ECON 528 Midterm || Correctly Solved!!
Managerial Economics correct answers Helps managers make decisions in the face of
scarcity.
Economic Costs of Production vs. Accounting Costs correct answers Economic costs add the
opportunity costs of a firm using its own resources while accounting costs do not.
Margie's Profit Maximization correct answers This cannot be determined without knowing
Margie's total or marginal production costs.
Short-Run Shutdown Point correct answers Identify the short-run shut down point for the
firm: b.
Sally's Business Operations correct answers In the first year, economic profit is -$1,000 and
accounting profit is $60,000.
Price Discrimination correct answers A firm that can effectively price discriminate will
charge a higher price to customers who have the more inelastic demand for the product.
Metropolitan Opera Ticket Pricing correct answers Third-degree price discrimination.
Pricing Strategy correct answers Second-degree price discrimination.
Substitute Products and Price Change correct answers If the Apple iPhone and the Samsung
Galaxy are considered substitutes, then, other things equal, an increase in the price of the
iPhone will increase the demand for the Galaxy.
Price Increase and Gasoline Demand correct answers If the price of automobiles was to
increase, then the demand for gasoline would decrease.
Studies on Calcium Consumption and Osteoporosis correct answers The calcium demand
curve shifts to the right because of a change in tastes in favor of calcium.
Impact of Grape Harvest Forecast on California Wine Market correct answers The demand
curve for California wine shifts to the right in anticipation of higher prices in the future.
Cross-Price Elasticity of Demand for Two Goods correct answers If the cross-price elasticity
of demand for two goods is 1.25, then the two goods are substitutes.
Income Elasticity of Demand Calculation correct answers If a 4 percent decrease in income
results in a 6 percent increase in the quantity demanded of a good, the income elasticity of
demand for the good is negative, and the good is an inferior good.
Arc Price Elasticity of Demand Calculation correct answers The arc price elasticity of
demand (midpoint formula) for gasoline from September 2011 to September 2012 was -0.76.
Understanding Price Elasticity of Demand correct answers Demand is more elastic in the
long run than it is in the short run.
Managerial Economics correct answers Helps managers make decisions in the face of
scarcity.
Economic Costs of Production vs. Accounting Costs correct answers Economic costs add the
opportunity costs of a firm using its own resources while accounting costs do not.
Margie's Profit Maximization correct answers This cannot be determined without knowing
Margie's total or marginal production costs.
Short-Run Shutdown Point correct answers Identify the short-run shut down point for the
firm: b.
Sally's Business Operations correct answers In the first year, economic profit is -$1,000 and
accounting profit is $60,000.
Price Discrimination correct answers A firm that can effectively price discriminate will
charge a higher price to customers who have the more inelastic demand for the product.
Metropolitan Opera Ticket Pricing correct answers Third-degree price discrimination.
Pricing Strategy correct answers Second-degree price discrimination.
Substitute Products and Price Change correct answers If the Apple iPhone and the Samsung
Galaxy are considered substitutes, then, other things equal, an increase in the price of the
iPhone will increase the demand for the Galaxy.
Price Increase and Gasoline Demand correct answers If the price of automobiles was to
increase, then the demand for gasoline would decrease.
Studies on Calcium Consumption and Osteoporosis correct answers The calcium demand
curve shifts to the right because of a change in tastes in favor of calcium.
Impact of Grape Harvest Forecast on California Wine Market correct answers The demand
curve for California wine shifts to the right in anticipation of higher prices in the future.
Cross-Price Elasticity of Demand for Two Goods correct answers If the cross-price elasticity
of demand for two goods is 1.25, then the two goods are substitutes.
Income Elasticity of Demand Calculation correct answers If a 4 percent decrease in income
results in a 6 percent increase in the quantity demanded of a good, the income elasticity of
demand for the good is negative, and the good is an inferior good.
Arc Price Elasticity of Demand Calculation correct answers The arc price elasticity of
demand (midpoint formula) for gasoline from September 2011 to September 2012 was -0.76.
Understanding Price Elasticity of Demand correct answers Demand is more elastic in the
long run than it is in the short run.
