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- 1. Mary buys three goods: A, B, and C. When her income rises she buys less of good B and more of goods A and C. When the price of good C rises she buys more of good A and less of good B. Which goods are normal? a. A and C b. B c. all of them d. C and B 2. The price of a good has gone down. What would be a good explanation of this? a. the cost of a key input used to produce the good has declined. b. there are now fewer firms selling the good. c. the price of a substitute good has gone up. d. there was an excess demand for the good in the market. 3.Under what circumstances is the production possibilities frontier a straight line? a. when there are constant opportunity costs of production b. the production possibilities frontier is always a straight line c. the production possibilities frontier is never a straight line d. when there are increasing opportunity costs of productionProvide short answer for the following. 1.Why is it that the production possibilities curve is bowed outward? 2.Why has the government placed price floors on some agricultural goods? 3. Income effect of a price change.1. If the demand curve for product A moves to the right, and the price of product B increases, it can be concluded that: A. A and B are substitute goods;B. A and B are complementary goods; C. A is an inferior good, and B is a superior good; D. Both goods A and B are inferior.2. If a point falls inside the production possibility curve, what does it indicate ?A Resources are over utilizedB Resources are under utilizedC There is employment in the economyD Both (b) and (c)3. In which type of economy do consumers and producers make their choices based on the market forces of demand and supply?(a) Open Economy(b) Controlled Economy(c) Command Economy(d) Market Economy4. In a free market economy, when consumers increase their purchase of a goods and the level of _______ exceeds _______ then prices tend to riseA Demand, SupplyB Supply, DemandC Prices, DemandD Profits, Supply 5) Scarcity requires that people mustA) cooperate.B) compete.C) trade.D) make…
- If we assume that a cafe owner wants to increase the number of people she can serve lunch to and is considering whether to put in more tables or hire another server. Which two resources is the owner considering as substitutes in production? (A) Labor and land (B) Labor and entrepreneurial ability (C) Labor and capital (D) Capital and entrepreneurial ability (E) Capital and land10- Which of the following deals with Lionel Robbins definition of economics? a. behavior associated with using limited and scarce resources. b. None of these c. the distribution of surplus goods to those in need. d. ways to reduce wants to remove the problem of scarcity.A controversial issue in managing climate change is the effect of taxes on gasoline. Higher taxes would reduce the after-tax price received by gasoline producers. The price elasticity of the supply of gasoline has been estimated to be 2.0.a. Explain why the price elasticity of supply is positive.b. Suppose that a tax on gasoline reduces the after-tax price of gasoline by 5%. By how much would suppliers reduce gasoline production?c. Compare the effect of the tax on gasoline in the short vis-à-vis long run.
- As the price rises, the quantity demanded by the buyer will decline and the quantity supplied by sellers will increase until it reaches the point when there is no shortage. Therefore, identify and explain the point where there is no shortage happen. Production means the process of using factors of production to produce goods and services. The inputs bought and used in the production of a given product are classified into four factors of productions. Describe the FOUR (4) factors of production with examples Ans all1. The Smith family eats both meat and potatoes on a regular basis and we need to know how the family views these goods. If the price of meats rises and the family eats more potatoes, then the two goods must be a. Substitutes b. Complements c. Inferior d. Normal 2. Which of the following is not a determinant of Supply? a. Prices of resources b. Technology and productivity c. Prices of Complements d. Producers’ expectations e. The number of producers 3. In December, both the price of Christmas trees and the quantity of trees sold rises. Is this a violation of the Law of Demand? Explain your answer 4. Explain the following statement in terms of Supply and Demand: “When a war breaks out in the Middle East, the price of gasoline rises and the price of a used Cadillac falls”.What is Microeconomics? What is the price elasticity of demand? What are the various methods of computing elasticity of supply? Explain the concept of positive and normative economics? Enumerate the 3 Steps in formulating policy?
- - As the opportunity cost of a good decreases, people buy Select one: a. more of that good and also more of its complements. b. less of that good but more of its complements. c. more of that good but less of its complements. d. less of that good and also less of its complements. - In broad terms what is the difference between microeconomics and macroeconomics? Select one: a. They use different sets of tools and ideas. b. Macroeconomics studies the effects of government regulation and taxes on the price of individual goods and services whereas microeconomics does not. c. Microeconomics studies the effects of government taxes on the national unemployment rate. d. Microeconomics studies decisions of individual people and firms and macroeconomics studies the entire national economy. - What will happen when there is a fall in price? Select one: a. Leads to a higher level of production b. Will cause an outward shift of supply c. Leads to a movement along a demand…3.a. State and explain the First Theorem of Welfare Economics and discuss its economicimplications and significance.b. State and explain the Second Theorem of Welfare Economics and discuss its economicimplications and significance.c. Explain the concept of production possibility frontier and interpret the slope of theproduction possibility frontier in economic terms.1. It is primarily the basis of economic activity a. economics b. scarcity c. social science d. abundance 2. What happen to the demand for tilapia if the price of bangus will go down? a. prices of tilapia remains b. price of bangus remains c. shift to the right d. shift to the left If cruz family lessens their demand expenditures for rice because they want pandesal for their breakfast, this is a. time efficient b. taste and preference c. decrease in income d. saving for cooking gas
