When a demand curve is expressed in log-linear form, such as log(Q) = a - b log(P) + b2 log(P2) + c log(I), the coefficients of the demand determinants correspond to:
A. changes in determinants other than price.
B. the parameters that may fluctuate in value.
C. the independent variables in the model.
D. the elasticity values of those determinants.
D. the elasticity values of those determinants.
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The price of a shirt is $20. Charlie can produce a shirt at a marginal cost of $10, Mac can produce a shirt for $18, and Dennis can produce a shirt for $22
For a shirt, Deandra has a marginal benefit of $25, Frank has marginal benefit of $20, and Artemis has a marginal benefit of $18. Which of the following statements is correct? A) The sum of consumer surplus is $5 and the sum of producer surplus is $12. B) The sum of consumer surplus is $12. C) Only Frank and Artemis will purchase a shirt. D) Only Dennis will produce a shirt. E) The sum of producer surplus is $10.
If an indifference curve is a straight line it will not show which of the following?
A) any marginal rate of substitution B) diminishing marginal rate of substitution C) combinations of goods among which a consumer is indifferent D) None of the above answers is correct.
Assume there is a shortage in the market for digital music players. Which of the following statements correctly describes this situation?
A) The shortage will cause a decrease in the equilibrium price of digital music players. B) The demand for digital music players is greater than the supply of digital music players. C) Some consumers will be unable to obtain digital music players at the market price and will have an incentive to offer to buy the product at a higher price. D) The price of digital music players will rise in response to the shortage; as the price rises the quantity demanded will increase and the quantity supplied will decrease.
The table below shows the units of land and labor required to produce a unit of bread and cheese respectively in Country X. If Country X is land-abundant, the opening up of free trade would result in 1 Unit of Bread1 Unit of CheeseLabor Input5 units20 unitsLand Input4 units10 units
A. a decline in the production of bread but an increase in the production of cheese in the country. B. an increase in the production of both bread and cheese in the country, but production of cheese will rise at a lesser pace than the production of bread. C. a decline in the production of both bread and cheese in the country. D. an increase in the production of bread but a decline in the production of cheese in the country.