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AP Micro Supply & Demand Review Flashcards | StudBud

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What does a price ceiling do to consumer surplus?

The demand is perfectly inelastic & the supply is upward sloping. If the price of an input ↑...

AP Micro Supply & Demand Review

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Practice questions to help for the Supply & Demand unit.

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Questions 8

Answers

1
The demand is perfectly inelastic & the supply is upward sloping. If the price of an input ↑...
no change in quantity but an increase in the price
decrease in the quantity & an increase in the price
no change in quantity but a decrease in price
decrease in both the quantity and price of the good
2
What does a price ceiling do to consumer surplus?
makes it larger
has no impact on consumer surplus
makes it smaller
it only impacts producer surplus
3
The P of orange juice ↑ 20%, which caused a 10% ↑ in Q of apple juice. The cross elasticity is
- 2 complement
+ 0.5 substitute
+ 2 subsitute
+ 0.5 complement
4
Calculate the deadweight loss
$20,000
$10,000
$30,000
$15,000
5
After a $0.20 tax on gas, the price of gas increased from $1.00 to $1.15. What must be true?
Consumers bear the entire burden of the tax
Producers bear the entire burden of the tax
Consumers and producers share the tax burden equally
Consumers bear most, but not all of the tax burden
6
All of the following cause a rightward shift in the demand schedule for a normal good EXCEPT
an increase in consumers’ income
a decrease in the price of the good
a decrease in the price of a complementary good
an increase in consumers’ preference for the good
7
Which of the following will cause a change in the supply of personal computers (PC’s)?
Price of PC’s
Consumers’ incomes
Technology
Price of monitors, which are a complement to PC’s
8
A decrease in raw material prices will change equilibrium P & Q in which of the following ways?
P↓ Q↑
P↑ Q↓
P↓ Q↓
P↑ Q↑