ECO204 Quizzes Week 2 Quiz

Question 1

What is price elasticity of supply?

the sum of supply plus demand

Correct!

the measure of the responsiveness of the quantity supplied to changes in the price

the measure of the responsiveness of the quantity supplied to changes in demand

the opposite of price inelasticity of demand

Question 2

Research by Luo and Song showed that, in rural China from 2003 to at least 2008, income elasticity of consumer demand for food was slightly less than 1, meaning that the overall growth rate of consumer demand for food was __________.

slightly more than the growth rate of income

much lower than the growth rate of income

much higher than the growth rate of income

Correct!

slightly less than the growth rate of income

Question 3

Which of the following is typically NOT a factor that influences price elasticity of demand?

the consumer’s income

Correct!

the product’s country of origin

available, acceptable substitutes

the necessity of purchase

Question 4

One major problem with utility theory is that __________.

not all consumers are affected by utility

it is based on numerous assumptions

Correct Answer

it is impossible to measure utility

it is difficult to survey consumers

Question 5

In the early days of economic discourse, a popular topic was “What determines value?” Which of the following economists wrote that value meant either “value in use” or “value in exchange”?

Carl Menger

Correct!

Adam Smith

Léon Walras

Alfred Marshall

Question 6

At the pie-eating contest, Mark thinks he might enjoy the fourth pie as much as the first pie. What is the term for a relationship that expresses a person’s desire to consume different amounts of a good or service?

marginal utility

total utility

Correct Answer

utility function

util

Question 7

What happened when—regardless of the market demand—the United Kingdom made laws to ban smoking in enclosed workplaces?

Restaurant and pub owners generally disregarded the law.

Restaurant and pub owners sued the UK’s Parliament.

Correct!

Respiratory illness declined sharply among workers.

Respiratory illness was monitored for the first time.

Question 8

Free riding is a market concern because free riders __________.

make it difficult for others to enjoy a public good

Correct Answer

make it difficult for the market to measure actual demand

might consume all of a public good

do not pay federal taxes

Question 9

In the term social marginal costs, to whom does social refer?

Correct!

society as a whole

only those who are affected but are not direct transaction participants

only direct transaction participants

society as a whole minus the direct transaction participants

Question 10

Economists use the distinction between private and public goods to determine __________.

who gets to decide specific aspects of government-funded projects

which entities deserve government funding and which do not

Correct!

what projects and activities should be undertaken by the government

how much private taxpayers will pay for public goods