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Homework answers / question archive / Data Tour * Question Completion Status: TV omist A
Data Tour * Question Completion Status: TV omist A. A PPF with constant or decreasing opportunity cost "There is no such thing as a free lunch." B. A PPF with increasing opportunity cost V Although increased government investments in C. A normative microeconomics statement infrastructure saved or created 1.1 million jobs in construction industry and 400,000 jobs in D. Perfectly elastic demand manufacturing by March 2011, the U.S. unemployment rate for the month was still Equilibrium price for the item can increase, decrease, E. or remain the same. 8.8% F. A positive macroeconomics statement. A downward sloping curve that is bowed outward G. The Law of Diminishing Marginal Utility Represents a situation where it is possible to H. The Budget Constraint shifts inward v increase production in one area without reducing 1. The Budget Constraint line rotates clockwise in another Each time a choice is made opportunity costs are If Hurricane Harvey reduces both demand and J. incurred. supply of natural gas K. Negative marginal utility The difference between the maximum price a v person is willing and able to pay and the actual L. A situation of no-exchange. Save All Answers V it to save and submit. Click Save All Answers to save all answers.
to on in one area without reducing in another H. The Budget Constraint shifts inward 1. The Buget Constraint line rotates clockwise If Hurricane Harvey reduces both demand and J. Each time a choice is made opportunity costs are incurred. supply of natural gas K. Negative marginal utility The difference between the maximum price a person is willing and able to pay and the actual L. A situation of no-exchange. price he/she paid M. Increase price to raise revenue Price elasticity of demand for good X is 2.5 N. Productive inefficient - A small increase in price of a good reduces quantity demanded to zero 0. Equilibrium price for the item will necessarily increase P. consumer's surplus Total utility declines as the quantity consumed of a good increases Q. Decrease price to raise revenue Income declines R. A society that produces at a point above its PPF. S. Perfectly inelastic demand Sau Save All Answers uumit Click Save All Answers to save all answers.
Solution:
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3. A downward sloping curve that is bowed outward in economics is generally a usual well defined production possibility frontiier, which has increasing opportunity cost. Thus, the correct option is (B).
4. In a situation, if it is possible to increase production in an area without decrease in any other area, it means that all resources are yet not utilized fully. In this sense, it marks currently for inefficient productive situation. Thus, the correct option is (N).
5. If Hurricane Harvey reduces both demand and supply of natural gas, the equilibrium quantity of natural gas would surely decrease. However, the change in price depends on the extent of shift in each of the curves (or magnitude of reduction in demand and supply), thus, equilibrium price may increase, decrease, or stay the same. Thus, the correct option is (E).
6. The difference between a consumer's maximum willingness to pay and price actually paid by him/her is known as consumer surplus. Thus, the correct option is (P).
7. Price elasticity of demand for good X is 2.5, that is elastic demand. So, if price is increased, the quantity demanded will decrease by a higher percentage, implying an overall reduction in total revenue. In other words, in case of elastic demand, price and total revenue are negatively related. Thus, the correct option is (Q).
8. Price elasticity of demand = percentage change in quantity demanded/percentage change in price. So, if a slight increase in price of a good decreases quantity demanded to 0, it means price elasticity of demand is very high, or perfectly elastic demand. Thus, the correct option is (D).
9. The law of diminishing marginal utility states that as the consumption is increased, additional utility derived decreases. But if total utility decreases with increase in consumption, it means not just that additional utility is decreased, but rather that it is negative. Thus, the correct option is (K).
10. If income declines, it means that a consumer has lower budles to choose from as now he/she can incur lower expenditure due to lower affordability. As a result, the budget constraint decreases of shift inwards. Thus, the correct option is (H).
