.a decrease in equilibrium pricec.an increase in equilibrium quantityd.a decrease in equilibrium quantity Page 5 16.Refer to Figure 5.1. The market is initially in equilibrium at point B. If demand shifts from D2 to D1 and the price of chicken remains constant at $4.00, there will bea.an excess supply of 200 million pounds of chicken.b.an excess demand of 200 million pounds of chicken.c.an excess supply of 100 million pounds of chicken.d.an excess demand of 100 million pounds of chicken.17.Price is determined solely by demand whena.demand is perfectly elastic.b.demand is perfectly inelastic.c.supply is perfectly inelastic.d. supply is perfectly elastic.e. Both a. and c. Page 618.The government imposes a maximum price on apartments that is BELOW the equilibrium price. You accurately predict thata.the law will have no economic impact.b.the law will create a surplus of apartments.c.renters will find that landlords start offering to furnish the apartments.d.landlords are less likely to do routine maintenance work in the apartments.19.The Bill Branch Tool Company wants to increase the quantity of tools it sells by 10%. If the price elasticity of demand is -2.5 the company musta.decrease price by 4.0%.b.increase price by 4.0%.c.decrease price by.025%.d.increase price by.025%. Page 7 20.Refer to Figure 5.6. Using the midpoint formula, if the price of a hamburger is increased form $2 to $4, the price elasticity of demand equalsa.-3.b.-.33.c.-.15.d. -5.e. None of the above21.If total revenue increases after a price increase, demand isa.inelastic.b.unitarily elastic.c.perfectly elastic.d.elastic. Page 822.If the owner of an ice cream store charges a $1.20 for an ice cream cone his total revenue is $540 a day. If he lowers the price to $1.00 his total revenue is $500 a day. The demand for ice cream isa.elastic.b.inelastic.c.unitarily elastic.d.neither elastic nor inelastic because this situation violates the law of demand.23.Th...
