Microeconomic Concepts Quiz: Supply, Demand, and Market Equilibrium Quiz 3

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Microeconomic Concepts Quiz: Supply, Demand, and Market Equilibrium Quiz 3 1. Which of the following is the most likely effect of higher chicken prices on the price and quantity purchased of beef, a substitute product? a. The price of beef will increase, and the quantity purchased will increase 2. In Figure 3 - 3, If the initial demand for margarine were D1, the impact of an increase in the price of margarine from $0.35 to $0.40 per pound on consumer purchases would be illustrated as a. 2 a shift in demand curve to D3 3. Which of the following events would decrease producer surplus? a. All of the above are correct 4. Andrew decides that he would pay as much as $3,000 for a new laptop computer. He buys the computer and realizes consumer surplus of $700. How much did Andrew pay for his computer? a. $2,300 5. How would a decrease in consumer income affect the market for new furniture? a. Demand would decrease, leading to a reduction in price and a reduction in quantity sold. 6. Ceteris paribus, an increase in the price of a good will cause the a. Producer surplus derived from the good to increase 7. If price falls, what happens to the quantity demanded for a product? a. It increases 8. Other things constant, an increase in consumer income will a. Shift the demand curve for automobiles to the right 9. How will an increase in lumber prices influence the home construction market? a. The supply of newly constructed homes will decrease 10. If the quantity of a good supplied is not very sensitive to the price of the good, this is illustrated by a a. Supply curve that is relatively steep (more vertical)
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