Question 1

Steak and steak sauce are:

Accepted Answer

Steak and steak sauce are often consumed together and enhance the overall flavor experience, indicating that they are complements in consumption.

Question 2

Hamburgers and buns have a cross-price elasticity of demand that is:

Accepted Answer

Hamburgers and buns are complementary goods, meaning that an increase in the price of one leads to a decrease in the demand for the other, resulting in a negative cross-price elasticity of demand.

Question 3

White wheat and whole wheat bread are:

Accepted Answer

White wheat and whole wheat bread are substitutes in consumption because they are both types of bread that can be used interchangeably for the same purpose. When the price of one increases, consumers may switch to the other as a cheaper alternative.

Question 4

if the price of beef increases, then there is a:

Accepted Answer

An increase in the price of beef would lead to a decrease in the quantity demanded, represented by a downward movement along the demand curve, not a shift of the curve itself.

Question 5

If income increases, then there is a:

Accepted Answer

An increase in income causes an upward shift in beef demand. This is because as income increases, consumers will have more money to spend, leading to them purchasing more beef at every price and shifting the demand curve to the right.

Question 6

If the price of beef increases, then there is a:

Accepted Answer

If the price of beef increases, consumers may switch to pork as a substitute, leading to an increase in pork demand. This is represented by a rightward (upward) shift in the pork demand curve, not just a movement along the curve.

Question 7

If the price of beef increases, then there is a:

Accepted Answer

When the price of beef increases, people are likely to buy less beef, which in turn decreases the demand for steak sauce (a complementary good), leading to a downward shift in the steak sauce demand curve.

Question 8

Why do we study supply and demand? Explain thoroughly and carefully.

Accepted Answer

The answer of Why do we study supply and demand?...

Question 9

Demand Curve. 
A. Define the term, "demand curve." 
B. What does the demand curve represent, intuitively? 
C. How is the market demand curve derived? 
D. List the determinants of demand. 
E. Carefully describe and explain the difference between the movement along and a shift in demand.

Accepted Answer

The answer of Demand Curve. 
A. Define the term, "demand...

Question 10

Suppose that the price of bread increases from usd 1/loaf to usd 2/loaf, resulting in the quantity demanded of bread to decrease from 200 loaves to 160 loaves. What is the arc elasticity of demand for bread? Is bread elastic or inelastic? Why?

Accepted Answer

The answer of Suppose that the price of bread increases...

Question 11

Demonstrate the best strategy for maximizing profits for the bread company.

Accepted Answer

The answer of Demonstrate the best strategy for maximizing profits...

Question 12

Demonstrate and explain what will happen to the demand for air tickets over time.

Accepted Answer

The answer of Demonstrate and explain what will happen to...

Question 13

Use a graph and an explanation to explain what has happened to the demand for grocery store coupons in the past four to five years. Be sure to include proper economic terminology, elasticity description, and graphs.

Accepted Answer

The answer of Use a graph and an explanation to...

Question 14

Use graphs to demonstrate the income elasticity of: A. Steaks, B. Hamburgers, and C. Ramen noodles. What is the economic significance of this for US agriculture? Explain.

Accepted Answer

The answer of Use graphs to demonstrate the income elasticity...

Question 15

Suppose that a beef producer came to you (an economic consultant) and asked for advice on where to sell natural and organic beef in the future. Use your knowledge of income elasticities to explain and demonstrate the best course of action. Be sure to include proper economic terminology, elasticity description, and graphs.

Accepted Answer

The answer of Suppose that a beef producer came to...

Question 16

A. What is the equation of the cross-price elasticity of demand of beef and pork? B. What is the sign of the cross-price elasticity of demand of beef and pork? Explain.

Accepted Answer

The answer of A. What is the equation of the...

Question 17

The large increase in US ethanol production has resulted in a large increase in the demand for corn. 
A. What is the cause of the "large increase in ethanol production"? Explain. 
B. Will increased ethanol production shift the demand curve of wheat in the US? Explain why or why not. (Hint: think about your answer to A. above… what happens to demand for feed grains?)

Accepted Answer

The answer of The large increase in US ethanol production...

Question 18

What impact will animal rights laws that cause producers to change their production practices have on the price and quantity of meat? Hint: be careful here… think about both demand and supply.

Accepted Answer

The answer of What impact will animal rights laws that...

Question 19

Own-Price Elasticity of Supply (E^s). Suppose that the price of pizza increases from P₀=usd 6/pizza to P₁=usd 10/pizza, resulting in an increase in pizzas produced from Q₀= 10 pizzas to Q₁= 12 pizzas. A. Calculate ε at the initial values of P and Q. B. Is pizza supply elastic or inelastic? Demonstrate and explain. C. Is the pizza firm in the immediate run, short run, or long run? Explain.

Accepted Answer

The answer of Own-Price Elasticity of Supply (E^s). Suppose that...

Question 20

Cross-Price Elasticity of Supply (E^sxy).. A. What is the formula and sign of the cross-price elasticity of supply of pizza and bread sticks? Note: assume that the bread sticks are made from left-over pizza dough. B. What is the formula and sign of the cross-price elasticity of supply of pepperoni pizza and cheese pizza?

Accepted Answer

The answer of Cross-Price Elasticity of Supply (E^sxy).. A. What...

Quiz 9: Demand

Steak and steak sauce are:

Hamburgers and buns have a cross-price elasticity of demand that is:

White wheat and whole wheat bread are:

if the price of beef increases, then there is a:

If income increases, then there is a:

If the price of beef increases, then there is a:

If the price of beef increases, then there is a:

Why do we study supply and demand? Explain thoroughly and carefully.

Demand Curve. A. Define the term, "demand curve." B. What does the demand curve represent, intuitively? C. How is the market demand curve derived? D. List the determinants of demand. E. Carefully describe and explain the difference between the movement along and a shift in demand.

Suppose that the price of bread increases from usd 1/loaf to usd 2/loaf, resulting in the quantity demanded of bread to decrease from 200 loaves to 160 loaves. What is the arc elasticity of demand for bread? Is bread elastic or inelastic? Why?

Demonstrate the best strategy for maximizing profits for the bread company.

Demonstrate and explain what will happen to the demand for air tickets over time.

Use a graph and an explanation to explain what has happened to the demand for grocery store coupons in the past four to five years. Be sure to include proper economic terminology, elasticity description, and graphs.

Use graphs to demonstrate the income elasticity of: A. Steaks, B. Hamburgers, and C. Ramen noodles. What is the economic significance of this for US agriculture? Explain.

A. What is the equation of the cross-price elasticity of demand of beef and pork? B. What is the sign of the cross-price elasticity of demand of beef and pork? Explain.

What impact will animal rights laws that cause producers to change their production practices have on the price and quantity of meat? Hint: be careful here… think about both demand and supply.