Winston-Salem/Forsyth County Schools / Front Page
Section 9 Practice Test
Multiple Choice
Identify the choice that best completes the statement or answers the question.
1. If the price of a good is increased by 20% and the quantity demanded changes by 15%, then the price elasticity of demand is equal to:
|a. |0.75. |
|b. |approximately 0.33. |
|c. |approximately 1.33. |
|d. |1. |
|e. |zero. |
2. If the demand curve is downward sloping, as calculated the price elasticity of demand is:
|a. |always positive. |
|b. |always greater than 1. |
|c. |usually equal to 1. |
|d. |always negative. |
|e. |always equal to zero. |
3. Gas prices recently increased by 25%. In response, purchases of gasoline decreased by 5%. Based on this data, the price elasticity of demand for gas is:
|a. |5. |
|b. |2. |
|c. |0.2. |
|d. |0.5. |
|e. |1.5. |
Figure 47-1: Demand for Shirts
[pic]
4. (Figure 47-1: Demand for Shirts) The absolute value of the price elasticity of demand for the segment AB is:
|a. |less than the price elasticity of demand for segment BC. |
|b. |is less than the price elasticity of demand for segment EF. |
|c. |is zero. |
|d. |is equal to the price elasticity of demand for segment BC. |
|e. |is greater than the price elasticity of demand for segment BC. |
5. Suppose the price of barley increases by 16.53%. If breweries buy 3.28% less barley after the price increase, the total revenue for barley producers will ________ due to the ________ effect being greater than the ________ effect.
|a. |decrease; quantity; price |
|b. |increase; price; quantity |
|c. |not change; quantity; price |
|d. |increase; quantity; price |
|e. |decrease; price; quantity |
6. If total revenue goes down when price falls, the price elasticity of demand is said to be:
|a. |price-inelastic. |
|b. |price unit-elastic. |
|c. |price-elastic. |
|d. |perfectly price-elastic. |
|e. |equal to one. |
7. Suppose the price of cereal rose by 25% and the quantity of milk sold decreased by 50%. Then we know that the:
|a. |cross-price elasticity between cereal and milk is –2. |
|b. |cross-price elasticity between cereal and milk is –0.5. |
|c. |price elasticity of demand for milk is 2. |
|d. |cross-price elasticity of demand for milk is 2. |
|e. |price elasticity of demand for cereal is 0.5. |
8. If your purchases of shoes decrease from 11 pairs per year to 9 pairs per year when the price of shirts increases from $8 to $12, then, for you, shoes and shirts are considered:
|a. |inferior goods. |
|b. |luxury goods. |
|c. |substitute goods. |
|d. |complementary goods. |
|e. |unrelated goods. |
Table 48-1: Johnson’s Income and Expenditures
|Monthly |Quantity Purchased per Month |
|Income | |
| |Steaks |Magazines |Movies |Pizzas |
|$2,000 |2 |4 |6 |8 |
|$3,000 |2 |6 |6 |6 |
|Table 48-1: Johnson's Income and Expenditures |
9. (Table 48-1: Johnson's Income and Expenditures) Johnson's income elasticity of demand for magazines is:
|a. |negative. |
|b. |0. |
|c. |greater than 0 but less than 1. |
|d. |1. |
|e. |greater than 1. |
Table 49-1: Consumer Surplus and Phantom Tickets
|Student |Willingness to Pay |
|Jessica |$150 |
|Jacquelyn |125 |
|Brad |105 |
|Robert |60 |
|Gwen |25 |
|Table 49-1: Consumer Surplus and Phantom Tickets |
10. (Table 49-1: Consumer Surplus and Phantom Tickets) If the box-office price of a ticket to see Phantom of the Opera is $50, and there is no other market for tickets, then total consumer surplus for the five students is:
|a. |$100. |
|b. |$175. |
|c. |$230. |
|d. |$240. |
|e. |$200. |
|This table shows some Atlanta college students' |
|willingness to pay to see The Nutty Nutcracker, by the |
|Atlanta Ballet. |
|Student |Willingness to Pay |
|Lois |$100 |
|Miguel |90 |
|Narum |65 |
|Oscar |50 |
|Pat |15 |
|Table 49-2: Consumer Surplus |
11. (Table 49-2: Consumer Surplus) If the price of a ticket to see The Nutty Nutcracker is $50, then Narum's consumer surplus is:
|a. |$60. |
|b. |$50. |
|c. |$15. |
|d. |$240. |
|e. |$115. |
Figure 49-2: Consumer Surplus II
[pic]
12. (Figure 49-2: Consumer Surplus II) At a price of P1, consumer surplus equals the area:
|a. |ABP2. |
|b. |AFP1. |
|c. |AQ30. |
|d. |P1P2BF. |
|e. |0P1FQ1. |
13. Suppose the government imposes a $10 excise tax on the sale of sweaters by charging suppliers $10 for each sweater sold. If the demand curve for sweaters is downward sloping, we would predict that:
|a. |the price of sweaters will increase by $10. |
|b. |consumers of sweaters will bear the entire burden of the tax. |
|c. |the quantity of sweaters purchased will increase. |
|d. |the price of sweaters will decrease by $10. |
|e. |the price of sweaters will increase by less than $10. |
Scenario 50-1: Market for Taxi Rides
[pic]
|Fare |Quantity Demanded |Quantity Supplied |
|(per ride) |(millions of |(millions of |
| |rides per year) |rides per year) |
|$7.00 |6 |14 |
|6.50 |7 |13 |
|6.00 |8 |12 |
|5.50 |9 |11 |
|5.00 |10 |10 |
|4.50 |11 |9 |
|4.00 |12 |8 |
|3.50 |13 |7 |
|3.00 |14 |6 |
14. (Scenario 50-1: Market for Taxi Rides) The figure represents a competitive market for taxi rides. If the government now imposes an excise tax of $3 per ride (causing the supply curve to shift upward by that amount), then the government will collect tax revenues of ________, which might be used for worthwhile purposes, but there will be a deadweight loss to society of ________ caused by this tax.
