Question 1(1 point)

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Suppose the demand curve for a product is given by: Q = 300 - 2P + 4I, where I is average income measured in thousands of dollars. The supply curve is Q = 3P - 50. If I = 25, the market clearing price and quantity for this product are __

Question 1 options:

80 and 190.

100 and 250

90 and 220.

100 and 250

None of the above

Question 2(1 point)

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Which of the following will cause a shift to the left in the supply curve of gasoline?

Question 2 options:

A decrease in the price of gasoline.

An increase in the wage rate of refinery workers.

Decrease in the price of crude oil.

An improvement in oil refining technology.

All of the above.

Question 3(1 point)

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Question 3 options:

$20 and 2600 tons.

$20 and 1600 tons.

$10 and 2600 tons.

$10 and 1600 tons.

None of the above

Question 4(1 point)

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Question 4 options:

100

150

200

250

Question 5(1 point)

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The price in the market has fallen and so has the quantity. This could be happening because

Question 5 options:

technology is rapidly advancing.

factor prices are falling.

both a and b are true.

supply has decreased

of reasons other than a or b because they would not make this happen.

Question 6(1 point)

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.The price of tacos was $0.29 in 1970 and it was $0.99 in 2003. The CPI was 39 in 1970 and was 117 in 2003. The 2003

price of tacos in 1970 dollars is:

Question 6 options:

$0.87

$0.58

$0.99

$0.33

none of the above

Question 7(1 point)

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A consumer has an income of $120 which he will spend on CD's and DVD's. He spends twice as much on CD's as he does on DVD's. He ends up buying ten CD's and two 2 DVD's. What was the price of a CD?

Question 7 options:

$8.00

$12.00.

$10.00.

$20.00

Cannot be determined from the information given.

Question 8(1 point)

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The slope of an indifference curve reveals:

Question 8 options:

that preferences are complete.

the marginal rate of substitution of one good for another good.

the ratio of market prices.

that preferences are transitive.

Both b and c.

Question 9(1 point)

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Suppose that demand is linear, Qd = 100 - 12P. At P = 5 and Q = 40, price elasticity of demand

Question 9 options:

-2/3

-2

-12

-3/2

Question 10(1 point)

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If Px = Py, then when the consumer maximizes utility,

Question 10 options:

Quantity consumed of X must equal quantity consumed of Y.

MU(x) must equal MU(y).

MU(x) may equal MU(y), but it is not necessarily so.

X and Y must be substitutes.

X and Y must be complements.