Microeconomics test 1 Flash Cards

 
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given a downsloping demand curve and an upsloping supply curve for a product, an increase in the price of a substitute good will increase equilibrium price and quantity 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
at the equilibrium price there are no pressures on price to either rise or fall 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
if a product is in surplus supply, its price is above equilibrium 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
by an increase in demand we mean that the quantity demanded at each price in a set of prices is greater 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
which of the following is most likely to be an inferior good used clothing 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
the income and substitution effects account for the downward sloping demand curve 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
the demand curve shows the relationship between price and quantity demanded 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
the law of demand states that price and quantity demanded are inversely related 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
the demand for a product is inelastic with respect to price if consumers are largely unresponsive to a per unit price change 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
the price elasticity of demand coefficient measures a buyer responsiveness to price changes 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
suppose you have a limited money income and you are purchasing products A and B whose prices happen to be the same. To maximize your utility you should purchase A and B in such amounts that Their marginal utilities are the same 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
the marginal utility of the last unit of A consumed is 12 and the marginal utility of the last unit B consumed is 8. what set of prices for A and B respectively would be consistent with consumer equilibrium $6 and $4 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
total fixed cost (TFC) does not change as total output increases or decreases 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
if a firm decides to produce no output in the short run, its costs will be its fixed cost 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
which of the following statements conceding the relationships between total product (TP) , average product (AP) and marginal product (MP) is NOT correct AP continues to rise so long as TP is rising 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
marginal product the increase in total output attributable to the employment of one more worker 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
the long run is characterized by the ability of the firm to change its plant size 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
the basic difference b/t short run and long run is at least one resource is fixed in the short run, while all resources are variable in the long run 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
which of the following is a short-run adjustment a local bakery hires two additional bakers 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
the basic characteristic of the short run is that the firm does not have sufficient time to change the size of its plant 1 dylang23 Sun, 07 Oct 2012 21:09:27 GMT view revision history
the law of diminishing returns explains diseconomies of scale False 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
if the marginal-cost curve lies below the average-variable-cost curve, the average-variable-cost curve must be falling True 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
the law of diminishing returns explains why the long run average total cost curve is U-shaped False 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
variable costs are costs that vary directly with output False 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
the short run is a period of time during which all costs are fixed costs False 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
The real opportunity cost of producing product X is the amounts of products Y, Z, and so forth, that might have been produced if resources had not been used to produce X True 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
returns to scale determine the shape of the long run average cost curve True 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
if a price and totally revenue are directly related, demand is inelastic True 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
the smaller the number of good substitutes for a product, the greater will be the price elasticity of demand for it False 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
A linear demand curve has a constant elasticity over the full range of the curve False 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
in a competitive market, there are sources moving the market towards an equilibrium True 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
A ceiling price in a competitive market will result in surpluses of a product False 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
a price floor in a competitive market will result in persistent shortages of a product False 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
in a competitive market, every consumer willing to pay the market price can buy a product and every producer willing to sell the product at that price can sell it True 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
if market demand increases and market supply decreases, the change in equilibrium price is unpredictable without first knowing the exact magnitudes of the demand and supply changes True 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
a government tax per unit of output reduces supply True 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
toothpaste and toothbrushes are substitute goods False 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
consumers buy more of normal goods as their incomes rise False 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
a government subsidy per unit of output increases supply True 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
an increase in demand accompanied by an increase in supply will increase the equilibrium quantity by the effect on equilibrium price will be indeterminate True 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
an increase in quantity supplied might be caused by an increase in production costs False 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
if demand increases and supply simultaneously decreases, equilibrium price will rise True 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
Surpluses drive market price up; shortages drive them down False 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
although sleeping in on a work day or school day has an opportunity cost, sleeping late on the weekends does not False 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
Products and services are scarce because resources are scarce True 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
The production possibilities curve shows various combinations of two products that an economy can produce when achieving full employment True 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
Choices entail marginal costs because resources are scarce True 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
certain inherently desirable products such as education and health care should be produced so long as resources are available True 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
normative statements are expressions of facts False 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history
an economic model is an ideal or utopian type of economy that society should strive to obtain through economic policy True 0 dylang23 Sun, 07 Oct 2012 20:56:05 GMT view revision history

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