Exam 4: Using Supply and Demand

Table 4-A Use the following information about demand and supply schedules to answer the question. Price \ 12 5 9 19 14 \ 10 8 12 17 12 \ 8 11 15 15 10 \ 6 13 18 13 8 \ 4 16 21 11 6 \ 2 18 24 9 4 -Refer to Table 4-A.Suppose that D₁ and S₂ are the demand and supply schedules for Product A.If the government imposes a price floor of $6:

If the demand curve is perfectly elastic, the elasticity coefficient is ____ and the curve is ____.

Which of the following is true?

Figure 4-E -Refer to Figure 4-E.When the price rises from P₁ to P₂, producer surplus:

If a small change in price will lead to an infinite change in the quantity demanded, then the demand curve is:

Table 4-E The schedule below shows the prices that a consumer is willing to pay for pounds of shrimp: Price Per Pound Number of Pounds Consumed Each Year \ 20 1 \ 16 2 \ 12 3 \ 10 4 \ 6 5 \ 2 6 -Refer to Table 4-E.If the price of shrimp were to decrease from $12 to $10, the increase in consumer surplus would equal:

A tax is imposed on wine.Sellers will bear the full burden of this tax if the:

Which of the following is true about consumer surplus?

If an increase in price causes total expenditure on a product to decrease, then the price elasticity of demand is:

Figure 4-E -For a normal good, if incomes rise, we would expect that the equilibrium price will increase and that the equilibrium quantity will increase.

Based on the graph below, what is the producer surplus of the 10^th unit bought/sold?

Figure 4-A The diagram below represents the market for butter. -Refer to Figure 4-A.If a price ceiling of $2 is imposed, ____ units of butter will be sold.

Assume there is a price ceiling imposed on a good which is below the equilibrium price.Which of the following changes would reduce the size of the surplus?

Figure 4-D -Refer to Figure 4-D.When the price rises from P₁ to P₂, consumer surplus

Say that the equilibrium price of natural gas would be $5 per thousand cubic feet, but there is a price floor imposed at $7 per thousand cubic feet.That price floor is then lowered to $5 per thousand cubic feet.As a result,

Which of the following is true?

How does the equilibrium quantity change when there is an increase in supply and a decrease in demand?

What type of demand curve is depicted by the graph below?

Assume a price ceiling is imposed at the current equilibrium price in the market for wheat.If the supply of wheat then decreases as a result of bad weather, then:

Table 4-F The schedule below represents the willingness of a typical consumer to pay for wine in a year. Suppose there are 10,000 identical consumers in the community. Price Per bottles of Wine Consumed Bottle of Wine Per Year \ 50 1 440 2 \ 30 3 \ 20 4 \ 10 5 -Refer to Table 4-F.If the market price of wine is $20, the total consumer surplus for the community equals: