Question

11.

While an increase in the price of a substitute causes the _______ curve to shift _______ an increase in the price of a substitute in production causes the _______ curve to shift _______.

Group of answer choices

demand, right, supply, left

demand left, supply, right

demand, left, supply, left

demand, right, supply, right

12.

The general rule in marginal analysis is that an activity should continue as long as the marginal benefit is at least as large as the marginal cost.   

Group of answer choices

True

False

13.

Assume there is a decrease in the supply of Good X. Which of the following statements is correct?

Group of answer choices

You will know for certain what happens to the equilibrium quantity and the equilibrium price.

You will know for certain what happens to the equilibrium quantity, but there will be uncertainty regarding the equilibrium price.

You will not know anything for certain regarding the equilibrium quantity or equilibrium price.

You will know for certain what happens to the equilibrium price, but there will be uncertainty regarding the equilibrium quantity.

14.

Assume there is a simultaneous increase in the number of consumers, a decrease in income (assume an inferior good), and an expectation by consumers of a higher price. Which of the following statements is correct?

Group of answer choices

The equilibrium price will increase, and the equilibrium quantity will increase.

The equilibrium price will decrease, and the equilibrium quantity will increase.

More information is needed to answer this question.

The equilibrium price will decrease, and the equilibrium quantity will decrease.

The equilibrium price will increase, and the equilibrium quantity will decrease.

15.

A price ceiling causes the actual number of units of a good bought and sold to decrease compared to the equilibrium quantity. A price floor causes the actual number of units bought and sold to increase compared to the equilibrium quantity.

Group of answer choices

True

False

Answer 1

a) "A"

demand, right, supply, left, when price of substitue rise the demand curve will shift to the right but when price of substitue in production rises the supply curve will shift to the left.

b) True, at the point where the MR=MC the activity should stop.

c) "A"

the supply curve will shift to the left and the new equilibrium will be at a higher price and lower level of output.

d) All the factors willl shift the aggregate demand curve to the right and the new equilibrium will be at a higher price and higher level of output. The answer is "A".

e) False, both decrease the number of goods brought and sold in the market.