Question

5. Suppose that beef is a normal good and that people's incomes decrease. The same

In time, an excellent corn harvest reduces the cost of feeding steers. These changes

result in

a) An increase in the equilibrium amount of beef.

b) An increase in the equilibrium quantity of beef if the change in the demand curve

it is less than the change in the supply curve.

c) An increase in the equilibrium quantity of meat if the change in the demand curve is

greater than the change in the supply curve.

d) No change in the balance amount of beef.

D.R Instituto Tecnológico y de Estudios Superiores de Monterrey, México. two

1017 - Business economics

6. Which of the following statements is correct?

a) When demand and supply increase, quantity decreases and price can increase,

fall or stay the same.

b) When demand and supply increase, the price increases and the quantity can increase,

decrease or stay the same.

c) When demand and supply decrease, the quantity increases and the price can increase,

fall or stay the same.

d) When both demand and supply decrease, the quantity decreases and the price can

increase, fall or remain the same.

7. The price will increase and the equilibrium quantity could increase, decrease or remain the same when

a) The demand and supply of a good increase.

b) The demand for a good increases and its supply decreases.

c) The demand for a good decreases and the supply increases.

d) The demand and supply of a good decrease.

8. Correctly complete the following by selecting the only correct answer option.

Suppose flights to Paris are a normal good and people's incomes increase. The same

Over time, the price of jet fuel rises. The balance price of a flight to Paris

________ and the balance amount of flights to Paris ________.

a) it can rise, fall or not change; increases

b) falls; decreases

c) go up; increases

d) goes up; could increase, decrease or not change

9. Correctly complete the following by selecting the only correct answer option.

Suppose that, in the orange market, the demand and supply of oranges decrease in the same

quantity.

The equilibrium quantity ________ and the equilibrium price ________.

a) will decrease; will not change

b) will decrease; will fall

c) will remain the same; can go up or down

d) will remain the same; get on

10. What will happen to the equilibrium price and quantity of coffee if it is discovered that it helps

prevent colds and at the same time Brazil and Vietnam emerge in the global market as massive

coffee producers?

a) The price will fall and the effect on the quantity is uncertain.

b) The quantity will increase and the effect on the price is uncertain.

c) The quantity will decrease and the price will increase.

d) The quantity will increase and the price will remain unchanged.

Answer 1

5) Option "b" is correct i.e An increase in the equilibrium quantity of beef if the change in the demand curve it is less than the change in the supply curve.

due to income decreases in income income, demand shifts leftword and due to reduction in cost supply shifts right word. if demand shifts less then supply then quantity increases the erquilibrium quantity increases

6) Option "d" is correct i.e When both demand and supply decrease, the quantity decreases and the price can increase, fall or remain the same.

if both demand and supply decreases then quantity falls but if demand is fall more the supply than price falls , if demand is fall equal to the supply then price remains constant and if demand is fall less then supply thrn price increases

7)) Option " b" is correct i.e The demand for a good increases and its supply decreases.

in this case price increases but for quantity we say, if demand increse = supply decreases then quantity is same , if demand increases > supply decreases then quantity increases and if last demand increases < supply decreases then quantity falls

8) Option"d" is correct i.e goes up; could increase, decrease or not change

due to increase in income demand for flights increases and due to rise in fuel price supply of flights increases this cause overoll increase in price but for quantity if if demand increse = supply decreases then quantity is same , if demand increases > supply decreases then quantity increases and if last demand increases < supply decreases then quantity falls

9) Option"a" is correct i.e will decrease; will not change

due to decrease in both demand and supply by the same portion, this means quantity falls and price remain constant

10) Option "a" is correct i.e The price will fall and the effect on the quantity is uncertain.

due to massive production by both the countries price falls and demand is uncertain because demand is fixed and suply increases this increase in supply creates fall in pruce but demand is uncertain

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