微观经济学（第九版）试题英文版chapter 04.docx

Microeconomics, 9e (Pindyck/Rubinfeld)Chapter 4 Individual and Market Demand4.1 Individual Demand1) Refer to Figure 4.1.1 above. From the information in the figure we can obtain: A) a point on a demand curve.B) a series of points on a demand curve.C) a price-consumption curve.D) an income-consumption curve.Answer: ADiff： 1Section: 4.12) After a good falls in price, consumers are better off because they can buy the same amount of the good for less money, and thus have money left over for additional purchases. This fact is called:A) the income e仔ect.B) the substitution effect.C) the wealth effect.D) the price effect.Answer: ADiff: 1Section: 4.2The response to a change in the relative prices of goods is called:A) the income effect.B) the substitution effect.C) the wealth effect.D) the price effect.Answer: BDiff: 1Section: 4.2The change in demand resulting from this change in real purchasing power is called:A) the income effect.B) the substitution e仔ect.C) the wealth effect.D) the price effect.Answer: ADiff： 1Section: 4.2Ck>lhiAg (unit、fvrCk>lhiAg (unit、fvrluniN pv，Refer to Figure 4.2.1 above. Which of the following moves represents the substitution effect?A) The move from F to EThe move from E to F2B) The move from F to F?C) A move from F to F? and then to £Answer: ADiff: 1Section: 4.23) Refer to Figure 4.2.1 above. Which of the following moves represents the income effect?A) The move from to EThe move from E to F2B) The move from Fj to F2A move from to F? and then to EAnswer: BDiff： 1Section: 4.2Refer to Figure 4.2.1 above. Starting at point A, which of the following moves represents the total effect of a price change?A) The move from Fj to EThe move from E to F2B) The move from F】to F?C) A move from Fj to F? and then to EAnswer: CDiff: 1Section: 4.24) A change in consumption of a good associated with a change in its price, with the level of utility held constant, is referred to as:A) the income e仔ect.B) the substitution effect.C) the wealth effect.D) the total effect of a price change.Answer: BDiff: 1Section: 4.2A change in consumption of a good resulting from an increase in purchasing power, with relative prices held constant, is referred to as:A) the income effect.B) the substitution effect.C) the wealth effect.D) the total effect of a price change.Answer: ADiff： 1Section: 4.2CliHhinglunitptrrA f. fFed<unit> per month)5) Refer to Figure 4.2.2 above. Starting at point A, which of the following represents the substitution effect of an increase in the price of food?A) The move from A to BThe move from A to CB) The move from A to B, and then to CThe move from A to C, and then to BAnswer: ADiff: 1Section: 4.26) Refer to Figure 4.2.2 above. Starting from point A, after the price of food decreases, the quantity of food purchased:A) increases, due to the income effect but decreases due to the substitution effect.B) increases, due to the substitution effect but decreases due to the income effect.C) increases from A to B due to the income effect, and then to C due to the substitution effect.D) decreases.Answer: BDiff: 1Section: 4.2Refer to Figure 4.2.2 above. The effect of a decrease in the price of food, as depicted in the figure, leads us to believe that:A) food in an inferior good and clothing a normal good.B) food in a normal good and clothing an inferior good.C) both food and clothing are normal goods.D) both food and clothing are inferior goods.Answer: ADiff: 2Section: 4.2For an inferior good, the income and substitution effectsA) work together.B) work against each other.C) can work together or in opposition to each other depending upon their relative magnitudes.D) always exactly cancel each other.Answer: BDiff： 1Section: 4.2Which of the following is true concerning the substitution effect of a decrease in price?A) It will lead to an increase in consumption only for a normal good.B) It always will lead to an increase in consumption.C) It will