6.For a straight-line, downward-sloping demand curve, price elasticity of demand

Question

6.For a straight-line, downward-sloping demand curve, price elasticity of demand
a. decreases as we move down and along the curve from higher to lower prices.
b. a or b depending on the actual slope of the demand curve
c. increases as we move down and along the curve from higher to lower prices.
d. remains constant along the entire demand curve.

7.Joe is currently in consumer equilibrium by consuming cheese and crackers, such that the last cracker consumed yielded 8 utils and the last piece of cheese consumed yielded 12 utils. Assume the price of crackers is two cents per cracker and the price of cheese is three cents per piece. If the price of crackers increases to four cents, Joe should __________ his consumption of crackers and his marginal utility from crackers will __________ and also __________ his consumption of cheese and his marginal utility from cheese will __________.
Choose one answer.
a. increase; increase; increase; increase
b. increase; decrease; increase; decrease
c. decrease; increase; decrease; increase
d. increase; increase; decrease; decrease
e. decrease; increase; increase; decrease

Explanation / Answer

23.Currently, 100 units of good X are being produced and the opportunity cost of producing 1X is 3Y. If good X is produced at increasing opportunity costs, then when the economy produces 120 units of good X the opportunity cost of producing 1Y could be
Choose one answer.
a. 1/3X
b. 1X
c. 1/2X
d. none of the above
e. 1/4X

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