If the price of the good described in Exhibit 4-1 is $1.60, then an economist would expect the
a. price to decrease to $1.40
b. price to decrease to $1.50
c. quantity supplied to increase to 50 units
d. quantity demanded to increase to 80 units
e. quantity demanded to increase to 90 units
B
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Economists use models in order to
A. experiment with alternative circumstances. B. make educated guesses about real-life events. C. predict outcomes under various hypothetical conditions. D. increase understanding of how a relationship actually works. E. All of these responses are correct.
In the above figure, if the milk industry is perfectly competitive, then the firm's marginal revenue curve is represented by
A) curve F. B) curve G. C) curve H. D) curve I.
Suppose the market supply curve is p = 5 + Q. If price increases from 10 to 15, the change in producer surplus is
A) 12.5. B) 5. C) 50. D) 37.5.
Which of the following is the formula for average revenue?
a. AR = TR - q b. AR = TR ÷ q c. AR = TR + q d. AR = TR × q