ECO 204 Week 1 Quiz

In this paperwork of ECO 204 Week 1 Quiz you will find the answers on the next questions:

1. For perfectly price inelastic supply

supply determines price solely.

demand determines price solely.

only a government can set the price.

either supply or demand may set the price.

2. For Matthew, the marginal utility of the 9th soda in a day is positive and the marginal utility of the 10th soda in a day is zero. This

implies that Matthew's demand curve for sodas per day will become upward sloping at 10 sodas per day.

is impossible because each additional unit of consumption of any good must provide positive marginal utility.

implies that at a zero price Matthew's demand curve will intersect the quantity axis at 10.

implies that Matthew maximizes utility by consuming 9 sodas per day.

3. Jane has $500 a Week to spend on clothing and food. The price of clothing is $25 and the price of food is $10. Jane spends her entire income when she purchases ________ units of clothing and ________ units of food.

10; 10

25; 5

12; 20

16; 8

4.Michael Dell was the first individual who sold computers by mail order. The company founded by Dell is now one of the largest and most successful computer companies in the United States. Michael Dell would be classified as a(n)

entrepreneur.

opportunist.

monopolist.

socialist.

5. Demand determines price entirely when

demand is downward sloping.

demand is perfectly inelastic.

supply is perfectly inelastic.

supply is perfectly elastic.

6. As an individual consumes more of a product within a given period of time, it is likely that each additional unit consumed will yield

successively less satisfaction.

successively more satisfaction.

the same amount of satisfaction.

less satisfaction for a while and then start to add more satisfaction.

7. When there are more substitutes for a product, the ________ for the product is ________.

demand; less price elastic

demand; more price elastic

income elasticity; greater

income elasticity; smaller

8. A price change would have the largest income effect on a

magazine.

desktop computer.

piece of clothing.

car.

9. If the demand for sardines increases as income decreases, sardines are a(n)

normal good.

inferior good.

substitute good.

complementary good.

10. Jane has $500 a Week to spend on clothing and food. The price of clothing is $25 and the price of food is $10. The clothing and food pairs in Jane's choice set include ________ units of clothing and ________ units of food.

50; 50

20; 50

15; 25

8; 30