If gasoline is a complementary good for the gasoline-powered cars, then we predict that the demand for gasoline will shift right due to the introduction of the new battery and the equilibrium price of gasoline will increase and the equilibrium quantity of gasoline will increase. MULTIPLE CHOICE QUESTIONS (20 QUESTIONS WORTH 3.5 POINTS EACH) Use the following information for the next two (2) questions: Alice, Bob, and Charlene can each produce Widgets and Gadgets. The following table expresses how many widgets or gadgets each can produce if they produce none of the other good. Assume opportunity costs are constant along the entire production possibility frontier for each person. Widgets Gadgets Alice 1 3 Bob 3 1 Charlene 5 5 Who has the comparative advantage in the production of widgets and gadgets respectively? Alice in widgets; Bob in gadgets Bob in widgets; Alice in gadgets Alice in widgets; Charlene in gadgets Charlene in both widgets and gadgets Which of the following equations expresses the equation for the Joint Production Possibility Frontier for Alice, Bob, and Charlene? Let W be the number of Widgets and G be the number of Gadgets. Assume G is the horizontal variable. Multiple Choice Answer to Bubble In W = 9 3G W = 7 G W = 3 (1/3)G a. – – – for G 1 for 1 G 6 for 6 9 0 ≤ ≤ ≤ ≤ ≤ G ≤ b. W = 9 (1/3)G W = 11 G W = 27 3G – – – for 0 3 for 3 G 8 for 8 G 9 ≤ G ≤ ≤ ≤ ≤ ≤ c. W = 9 (13/3)G W = 6 (4/3)G W = 5 G – – – for 0 G 1 for 1 G 3 for 3 G 9 ≤ ≤ ≤ ≤ ≤ ≤ d. W = 5 G W = (9/2) (3/4)G W = (27/3) (24/14)G – – – for 0 G 2 for 2 G (14/3) for (14/3) G 9 ≤ ≤ ≤ ≤ ≤ ≤
If gasoline is a complementary good for the gasoline-powered cars, then we predict that the demand for gasoline will shift right due to the introduction of the new battery and the equilibrium price of gasoline will increase and the equilibrium quantity of gasoline will increase. MULTIPLE CHOICE QUESTIONS (20 QUESTIONS WORTH 3.5 POINTS EACH) Use the following information for the next two (2) questions: Alice, Bob, and Charlene can each produce Widgets and Gadgets. The following table expresses how many widgets or gadgets each can produce if they produce none of the other good. Assume opportunity costs are constant along the entire production possibility frontier for each person. Widgets Gadgets Alice 1 3 Bob 3 1 Charlene 5 5 Who has the comparative advantage in the production of widgets and gadgets respectively? Alice in widgets; Bob in gadgets Bob in widgets; Alice in gadgets Alice in widgets; Charlene in gadgets Charlene in both widgets and gadgets Which of the following equations expresses the equation for the Joint Production Possibility Frontier for Alice, Bob, and Charlene? Let W be the number of Widgets and G be the number of Gadgets. Assume G is the horizontal variable. Multiple Choice Answer to Bubble In a. W = 9 – 3G for 0 ≤ G ≤ 1 W = 7 – G for 1 ≤ G ≤ 6 W = 3 – (1/3)G for 6 ≤ G ≤ 9 b. W = 9 – (1/3)G for 0 ≤ G ≤ 3 W = 11 – G for 3 ≤ G ≤ 8 W = 27 – 3G for 8 ≤ G ≤ 9 c. W = 9 – (13/3)G for 0 ≤ G ≤ 1 W = 6 – (4/3)G for 1 ≤ G ≤ 3 W = 5 – G for 3 ≤ G ≤ 9 d. W = 5 – G for 0 ≤ G ≤ 2 W = (9/2) – (3/4)G for 2 ≤ G ≤ (14/3) W = (27/3) – (24/14)G for (14/3) ≤ G ≤ 9