2.11 Supply and Demand

1Q. Which of the following statements about property rights is accurate? (2 points)

They are necessary for a command economy to function.

They prevent allocative inefficiency.

They prevent productive inefficiency.

They make free exchange in product and factor markets possible.

They are an essential feature common to market, command, and mixed economies.

2Q. Which of the following methods would produce an accurate market demand curve? (2 points)

Adding horizontally at each price all the individual marginal benefit curves in the market

Drawing a downward-sloping line through the equilibrium price in the market

Drawing the marginal cost curve from its lowest point up

Taking the derivative of all the suppliers' total product curves

Multiplying the equilibrium price by all quantities supplied

3Q. Which of the following could explain the change illustrated in the graph?

Price Supply B P2 C H P3 D J K G L Demand Q1 Q2 Q3 Quantity (units)Price Supply A B E P. C F Demand D Quantity Q. Qa (units)