Reference no: EM13314680
1. If the market for a certain product experiences an increase in supply and a decrease in demand, which of the following results is expected to occur?
a. Both equilibrium price and the equilibrium quantity could rise or fall.
b. Equilibrium price would rise, and the equilibrium quantity could rise or fall.
c. Equilibrium price would fall, and the equilibrium quantity could rise or fall.
d. Equilibrium price would fall, and the equilibrium quantity would fall.
2. Suppose there are nine sellers and nine buyers, each willing to buy or sell one unit of a good, with values {$10, $9, $8, $7, $6, $5, $4, $3, $2}. Assuming no transactions costs and a competitive market, what is the equilibrium price in this market?
a. $5
b. $6
c. $7
d. $8
3. If the government imposes a price floor at $9 (i.e., price must be $9 or higher) in the above market, how many goods will be traded?
a. Five
b. Four
c. Three
d. Two
4. Suppose there is a single market maker in this market. What is the optimal bid–ask spread?
a. $2 bid; $10 ask
b. $4 bid; $8 ask
c. $5 bid; $7 ask
d. $6 bid; $6 ask
5. Now suppose that competition among several market makers forces the spread down to $2. How many goods are traded?
a. Five
b. Four
c. Three
d. Two
Consider an economy in which the labor market is competitive
: Assume that the price of the consumption good (denote it by P) is exogenously given and equal to 2. Use W to denote the hourly nominal wage in the economy
|
An increase in the real interest rate makes current
: If an agent is liquidity constrained, then an unexpected increase in transitory income of $100 can result in the agentís current consumption increasing by $100"
|
Affect the marginal product of any factor
: Suppose that the production function is given by Y = C + KaN1-a where C is a positive constant. Does an increase in C affect the marginal product of any factor? Will it affect labor productivity?
|
Over what range will changes in marginal cost have no effect
: Over what range will changes in marginal cost have no effect on CDW’s profit-maximizing level of output?
|
If the government imposes a price floor at
: If the government imposes a price floor at $9 (i.e., price must be $9 or higher) in the above market, how many goods will be traded?
|
An increase in the stock of capital of an economy
: Skill-biased technical change, through its effect on labor supply of skilled and unskilled workers, can generate an increase in wage inequality"
|
The company is producing too much
: Sal Pizza Shop has a unique recipe for pizza, and currently its optimal price is $20 per pizza at a quantity of 200 pizzas per week. Its marginal cost is $12 per pizza when it produces fewer than 180 pizzas per week. The marginal cost is $15 per pizz..
|
Was having that business open a sensible choice by theresa
: If a firm’s expansion path is a straight line starting on the origin, that implies that we have constant returns to scale (Hint – think of the Cobb-Douglas production function).
|
Ice cream and pie if these are goods that you like
: Ice cream and pie if these are goods that you like, but if you eat too much of either, you get sick of them. If you are sick of a good, eating more of it lowers you utility.
|