Eco 2023 Final Exam Questions and All
Correct Answers 2026-2027 Updated.
a combination of goods on a given PPF is - Answer Both obtainable and Efficient
For a normal good, if INCOME goes UP, what happens to supply? Demand? - Answer Demand
shifts right and the supply remains unchanged
For an inferior good, if INCOME goes UP, what happens to supply? Demand? - Answer Demand
shifts left and the supply remains unchanged
bananas and oranges are perfect substitutes. If the PRICE of bananas goes UP, what happens to
the demand for oranges? the Supply curve? - Answer demand shifts right and supply remains
unchanged
peanut butter and jelly are complements. If the PRICE of peanut butter goes UP, what happens
to the demand curve for jelly? the supply curve? - Answer demand shifts left. Supply remains
unchanged
if technology used in corn production increases, what happens to the supply curve for corn? the
demand curve? - Answer shifts the supply curve right. the demand curve remains unchanged
show an equilibrium price and quantity on a supply and demand curve - Answer where the
demand and supply curve intersect
when the price is above equilibrium price, a ________ results. - Answer surplus
when the price is below equilibrium price, a __________ results - Answer shortage
if the supply curve shifts to the right and the demand curve remains the same, what happens to
price and quantity - Answer the price will fall and the quantity will increase
if the supply curve shifts to the left and the demand curve remains the same, what happens to
price and quantity - Answer the price will rise and the quantity demanded will decrease
if the demand curve shifts to the right and the supply curve remains the same what happens to
price and quantity - Answer price will rise and the quantity will increase
, if the demand curve shifts to the left and the supply curve remains the same what happens to
price and quantity - Answer price will fall and the quantity will decrease
is the elasticity of demand for a given curve the same at all points - Answer no. the elasticity
varies along a given demand curve
as you move up and to the left along a demand curve, what happens to point elasticity - Answer
it increases
what determines whether a good's demand is elastic or not - Answer the substitutability of
the good
if your at a point where elasticity is equal to 1.2 and you raise prices, what will to total revenue?
- Answer total revenue will decrease
if your at a point where elasticity is equal to .4 and you raise prices, what will happen to total
revenue - Answer total revenue will increase
if income elasticity of demand (E(Y)) is negative then the good is a(n) ___________ good -
Answer inferior
if income elasticity of demand (E(Y)) is positive then the good is a(n) ___________ good -
Answer normal
if cross price elasticity of demand (E(C)) is positive then the two goods in question are
______________. - Answer substitutes
if the cross price elasticity of demand (E(C)) is negative, the the two goods in question are
______________. - Answer complements
does society, on the whole, win or lose from a monopoly - Answer lose, only the monopolist
himself wins from a monopoly situation. a monopoly causes deadweight loss, and thus
monopolies are on the whole bad for society
true or false: in the short-run, it is possible for a monopoly to earn an economic profit, but in
the long-run, all monopolies can make is a normal profit. - Answer false because there a
significant barriers to entry, a monopoly can earn an economic profit indefinitely
describe the conditions necessary for economic profit, normal profit, and economic loss in a
monopoly situation. - Answer if P>ATC, a firm earns an economic profit
Correct Answers 2026-2027 Updated.
a combination of goods on a given PPF is - Answer Both obtainable and Efficient
For a normal good, if INCOME goes UP, what happens to supply? Demand? - Answer Demand
shifts right and the supply remains unchanged
For an inferior good, if INCOME goes UP, what happens to supply? Demand? - Answer Demand
shifts left and the supply remains unchanged
bananas and oranges are perfect substitutes. If the PRICE of bananas goes UP, what happens to
the demand for oranges? the Supply curve? - Answer demand shifts right and supply remains
unchanged
peanut butter and jelly are complements. If the PRICE of peanut butter goes UP, what happens
to the demand curve for jelly? the supply curve? - Answer demand shifts left. Supply remains
unchanged
if technology used in corn production increases, what happens to the supply curve for corn? the
demand curve? - Answer shifts the supply curve right. the demand curve remains unchanged
show an equilibrium price and quantity on a supply and demand curve - Answer where the
demand and supply curve intersect
when the price is above equilibrium price, a ________ results. - Answer surplus
when the price is below equilibrium price, a __________ results - Answer shortage
if the supply curve shifts to the right and the demand curve remains the same, what happens to
price and quantity - Answer the price will fall and the quantity will increase
if the supply curve shifts to the left and the demand curve remains the same, what happens to
price and quantity - Answer the price will rise and the quantity demanded will decrease
if the demand curve shifts to the right and the supply curve remains the same what happens to
price and quantity - Answer price will rise and the quantity will increase
, if the demand curve shifts to the left and the supply curve remains the same what happens to
price and quantity - Answer price will fall and the quantity will decrease
is the elasticity of demand for a given curve the same at all points - Answer no. the elasticity
varies along a given demand curve
as you move up and to the left along a demand curve, what happens to point elasticity - Answer
it increases
what determines whether a good's demand is elastic or not - Answer the substitutability of
the good
if your at a point where elasticity is equal to 1.2 and you raise prices, what will to total revenue?
- Answer total revenue will decrease
if your at a point where elasticity is equal to .4 and you raise prices, what will happen to total
revenue - Answer total revenue will increase
if income elasticity of demand (E(Y)) is negative then the good is a(n) ___________ good -
Answer inferior
if income elasticity of demand (E(Y)) is positive then the good is a(n) ___________ good -
Answer normal
if cross price elasticity of demand (E(C)) is positive then the two goods in question are
______________. - Answer substitutes
if the cross price elasticity of demand (E(C)) is negative, the the two goods in question are
______________. - Answer complements
does society, on the whole, win or lose from a monopoly - Answer lose, only the monopolist
himself wins from a monopoly situation. a monopoly causes deadweight loss, and thus
monopolies are on the whole bad for society
true or false: in the short-run, it is possible for a monopoly to earn an economic profit, but in
the long-run, all monopolies can make is a normal profit. - Answer false because there a
significant barriers to entry, a monopoly can earn an economic profit indefinitely
describe the conditions necessary for economic profit, normal profit, and economic loss in a
monopoly situation. - Answer if P>ATC, a firm earns an economic profit
