Homework Answers
In demand and supply analysis the equilibrium “P” and “Q” will be determined by the intersection of “demand” and “supply”. Now, a “Price floor” is binding if it is above the equilibrium “P”. So, for nonbinding price floor “P” is below the equilibrium level. So, the imposition of non-bonding price floor will not have any effect on “P” and “Q”.
So, the 2nd option is the correct option, “the price or quantity of the product sold on the legal market will not change”.
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O The quantity demanded will always be smaller than the quantity su Question 8 2 pts...
It had no effect on consumers or firms in this situation. O It increased the incentive...
It had no effect on consumers or firms in this situation. O It increased the incentive of individuals to supply the good on the black market. Question 7 2 pts A nonbinding price floor has which of the following consequences? O There will be downward pressure on prices until quantity demanded equals quantity supplied. O There will be upward pressure on prices until quantity demanded equals quantity supplied. O There are no consequences to a nonbinding price floor. The quantity...
7. What will happen in a market where a binding price ceiling is removed? a....
7. What will happen in a market where a binding price ceiling is removed? a. There will be downward pressure on the price in the legal market. b. The products sold will improve in quality and become more plentiful. c. Sellers will face a reduced incentive to sell the product. d. Buyers will find the good more difficult to obtain in the legal market. e. There will be increased pressure to buy and sell the good on the black...
O The price and quantity will not change in the legal market There will be inereased...
O The price and quantity will not change in the legal market There will be inereased pressure to buy and sell the goods on the black market. Question2 2 pts Why does a shortage that occurs under a binding price ceiling increase over time? O Demand and supply both become more elastic. ® Demand and supply both become more inelastic O Demand becomes more elastic, but supply becomes more inelastic. 2 pts DQuestion 3
Question 3 1 pts Aaron's Angela's Austin's Alyssa's Price Quantity Quantity Quantity Quantity Demanded Demanded Demanded...
Question 3 1 pts Aaron's Angela's Austin's Alyssa's Price Quantity Quantity Quantity Quantity Demanded Demanded Demanded Demanded $0.00 20 16 4 $0.50 18 12 $1.00 14 10 2 $1.50 12 8 4 $2.00 6 $2.50 0 4 0 Whose demand does not obey the law of demand? O Alyssa's O Austin's O Aaron's O Angela's
Question 11 0.16 pts If the price and quantity for an inferior good, Good X, is...
Question 11 0.16 pts If the price and quantity for an inferior good, Good X, is $8 and 6 units at the original equilibrium, what is one possibility for the new equilibrium of Good X if we see income increase and all other factors stay constant? O $6 and 8 units O $10 and 8 units $6 and 4 units O $10 and 2 units O $10 and 4 units Question 12 0.16 pts According to the law of demand,...
Question 16 1 pts Quantity Demanded Price Quantity Supplied per month 700 per Pizza per month...
Question 16 1 pts Quantity Demanded Price Quantity Supplied per month 700 per Pizza per month 100 600 300 500 500 400 300 900 The accompanying table shows the demand and supply of pizza at Tarantino's local pizza joint. If the price of pizza is $10, there is: surplus of pizzas and the price will fall as the market moves to equilibrium. shortage of pizzas and the price will fall as the market moves to equilibrium shortage of pizzas and...
(8 Points) California decides to introduce a tax on the sale of marijuana. Assume the elasticity...
(8 Points) California decides to introduce a tax on the sale of marijuana. Assume the elasticity of demand is -0.5, and that supply is perfectly elastic. a) If the tax increases the price of marijuana by 100%, what will happen to the amount that is sold? b) Suppose marijuana is addictive, and that consumers who choose to buy it are rational addicts. Explain what the theory of rational addition predicts will happen to the quantity sold today if the tax...
$o and 4 units D $10 and 8 units D Question 36 2 pts When supply...
