Beef, pork and chicken are all substitutes for consumers. If the price of beef i
ID: 1132369 • Letter: B
Question
Beef, pork and chicken are all substitutes for consumers. If the price of beef increases, then which of the following outcomes results?
a. The demand for pork will decrease.
b. The quantity demanded of beef with increase.
c. The demand for beef will drop dramatically .
d. The demand for chicken will increase.
Which of the following occurs when the government imposes a price floor on a product that is above the equilibrium price?
a. A surplus, which can be resolved by allowing the market price to fall until it reaches a value where the quantity demanded is just equal to the quantity supplied
b. A shortage, which can be resolved by allowing the market price to fall until it reaches a value where the quantity demanded is just equal to the quantity supplied.
c. Market equilibrium.
d. Quantity demanded at the price floor just equals the quantity supplied at the price floor.
Which of the following changes would cause the supply curve for Good A to shift to the right, so that all quantities supplied would increase at every possible market price?
a. An increase in the price of inputs used to make Good A.
b. A decrease in the number of sellers of Good A.
c. An increase in the price of Good B, which producers of Good A can make with the same equipment they are using to make Good A.
d. Lower production costs of making Good A from the adoption of a significant technological advance.
Which of the following is NOT a determinant of inelastic demand?
a.
The good comprises a small portion of the consumers budget (salt, toothpicks)
b.
The good has few acceptable substitutes.
c.
The good is a luxury.
d.
The good is viewed as a necessity, such as health care or gasoline.
a.
The good comprises a small portion of the consumers budget (salt, toothpicks)
b.
The good has few acceptable substitutes.
c.
The good is a luxury.
d.
The good is viewed as a necessity, such as health care or gasoline.
Explanation / Answer
1. If price of beef increases, consumers will buy less beef and will demand more of it's substitutes that is pork, chicken. Therefore, demand for pork and chicken will increase.
Answer-option D
2. If government imposes a price floor on a product and above it's equilibrium price, then at price floor, quantity supplied will exceed the quantity demanded causing a surplus. This can be solved by allowing the market price to fall to the equilibrium where quantity demanded is equal to quantity supplied.
Answer-option A
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.