Question

A-TRUE/FALSE-....1-. The quantity demanded is the quantity that consumers are willing and able to purchase at a given price. 2- A vertical reading of the demand curve gives the maximum price per unit that consumers are willing to pay for a particular quantity of a good. 3- There are more substitutes for oil as a jet fuel than for oil as a lubricant. 4-. An increase in income increases the demand for normal goods. 5-. Producer surplus can be defined as the revenue producers make from selling goods in a market. 6- A decrease in the cost of inputs will shift the supply curve down and to the right. 7-. A tax of $4 shifts the supply curve down and to the right by $4. 8-. The price of professional sports tickets is high; therefore, you should blame the owners for taking advantage of the fans, not the other buyers for outbidding you. 9-. When a shortage occurs, the market price increases. 10- In a competitive market, sellers compete with other sellers. 11-. In a free market equilibrium, the gains from trade are always greater for consumers than for producers. 12- When the demand curve shifts, equilibrium price and quantity exchanged move in opposite directions. 13- Lead, an input in the production of ammunition, increased in price from $0.60/lb in 2006 to over $1.50/lb in 2007. A possible explanation for this is that demand has increased faster than supply has increased. 14- An increase in the price of granite would result in a decrease in the DEMAND for granite countertops. 15- The elasticity of demand for cigarettes is more inelastic in the long run than in the short run because it takes a long time for some people to quit smoking. 16-. The demand for oil would become less elastic if the price of oil increases by significant amount for a long period of time. 17-. When demand is inelastic, total revenue goes down in proportion to a price increase. 18- Elasticity of demand is always negative. 19-. If the price of a good increases from $100 to $110 and quantity demanded decreases from 100 units to 90 units, the demand would be classified as unit elastic. 20- The elasticity of supply measures how sensitive the supply curve is to a change in price.

Answer 1

1. True

the amount of a good or service that a consumer is willing and able to purchase at a specific price is the qunatity demanded.

2. True

Vertical reading of the demand curve is the maximum price people are willing to pay to buy a certain amount of the product.

3. True

There are 5 more substantial alternative jet fuels for.oil than as lubricant.

4. True

A good for which demand increases when income increases and falls when income decreases but price remains constant