lead to an increase in consumption only for an inferior good.D) It will lead to an increase in consumption only for a Giffen good.Answer: BDiff： 1Section: 4.2Assume that beer is a normal good. If the price of beer rises, then the substitution effect results in the person buying of the good and the income effect results in the person buying of thegood.A) more; moremore; lessB) less; moreless; lessAnswer: DDiff: 2Section: 4.2Assume that beer is an inferior good. If the price of beer falls, then the substitution effect results in the person buying of the good and the income effect results in the person buying ofthe good.A) more; moremore; lessB) less; moreless; lessAnswer: BDiff: 2Section: 4.2A Giffen goodA) is always the same as an inferior good.B) is the special subset of inferior goods in which the substitution effect dominates the income effect.C) is the special subset of inferior goods in which the income effect dominates the substitution effect.D) must have a downward sloping demand curve.Answer: CDiff: 1Section: 4.2Refer to Figure 4.2.3 above. The effect of a decrease in the price of food, as depicted in the figure, leads us to believe that:A) food is an inferior good and clothing a Giffen good.B) food is a normal good and clothing a Giffen good.C) food is a Giffen good and clothing a normal good.D) food is a Giffen good and clothing an inferior good.Answer: CDiff: 2Section: 4.2Scenario 41:Daniel derives utility from only two goods, cake (Qc) and donuts (Qd). The marginal utility that Daniel receives from cake (MUc) and donuts (MUd) are given as follows:MUc = QdMUd = QcDaniel has an income of $240 and the price of cake (Pc) and donuts (Pd) are both $3.7) See Scenario 4.1. What is Daniels budget constraint?A) 240 = 3Pc + 3Pd240 = 3Qc + 3QdB) 240 = (Pc)(Qc)240 = (Qc)(Qd)C) none of the aboveAnswer: BDiff: 2Section: 4.28) See Scenario 4.1. What is Daniel's income-consumption curve?A) Pc = PdPc = QcB) Qd = I - 3QcQc = QdC) all of the aboveAnswer: DDiff: 3Section: 4.29) See Scenario 4.1. What quantity Qc will maximize Daniefs utility given the information above? A)024B) 4060C) none of the aboveAnswer: CDiff: 3Section: 4.210) See Scenario 4.1. Holding Daniels income and Pd constant at $240 and $3 respectively, what is DanieFs demand curve for cake?A) Qc = 240 - PcQc = 240/PcB) Qc = 120/PcQc = 240/(3 + Pc)C) none of the aboveAnswer: DDiff: 3Section: 4.211) You have just won a cash award of $500 for academic excellence.A) The substitution effect of this award will be larger than its income effect.B) The income effect of this award will be larger than its substitution effect.C) The substitution and income effects will be of identical size.D) It is impossible to know whether the substitution effect is larger than the income effect or vice versa. Answer: BDiff: 3Section: 4.2Suppose the price of rice increases and you view rice as an inferior good. The substitution effect results in a change in rice consumption, and the income effect leads to a change in riceconsumption.A) positive; positivepositive; negativeB) negative; positivenegative; negativeAnswer: CDiff: 1Section: 4.212) Donald derives utility from only two goods, carrots (Qc) and donuts (Qd). His utility function is as follows:U(Qc,Qd) = (Qc)(Qd)The marginal utility that Donald receives from carrots (MUc) and donuts (MUd) are given as follows: MUc = QdMUd = QcDonald has an income (I) of $120 and the price of carrots (Pc) and donuts (Pd) are both $1.a. What is Donalds budget line?b. What is Donalds income-consumption curve?c. What quantities of Qc and Qd will maximize Donald's utility?d. Holding Donalds income and Pd constant at $120 and $1 respectively, what is Donalds demand curve for carrots?e. Suppose that a tax of $1 per unit is levied on donuts. How will this alter Donalds utility maximizing market basket of goods?f. Suppose that, instead of the per unit tax in (e), a lump sum tax of the same dollar amount is