Question

6. If technology improves in producing computers, what will happen to the equilibrium price andquantity of computers? Both the equilibrium price and quantity will increase. Both the equilibrium price and quantity will decrease. The equilibrium price will increase and the equilibrium quantity will decrease. the equilibrium price will decrease and the equilibrium quantity will increase 7. Producer surplus is the area: Above the supply curve and below the price Below the supply curve and above the price . Above the demand curve and below the price Below the demand curve and above the price . Below the demand curve and above the supply curve a If when a firm decides to raise the price of its product by 89, it loses half of its customers, then the price elasticity of demand is: 1.25 -6.25 0.5 9. In measuring the sensitivity of demand, the price and income elasticities refer to movements along the demand curve; other elasticities b refer to shifts of the entire demand curve price elasticity refers to movements along the demand curve; income and cross-price elasticities refer to shifts of the entire demand curve a income and cross-price elasticities refer to movements along the demand curve; price clasticityrefers to shifts of the entire demand curve e price and cross-price elasticities analyze movements along the demand curve; other elasticities refer to shifts of the entire demand curve in the price of a restaurant meal results in a drop in quantity demanded of 5 meals. Which of the following statements is correct? a the slope of the demand curve is ; there is insufficient information to determine the the price elasticity of demand is 1/5; there is insufficient information to determine the slope ofthe demand curve e both the slope of the demand curve and the price elasticity of demand are equal to-1/5 4 there is insufficient information to determine either the slope of the demand curve or the priceelasticity of demand the slope of the demand curve is -1/S; the price

Answer 1

6. Answer: option D7. Producers surplus is the area below price and above the supply curve.

e SUPpu S 1 c-e P2

Answer: option A