|a. |$9 million; $1 million |
|b. |$16 million; $2 million |
|c. |$21 million; $4.5 million |
|d. |$24 million; $6 million |
|e. |$12 million; $4 million |
Figure 50-6: Market for Yachts
[pic]
15. (Figure 50-6: Market for Yachts) If the government imposes a $30,000 tax on yachts (collected from the producers), consumers will pay ________ of the tax and producers will pay ________.
|a. |$20,000; $10,000 |
|b. |$15,000; $15,000 |
|c. |$10,000; $20,000 |
|d. |$5,000; $25,000 |
|e. |$30,000; $0 |
Figure 50-8: The Gas Market
[pic]
16. (Figure 50-8: The Gas Market) The figure represents the market for gasoline. An excise tax has been levied on each gallon of gasoline supplied by producers. What is the tax rate?
|a. |$1.50 per gallon |
|b. |$1 per gallon |
|c. |$22,500 |
|d. |$15,000 |
|e. |$4 per gallon. |
17. Assume that the marginal utilities for the first three units of a good consumed are 200, 150, and 125, respectively. The total utility for the first unit is:
|a. |125. |
|b. |150. |
|c. |200. |
|d. |350. |
|e. |475. |
|Units |0 |1 |2 |3 |4 |5 |6 |7 |
|Total Utility |0 |20 |35 |45 |50 |50 |45 |35 |
|Table 51-1: Utility |
18. (Table 51-1: Utility) The marginal utility for the fifth unit is:
|a. |15. |
|b. |10. |
|c. |5. |
|d. |0. |
|e. |50. |
|Hours of |Total Utility |
|Exercise | |
|0 |0 |
|1 |5 |
|2 |15 |
|3 |23 |
|4 |29 |
|5 |33 |
|Table 51-2: Exercise and Total Utility |
19. (Table 51-2: Exercise and Total Utility) The table shows a consumer's total utility from consuming hours of exercise at the gym. Given this information, what can be said about this consumer's marginal utility curve for exercise?
|a. |Marginal utility initially decreases, but eventually increases as more exercise is consumed. |
|b. |Marginal utility always decreases as more exercise is consumed. |
|c. |Marginal utility always increases as more exercise is consumed. |
|d. |Marginal utility initially increases, but eventually stays constant as more exercise is consumed. |
|e. |Marginal utility initially increases, but eventually decreases as more exercise is consumed. |
Figure 51-1: Budget Lines for Tea and Scones
[pic]
20. (Figure 51-1: Budget Lines for Tea and Scones) For months now, Agnes has had $20 per month to spend on tea and scones. The price of each cup of tea and each scone has been $1. Which chart(s) in the figure show(s) what will happen to her budget line if her income decreases to $10?
|a. |Chart A |
|b. |Chart B |
|c. |Chart C |
|d. |Chart D |
|e. |Chart B and C |
................
................
In order to avoid copyright disputes, this page is only a partial summary.
To fulfill the demand for quickly locating and searching documents.
It is intelligent file search solution for home and business.
Related download
- winston salem forsyth county schools front page
- chapter 14 solutions to text problems
- prohibited items items that often require pre purchase
- solutions to text problems suny geneseo
- student notes prep session topic sampling distributions
- university of wisconsin madison
- the final report and findings of the safe school
- outbreak movie assignment
- movie study guide the patriot
Related searches
- city of winston salem website
- city of winston salem nc
- winston salem journal
- winston salem water bill
- cross technologies winston salem nc
- winston salem utilities payment
- best neighborhoods winston salem nc
- city of winston salem nc jobs
- city of winston salem sanitation department
- city of winston salem bill pay
- red cross winston salem nc
- winston salem utility water