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Question: Multiple Choice Please choose the best response for each questi – Free Chegg Question Answer

Transcribed text From Image: Multiple Choice Please choose the best response for each question.(Each multiple choice question is worth 1.5 point 1. Consider the market for hotdogs. If the price of hotdog buns increases, what will happen price and a. Equilibrium price and equilibrium quantity will both increase b. Equilibrium price will increase and equilibrium quantity decrease c. Equilibrium price will decrease and equilibrium quantity will increase d. Equilibrium price and equilibrium quantity will both decrease Consider the market for electric cars. If the price of gasoline increases, what will happen to the equilibrium price and equilibrium quantity of electrics cars? 2. a. b. c. d. Equilibrium price and equilibrium quantity will both increase Equilibrium price will increase and equilibrium quantity decrease Equilibrium price will decrease and equilibrium quantity will increase Equilibrium price and equilibrium quantity will both decrease 3. If new reports come out that a new disease will likely adversely affect next year's peanut crop. (Consumers and firms can both easily store peanut butter.) How will the release of these reports affect today's equilibrium price and equilibrium quantity of peanut butter? The effect on equilibrium price and quantity will be ambiguous Equilibrium price will increase and the effect on equilibrium quantity will be ambiguous Equilibrium quantity will increase and the effect on equilibrium price will be ambiguous Equilibrium price and quantity will both decrease a. b. c. d. In a perfectly competitive market equilibrium, the height of the supply curve at the market equilibrium equals 4. a. the marginal cost to producers of producing the last unit of the good sold b. the total cost to producers of producing all units of the good sold c. the average cost to producers of producing the good d. the average benefit to producers of producing the good 5. If the equilibrium price and equilibrium quantity both increase in a particular market, which of the following could not have caused this change? a. The demand curve shifting right b. The demand curve shifting right and the supply curve shifting right c. The demand curve shifting left and the supply curve shifting right d. The demand curve shifting right and the supply curve shifting left

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1. b. Equilibrium price will increase and quantity decrease.
(As price of buns increase so producing hotdogs becomes expensive and thus supply of hotdogs decreases which increases equilibrium price and decreases quantity)

2. a. Equilibrium price and equilibrium quantity will both increase.
(As gasoline becomes expensive so demand for electric cars increases which increases both equilibrium price and quantity)

3. b. Equilibrium price will increase and the effect on equilibrium quantity will be ambiguous.
(Due to the news demand for peanut butter will increase and supply will decrease so equilibrium price will increase and the effect on equilibrium quantity will be ambiguous.)

4. a. the marginal cost to producers of producing the last unit of the good sold.
(Under perfect competition, supply equals marginal cost)

5. c. the demand curve shifting left and the supply curve shifting right.
(This will definitely cause equilibrium price to fall)


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