Exam 4: Demand and Supply Applications

Refer to the information provided in Figure 4.5 below to answer the questions that follow. Figure 4.5 -Refer to Figure 4.5. If the United States eliminates all taxes on CD-Rom drives, which of the following would occur?

When supply is fixed or the product is unique, then price is

Refer to the information provided in Figure 4.5 below to answer the questions that follow. Figure 4.5 -Refer to Figure 4.5. Assume that initially there is free trade. If the United States then imposes a $10.00 tax per CD-Rom drive on imported CD-Rom drives,

The adjustment of ________ is the rationing mechanism in market economies.

Refer to the information provided in Figure 4.5 below to answer the questions that follow. Figure 4.5 -Refer to Figure 4.5. At the world price of $15 per CD-Rom drive, the United States imports ________ million CD-Rom drives.

Refer to the information provided in Figure 4.6 below to answer the questions that follow. Equilibrium in this market occurs at the intersection of curves S and D. Figure 4.6 -In figure 4.6 at equilibrium, producer surplus is area

An example of a price ceiling would be the government setting the price of sugar

A price ceiling is

A firm that sells a car for $30,000 gets producer surplus of $30,000.

Refer to the information provided in Figure 4.1 below to answer the questions that follow. Figure 4.1 -Refer to Figure 4.1. Assume that initially there is free trade. If the United States then imposes a 10-cent tax per apple,

Related to the Economics in Practice on page 82: If a hurricane results in the supply of hotel rooms decreasing and the demand for hotel rooms increases, the equilibrium price for hotel rooms ________ and the equilibrium quantity of hotel rooms ________.

A U.S. import fee on oil would reduce the domestic quantity of oil supplied.

Favored customers receive special treatment from dealers during periods of excess demand.

A U.S. import fee on oil would reduce the domestic quantity demanded of oil.

If the price floor is set above the equilibrium price,

Refer to the information provided in Figure 4.1 below to answer the questions that follow. Figure 4.1 -Refer to Figure 4.1. If a 10-cent-per-apple tax is levied on imported apples, the United States will

If the market price of coffee is $3.00 per pound but the government will not allow coffee growers to charge more than $2.00 per pound of coffee, which of the following will happen?

A price floor is

The total of consumer plus producer surplus is largest at the market equilibrium.

Refer to the information provided in Figure 4.6 below to answer the questions that follow. Equilibrium in this market occurs at the intersection of curves S and D. Figure 4.6 -In figure 4.6 if price goes from equilibrium to P1, producer surplus changes by the area