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5 Written questions

5 Matching questions

  1. Because of "mental accounting:"
  2. The demand for autos is likely to be:
  3. Allocative efficiency is achieved when the production of a good occurs where:
  4. For a linear demand curve:
  5. If a firm can sell 3,000 units of product A at $10 per unit and 5,000 at $8, then:
  1. a people isolate purchases and sometimes make irrational decisions.
  2. b less price elastic than the demand for Honda Accords.
  3. c P = MC.
  4. d the price elasticity of demand is 2.25.
  5. e demand is elastic at high prices.

5 Multiple choice questions

  1. Alex's behavior is consistent with the endowment effect.
  2. increases the amount of health care consumed by reducing the price of additional units of care.
  3. utility.
  4. economic profits earned by firms already in the industry.
  5. change from being monopolistic to being competitive.

5 True/False questions

  1. The demand for a necessity whose cost is a small portion of one's total income is:relatively price inelastic.


  2. Anchoringcan influence decision-making with irrelevant information.


  3. If the demand for farm products is price inelastic, a good harvest will cause farm revenues to:decrease


  4. Under what conditions would an increase in demand lead to a lower long-run equilibrium price?The firms in the market are part of a decreasing-cost industry.


  5. The price elasticity of demand coefficient measures:buyer responsiveness to price changes.