Question
13. If the quantity demanded for a product exceeds the
quantity supplied the market price will rise until (Points : 1)
the quantity demanded equals the quantity supplied. The
product will then no longer be scarce.
quantity demanded equals quantity supplied. The equilibrium
price will then be greater than the market price.
only wealthy consumers will be able to afford the product.
quantity demanded equals quantity supplied. The market price
will then equal the equilibrium price.17. A tax is imposed on
employers and workers that are used to fund Social Security and
Medicare. This tax is sometimes referred to as (Points : 1)
the Income Security Tax.
the federal income tax.
the ACIF.
the payroll tax.
19. Brett buys a new cell phone for $100. He receives
consumer surplus of $80 from the purchase. How much does Brett
value his cell phone? (Points : 1)
$180
$100
$80
$20
20. The difference between the highest price a consumer is
willing to pay for a good and the price the consumer actually pays
is called (Points : 1)
producer surplus.
the substitution effect.
the income effect.
consumer surplus.
21. Suppose the demand curve for a product is downward sloping
and the supply curve is upward sloping. If a unit tax is imposed in
the market for this product, (Points : 1)
sellers bear the entire burden of the tax.
the tax burden will be shared among the government, buyers
and sellers.
buyers bear the entire burden of the tax.
the tax burden will be shared by buyers and sellers.
23. Consider the following pairs of items:
Which of the pairs listed will have a positive cross-price
elasticity? (Points : 1)
a and b only
c and d only
e only
a, b, and c only
24. The price elasticity of the supply of teenage labor services
is approximately 1.36. Suppose the minimum wage rises from $6.60
per hour to $7.00. Using the midpoint formula, calculate the
approximately change in the will the quantity supplied of teenage
labor. (Points : 1)
5.9 percent
13.6 percent
8 percent
There is insufficient information to answer the question.
26. Suppose at the going wage rate of $20 per hour, firms can
hire as many hours of janitorial services as it desires. If any
firm tries to lower the wage rate to $19, it will not be able to
hire any janitor. What does this indicate about the supply of
janitorial services curve? (Points : 1)
Supply is unit price elastic.
Supply is perfectly price elastic.
Supply is perfectly price inelastic.
Supply is relatively price inelastic.
27. When demand is unit price elastic, a change in price causes
total revenue to stay the same because (Points : 1)
the percentage change in quantity demanded exactly offsets
the percentage change in price.
buyers are buying the same quantity.
total revenue never changes with price changes.
the change in profit is offset by the change in production
cost.
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