Which of the following statements is true?
a. Over time, when demand for health care continues to rise relatively more than supply, the cost of health care falls.
b. Over time, when demand for health care continues to rise relatively more than supply , the cost of health care continues to rise.
c. An increase in the demand for health care is accompanied by an outward shift in the supply curve.
d. The price of health care rises either with a fall in demand or an increase in supply.
e. The change in the demand for health care with no change in supply causes the price to fall continuously.
QUESTION 2Popeye receives a marginal utility of 12 utils for the last can of spinach consumed. If the price of a can of spinach is 50 cents per can, then the marginal utility per dollar spent on the last can of spinach is equal to:
a. 6 utils per dollar.
b. 12 utils per dollar.
c. 18 utils per dollar.
d. 24 utils per dollar.
QUESTION 3The price of a resource declines when:
a. both the demand for and the supply of the resource declines in the same proportion.
b. demand remaining constant, supply of the resource declines.
c. supply remaining constant, the demand for the resource declines.
d. both the demand for and the supply of the resource increases in the same proportion.
e. both the demand for and the supply of the resource declines, but supply falls by a greater proportion than demand.
QUESTION 4Which of the following statements is true?
a. With an increase in the demand for health care, the quantity supplied increases but supply does not change.
b. With an increase in the demand for health care, the supply curve shifts to the right.
c. With an increase in the demand for health care, the supply curve shifts to the left.
d. With an increase in the demand for health care, the price of the product decreases.
e. With an increase in the demand for health care, the quantity supplied decreases but the supply does not change.
QUESTION 5Peanuts are 3 per pound and cashew nuts are 5 per pound. If the marginal utility from consuming the last pound of cashew nuts equals 15 utils, then the marginal utility from consuming the last pound of peanuts in consumer equilibrium should equal:
a. 18 utils.
b. 15 utils.
c. 9 utils.
d. 5 utils.
QUESTION 6Assume that labor is the only variable input and that an additional input of labor increases total output from 72 to 78 units. If the product sells for 6 per unit in a perfectly competitive market, then the marginal revenue product of this additional worker is:
a. 78.
b. 72.
c. 36.
d. 39.
e. 6.
QUESTION 7Which of the following is a possible reason for a comparatively steeper demand curve for health care?
a. A large increase in the price of health care leads to a more than proportionate fall in the quantity demanded for health care.
b. The demand curve for health care is comparatively steeper than other products, because health care is a Giffen good.
c. A change in the price of health care leads to no change in the profit earned by the suppliers.
d. A large increase in the income of households leads to a less than proportionate increase in the quantity demanded.
e. A large increase in price does not cause a reduction in the purchase of health care by the same proportion.
Quick Reply
