What is the definition of microeconomics?

In terms of net benefit, what is the effect of an increase in the tastes and preferences for landline phones on the decision to purchase a landline phone?

An example of a marginal decision is whether to move to New York City or not.

Consider the principles of economics. Which of the following can be inferred from one of these principles of economics?

For the Circular Flow Model, who supplies the outputs?

The Circular Flow Model’s purpose is to show how a country's government and banks interact with each other.

Which of the following is an example of a normative statement about microeconomics?

Asking if it is supply or demand that determines the price is like asking which blade of a scissor cuts paper. It is both.

What is the definition of the demand curve?

Consider the market for dialysis services in the US. A current trend is for patients requiring these services to live longer so more people need these services. What is the effect of this trend on this market’s equilibrium price and quantity?

Consider the market for gas in the US. Suppose the price of gas drops. What happens to the demand for gas?

Consider the market for primary medical care – e.g., recognizing the early symptoms of a major disease. We know that primary care doctors receive much less pay than specialists, and the pay for primary care doctors is not likely to rise anytime soon. For the market for primary care, what do you think is a possible result?

Recall our discussion of the video game console market where tastes and preferences are moving away from the consoles to mobile devices and where the cost (of the computing chips needed for the consoles) has been increasing. Which of the following is true regarding what happened to the video game console industry in the past few years?

What is a price ceiling?

Consider the market for agricultural products like corn where there is a minimum price determined by the government. In this market, what type of government policy applies?

We have the following table for humidifiers: Price Quantity supplied Quantity demanded $200 3,500 0 $175 3,000 0 $150 2,500 500 $125 2,000 1,000 $100 1,500 1,500 $75 1,000 2,000 $50 500 2,500 $25 0 3,000 $0 0 3,500 What is the equilibrium price?

What is an example of a price ceiling?

What is the effect of a tax?

Suppose the tax per unit falls. From what you learned in this class, what would be the effect on the tax revenue?

What is the general definition of the PES?

Consider the market for American cereals (e.g., Cheerios). Due to a reduction in trade, there are fewer cereals produced abroad that are available to American consumers. What do you think would be the effect of this decline in cereal choices from other countries on the PED for American cereals?

Suppose a good has a PED of -2. What can be inferred from this number?

Consider a tax on a good known as Ervands. If the tax is changed from being on the sellers to being on the buyers, what is the effect on the tax burden?

Suppose this good’s supply became more inelastic. What effect would this change have on the effect of a tax applied on this market?

Suppose for a good known as "Kasyans" that the PED is -0.70 and the PES is 2.65. If a tax was applied in this market, what could we say about the tax burden?

Recall the market for cosmetics whose IED<0. If the economy goes through a recession (when incomes fall), what would happen to the equilibrium price and quantity of cosmetics?

Consider legal marijuana and illegal marijuana. Suppose a study is undertaken and finds the CPED is greater than zero. This study’s finding means these two goods are...

Consider the following goods: milk and cereal. Milk is of course used with cereal. Which of the following is likely true about the CPED of these two goods?

What is the definition of behavioral economics?

Think about the following situation. Suppose you and your friend are about to take a final exam. Nervous about the test, you ask him what she believes is her probability of passing the class. She says the following: “I’m not worried. My intelligence, study habits and study time are all far above the average student.” This statement may be an example of what cognitive bias?

Wednesday nights. Often times, these nights are characterized by students being stressed out because they are cramming to finish an assignment due on Thursday. What bias might explain this cramming?

Suppose your friend is trying to make money selling iPhone cases she designed. She tries selling them online for $15 per case. People do not buy it because they say the cases are too expensive. She then includes the words “Valentine’s Day Sale” and also includes a price of $25 crossed out to make it look like the price has been marked down to $15. People then rush to buy her cases. What cognitive bias might be relevant here?

According to what was said in class, which of the following is true concerning Behavioral Economics?

An example of Behavioral Economics is at the supermarket when people buy more of a good because the supermarket lowers the good’s price.

Suppose AVC=$20, FC=$900 and TC=$2,500. What is the ATC?

Consider the following information. Suppose FC=$11,300. Further suppose that when q=9 then AVC=$1,500 and when q=10 then ATC=$2,500. What is MC for the 10th unit?

Consider the following information. Suppose FC=$11,300. Further suppose that when q=9 then AVC=$1,500 and when q=10 then ATC=$2,500. If the firm decides to make 10 units (q=10), what is the MR at q=10?

Suppose a company called Nareg V. Inc. is selling a product known as “Mikhael’s Giant Birthday Candles”. The company has the following table: q P TR TC Profit MR MC ∆Profit 0 25 5 --- --- --- 1 25 10 2 25 30 3 25 10 4 25 20 5 25 80 What is the quantity produced?

Suppose we have a market where there are 100 firms and the economic profit to each firm is $10,000. If the market is competitive, what we do know will happen in the long run?

Suppose a firm in the competitive market faces the following cost and revenue conditions: ATC=$20; AVC=$15; MC=$20; MR=$25. The firm should…

A firm in a competitive market has a constant and positive marginal revenue. So, the more a competitive firm makes, the higher its profits.

Suppose we have the following information for a firm in the competitive market: P=$130; q=100; TC=$11,000 for q=0; AVC=$10 for q=100; Which of the following is true for q=100?

Consider a firm in the competitive market. No matter whether the market’s demand curve shifts left or right, we know in the long run its economic profit will be 0.

According to this course, which of the following does NOT tend to characterize a monopoly? 

Which of the following is true concerning the Prize Linked Savings Accounts (PLSAs)?

Which of the following equations will definitely apply for a monopoly in the long run?

Consider a good known as Siras. Suppose the number of buyers increases while the number of sellers also increases. What is the effect on the price?

Suppose a competitive firm for hardwood floors is at a point where profits are zero. Suddenly, there is an increase in tastes and preferences for these floors. In the long run, what happens to the P and Q?

For the previous problem, what happens to the firm’s profit in the long run (relative to what profit was before the change in tastes and preferences)?

Suppose the company Intel is making positive profits initially. It has a monopoly on microprocessors – what are used as the brain for a desktop and laptop. Due to rise of smart phones and tablets, tastes and preferences for microprocessors has been decreasing. In the short run, what happens to the P and q?

Suppose the company Intel is making positive profits initially. It has a monopoly on microprocessors – what are used as the brain for a desktop and laptop. Due to rise of smart phones and tablets, tastes and preferences for microprocessors has been decreasing. In the long run, what happens to the P and q?