Supply and Demand and Points Question

Question 1 1.
According to the law of demand states that, other things remaining unchanged:
Answer
| a. | as price decreases, demand decreases. | | b. | as price increases, demand increases. | | c. | price has no effect on quantity demanded. | | d. | as price decreases, quantity demanded increases. | | e. | None of the above. |
1 points
Question 2 1.
At any price, the market demand curve:
Answer
| a. | is flatter than the flattest individual demand curve. | | b. | has a slope that is the average of the individual demand curve slopes. | | c. | is steeper than the steepest individual demand curve. | | d. | has a horizontal intercept equal to the average of the individual demand curve horizontal intercepts. | | e. | None of the above. |
1 points
Question 3 1.
The market demand curve for any good is:
Answer
| a. | independent of individual consumers’ demand curves for the good. | | b. | the vertical summation of individual consumers’ demand curves. | | c. | the horizontal summation of individual consumers’ demand curves. | | d. | derived from the firms’ marginal cost curves. | | e. | None of the above. |
1 points
Question 4 1.
An increase in per-capita income will probably result in:
Answer
| a. | an increase in quantity demanded. | | b. | an increase in demand. | | c. | a decrease in quantity demanded. | | d. | a decrease in demand. | | e. | Answers a and b are correct. |
1 points
Question 5 1.
Suppose the demand for good x is given by Qxd= A + βxPx + βyPy + βMM. By the law of demand, the value of βx must be:
Answer
| a. | between zero and one. | | b. | greater than one. | | c. | negative. | | d. | less than negative one. | | e. | between zero and negative one. |
1 points
Question 6 1.
Suppose the demand for good x is given by Qxd= A + βxPx + βyPy + βMM. If βy is negative, then good y is:
Answer
| a. | a