, regardless of whether demand is elastic or inelastic.

c.price rises and demand is elastic.

d.price falls and demand is inelastic.

2- In which of the following situations is diminishing returns likely to occur?

Select one:

a.using variable amounts of labour and land to produce corn

b.using fixed amounts of labour on a fixed amount of land to produce corn

c.purchasing new capital equipment for a new business

d.using variable amounts of labour to grow wheat on a fixed amount of land

3- The elasticity of demand for a commodity will tend to be greater

Select one:

a.the greater the amount of time over which buyers adjust to a price change.

b.if the product is a "necessity" rather than a "luxury" good.

c.the smaller the number of substitute products available.

d.the smaller the proportion of one's income spent on the product.

4- The law of diminishing returns means that, as output increases in the short run,

Select one:

a.marginal costs will eventually rise.

b.total fixed cost will eventually rise.

c.marginal costs will eventually become constant.

d.marginal costs will eventually fall.

e.total fixed cost will eventually fall.

5- The marginal product of labour is the number of additional units of

Select one:

a.labour that must be hired for each additional unit of capital.

b.capital that must be purchased when one additional unit of labour is hired.

c.output that result from the hiring of one more unit of labour.

d.labour that must be hired to produce the current level of output.

e.labour that must be hired to produce one more unit of output.

6- The tax burden on consumers will be greater, the more 1) elastic is demand, 2) inelastic is demand, 3) elastic is supply, 4) inelastic is supply

Select one:

a.1 and 3

b.1 and 4

c.2 and 4

d.2

e.2 and 3