$o and 4 units D $10 and 8 units D Question 36 2 pts When supply shifts left and demand shifts right. 0 the equilibrium quantity always rises. 0 the equilibrium price always rises. O the equilibrium quantity always falls. O the equilibrium price is indeterminate O the equilibrium price always falls. 2 pts Question 37
please answer Question 4 2.6 pts Assuming Demand is downward sloping and Supply is upward sloping...
please answer
Question 4 2.6 pts Assuming Demand is downward sloping and Supply is upward sloping (as we usually do), what happens to equilibrium price (P) and quantity (Q) of a good when Demand decreases? P and Q should not change P increases; Q increases P increases; Q decreases. P decreases, decreases. P decreases; Q increases. Question 5 2.6 pts Suppose that the supply of Blu Ray players decreases (i.e., shifts to the left). Using our standard supply and demand...
Question 10 3 pts If the government enacts a $8 price floor in this market, how...
Question 10 3 pts If the government enacts a $8 price floor in this market, how many units are sold? Price (5) 10 S 5 5000 Quantity Next Previous
It had no effect on consumers or firms in this situation. O It increased the incentive of individuals to supply the good on the black market. Question 7 2 pts A nonbinding price floor has which of the following consequences? O There will be downward pressure on prices until quantity demanded equals quantity supplied. O There will be upward pressure on prices until quantity demanded equals quantity supplied. O There are no consequences to a nonbinding price floor. The quantity...
O The price and quantity will not change in the legal market There will be inereased pressure to buy and sell the goods on the black market. Question2 2 pts Why does a shortage that occurs under a binding price ceiling increase over time? O Demand and supply both become more elastic. ® Demand and supply both become more inelastic O Demand becomes more elastic, but supply becomes more inelastic. 2 pts DQuestion 3
Question 3 1 pts Aaron's Angela's Austin's Alyssa's Price Quantity Quantity Quantity Quantity Demanded Demanded Demanded Demanded $0.00 20 16 4 $0.50 18 12 $1.00 14 10 2 $1.50 12 8 4 $2.00 6 $2.50 0 4 0 Whose demand does not obey the law of demand? O Alyssa's O Austin's O Aaron's O Angela's
Question 11 0.16 pts If the price and quantity for an inferior good, Good X, is $8 and 6 units at the original equilibrium, what is one possibility for the new equilibrium of Good X if we see income increase and all other factors stay constant? O $6 and 8 units O $10 and 8 units $6 and 4 units O $10 and 2 units O $10 and 4 units Question 12 0.16 pts According to the law of demand,...
Question 16 1 pts Quantity Demanded Price Quantity Supplied per month 700 per Pizza per month 100 600 300 500 500 400 300 900 The accompanying table shows the demand and supply of pizza at Tarantino's local pizza joint. If the price of pizza is $10, there is: surplus of pizzas and the price will fall as the market moves to equilibrium. shortage of pizzas and the price will fall as the market moves to equilibrium shortage of pizzas and...
(8 Points) California decides to introduce a tax on the sale of marijuana. Assume the elasticity of demand is -0.5, and that supply is perfectly elastic. a) If the tax increases the price of marijuana by 100%, what will happen to the amount that is sold? b) Suppose marijuana is addictive, and that consumers who choose to buy it are rational addicts. Explain what the theory of rational addition predicts will happen to the quantity sold today if the tax...
$o and 4 units D $10 and 8 units D Question 36 2 pts When supply shifts left and demand shifts right. 0 the equilibrium quantity always rises. 0 the equilibrium price always rises. O the equilibrium quantity always falls. O the equilibrium price is indeterminate O the equilibrium price always falls. 2 pts Question 37
please answer
Question 4 2.6 pts Assuming Demand is downward sloping and Supply is upward sloping (as we usually do), what happens to equilibrium price (P) and quantity (Q) of a good when Demand decreases? P and Q should not change P increases; Q increases P increases; Q decreases. P decreases, decreases. P decreases; Q increases. Question 5 2.6 pts Suppose that the supply of Blu Ray players decreases (i.e., shifts to the left). Using our standard supply and demand...
Question 10 3 pts If the government enacts a $8 price floor in this market, how many units are sold? Price (5) 10 S 5 5000 Quantity Next Previous
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