1.
Oil refiners can vary the mix of gasoline versus diesel fuel derived from a barrel of oil. If the price of diesel fuel falls relative to the price of gasoline:
a. supply of gasoline will shift to the right.
b. supply of gasoline will shift to the left.
c. supply of both diesel fuel and gasoline will shift, but in opposite directions.
d. supply of diesel fuel will shift to the right.
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2.
If the market price is lower than the equilibrium price a:
a. shortage exists and the market price will rise until it equals the market price and the shortage is eliminated.
b. surplus exists and the market price will fall until it equals the equilibrium price and the surplus is eliminated.
c. surplus exists and the market price will rise until it equals the market price and the surplus is eliminated.
d. shortage exists and the market price will fall until it equals the equilibrium price and the shortage is eliminated.
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3.
The demand for a product tends to be elastic if:
a. it is inexpensive.
b. consumers are slow to respond to price changes.
c. a small proportion of consumer's income is spent on the good.
d. it has many substitutes.
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4. If two goods and services that can be used to fulfill a similar need or desire they are:
a. complements.
b. substitutes.
c. normal goods.
d. independent goods.
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5.
When the product demand curve is Q = 130 - 20P, and price is increased from P1 = $4 to P2 = $6, the arc price elasticity of demand is:
a. -0.1
b. -2.1
c. -3.3
d. -10
1.
Oil refiners can vary the mix of gasoline versus diesel fuel derived from a barrel of oil. If the price of diesel fuel falls relative to the price of gasoline:
a. supply of gasoline will shift to the right.
b. supply of gasoline will shift to the left.
c. supply of both diesel fuel and gasoline will shift, but in opposite directions.
d. supply of diesel fuel will shift to the right.
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2.
If the market price is lower than the equilibrium price a:
a. shortage exists and the market price will rise until it equals the market price and the shortage is eliminated.
b. surplus exists and the market price will fall until it equals the equilibrium price and the surplus is eliminated.
c. surplus exists and the market price will rise until it equals the market price and the surplus is eliminated.
d. shortage exists and the market price will fall until it equals the equilibrium price and the shortage is eliminated.
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3.
The demand for a product tends to be elastic if:
a. it is inexpensive.
b. consumers are slow to respond to price changes.
c. a small proportion of consumer's income is spent on the good.
d. it has many substitutes.
-----------------------------------------------------------------------------------------------------------------------------------
4. If two goods and services that can be used to fulfill a similar need or desire they are:
a. complements.
b. substitutes.
c. normal goods.
d. independent goods.
-----------------------------------------------------------------------------------------------------------------------------------
5.
When the product demand curve is Q = 130 - 20P, and price is increased from P1 = $4 to P2 = $6, the arc price elasticity of demand is:
a. -0.1
b. -2.1
c. -3.3
d. -10
