Question 31

An increase in the consumer surplus in the market for milkshakes may result from a(n) _______ in the _______ of milkshakes.

Question 31 options:

a)	increase; price

b)	increase; supply

c)	decrease; demand

d)	decrease; supply

Question 32

Producer surplus is represented by the area _______ the supply curve and _______ the market price.

Question 32 options:

a)	above; above

b)	below; below

c)	above; below

d)	below; above

e)	none of the above.

Question 33

The price of a notebook is $5, and at that price consumers purchase 12 notebooks. If the price rises to $7, consumers will decrease consumption to 4 notebooks. Using the midpoint formula, what is the price elasticity of demand for notebooks?

Question 33 options:

a)

0.17

b)

0.33

c)

1

d)

3

e)

6

Question 34

A price elasticity of demand equal to 5 means:

Question 34 options:

a)	quantity demanded falls by 1 when price rises by $5.

b)	quantity demanded falls by 5 when price rises by $1.

c)	a 1% change in price will change quantity demanded by 5%.

d)	a 5% change in price will change quantity demanded by 1%.

e)	a 1% change in price will change total revenue by 5%.

Question 35

At the student center, a 20% increase in the price of beer results in a 5% decrease in the quantity consumed. The implies that the price elasticity of beer at the student center equals:

Question 35 options:

a)

0.25

b)

4

c)

25

d)

15%

e)

25%