In 1998, the Kenyan government confiscated and burnt 12 tons of elephant ivory in a gesture to persuade the world to halt the ivory trade. They hoped that the gesture would reduce demand for ivory by bringing attention to illegal poaching.

Assume that demand and supply are neither perfectly elastic nor perfectly inelastic.

What is the effect on price in the ivory market if the gesture is effective?

The effect on price is ambiguous

Price decreases

Price remains the same

Price increases

What is the effect on quantity in the ivory market if the gesture is effective?

Quantity remains the same

Quantity increases

The effect on quantity is ambiguous

Quantity decreases

If the gesture is effective, ivory's price elasticity of demand ______ be estimated from this shock.

can

cannot

What is the effect on price in the ivory market if the gesture has no effect??

Price decreases

Price remains the same

Price increases

The effect on price is ambiguous

What is the effect on quantity in the ivory market if the gesture has no effect?

Quantity increases

Quantity remains the same

Quantity decreases

The effect on quantity is ambiguous

If the gesture has no effect, ivory's price elasticity of demand ______ be estimated from this shock.

cannot

can

In Cambridge, there are individuals from three different citizenships: Ethiopians, Brazilians, and Americans. Coffee is only sourced from Brazil and Ethiopia. Brazilians and Ethiopians only like to drink coffee from their own country, while for Americans a cup of coffee is the same regardless from its origin (Brazil or Ethiopia). All of them have the same level of income denoted byIandis some coefficient greater than0.

What is a utility function for Americans?

UA(b,e)=be,>0

UA(b,e)=(be)2,>0

UA(b,e)=b+e,>0

UA(b,e)=0

None of the above

UA(b,e)=b,>0

UA(b,e)=e,>0

UA(b,e)=be,>0

What is the magnitude (i.e. the absolute value) of the marginal rate of substitution for Americans? (Suppose Brazilian coffee is on they-axis.)

What is a utility function for Brazilians?

UB(b,e)=b+e,>0

UB(b,e)=e,>0

UB(b,e)=(be)2,>0

UB(b,e)=be,>0

UB(b,e)=b,>0

None of the above

UB(b,e)=be,>0

UB(b,e)=0

What is the magnitude (i.e. the absolute value) of the marginal rate of substitution for Brazilians? (Suppose Brazilian coffee is on they-axis.)

What is a utility function for Ethiopians?

UE(b,e)=0

UE(b,e)=(be)2,>0

UE(b,e)=be,>0

None of the above

UE(b,e)=b,>0

UE(b,e)=be,>0

UE(b,e)=e,>0

UE(b,e)=b+e,>0

Continuing with the above coffee example, ifpb

e=0,b=Ipb

None of the above

e=Ipb,b=0

e=Ipb,b=Ipe

e=0,b=Ipe

e=Ipe,b=0

e=Ipe,b=Ipb

Ifpb

e=Ipb,b=Ipe

e=0,b=Ipe

e=0,b=Ipb

e=Ipe,b=0

e=Ipe,b=Ipb

None of the above

e=Ipb,b=0

Ifpb

e=0,b=Ipe

e=Ipb,b=Ipe

None of the above

e=Ipb,b=0

e=0,b=Ipb

e=Ipe,b=Ipb

e=Ipe,b=0