levied on Donald. What is Donalds utility maximizing market basket?g. The taxes in (e) and (f) both collect exactly the same amount of revenue for the government, which of the two taxes would Donald prefer? Show your answer numerically and explain why Donald prefers the per unit tax over the lump sum tax, or vice versa, or why he is indifferent between the two taxes.Answer:a.Budget line: 120 = Qc + Qdb.The income consumption curve must satisfy:MUd/MUc = Pd/PcSubstituting for MUd, MUc, Pd, and Pc yields:Qc/Qd = 1 or Qc = QdSubstituting the information in (b) into the budget line:120 = Qc + Qc = 2QcQc = 60Qd = 60d.Rewriting the budget line:120 = PcQc + QdSubstituting the information in (b) into the budget line:120 = PcQc + Qc = Qc(Pc + 1)Qc = 120/(Pc + 1)e.The $1 tax on donuts raises the after-tax price to $2. The income-consumption curve becomes: MUd/MUc = Pd/PcSubstituting for MUd, MUc, Pd and Pc yields:Qc/Qd = 2 or Qc = 2QdThe budget line is:120 = Qc + 2QdSubstitute the income-consumption curve into the budget line to eliminate Qc:120 = 2Qd + 2Q = 4QdQd = 30Qc = 60/Donald buys 30 donuts, so he pays $30 in tax. If Donald paid $30 in a lump sum tax, his income would be $90. Resolve the utility maximization problem with I = 90, Pc = Pd = 1.The utility maximizing market basket is Qc = Qd = 45.4Donald prefers the lump-sum tax to the excise tax. Use the utility function to show which market basket is preferred.U(Qc, Qd) = QcQdlump-sum taxU(45, 45) = 45 x 45 = 2,025excise taxU(60, 30) = 60 x 30 = 1,800Diff: 3Section: 4.24.3 Market Demand1) The horizontal summation of the demands of each consumer at different price levels is called: A) the market demand curve.B) the price elasticity of market demand.C) speculative demand.D) consumer surplus.Answer: ADiff： 1Section: 4.3CicuMiry2) Refer to Figure 4.3.1 above. The figure depicts the individual demands of the only three consumers in the market for good X. After constructing the market demand curve, we determine that quantity demanded at a price of $10,000 is:A) 15 units.B) 17 units.C) 30.000 units.D) none of the aboveAnswer: BDiff： 1Section: 4.33) Aggregation examples of market demand could include:A) the demand for home computers by households with or without children.B) the domestic and foreign demand for wheat.C) the demands of different demographic groups.D) all of the aboveAnswer: DDiff: 1Section: 4.34) Price elasticity of demand measures the:A) slope of the demand curve.B) sensitivity of quantity demanded to changes in the price of substitute goods.C) sensitivity of price to changes in the quantity demanded of substitute goods.D) sensitivity of quantity demanded to changes in price.Answer: DDiff: 1Section: 4.3Clothing<uruh jvr nv«nib)Clothing<uruh jvr nv«nib)I'cxxl <uniKpi,r month)Refer to Figure 4.1.2. The connection of points B and D forms:A) a demand curve.B) an income-consumption curve.C) a price-consumption curve.D) a shift from one demand curve.to another.Answer: CDiff: 1Section: 4.1Refer to Figure 4.1.2. From the information on the figure, we can obtain: A) an upward-sloping demand curve.B) two points on a downward-sloping individual demand curve.C) a downward-sloping market demand curve.D) a demand curve for food and clothing.Answer: BDiff: 1Section: 4.1An individual demand curve can be derived from the curve.A) price-consumptionprice-incomeB) income-substitutionincome-consumptionC) EngelAnswer: ADiff: 1Section: 4.1Refer to Figure 4.3.2 above. How do total expenditures on movie tickets vary along the demand curve? A) Since quantity demanded increases as price decreases, total expenditures increase.B) Since the quantity is sold at lower and lower prices, total expenditures decrease as quantity demanded increases.C) Total expenditures remain the same between points along the demand curve.D) Total expenditures increase through the upper portion of the curve and then decrease at low price levels.Answer: CDiff: 2Section: 4.3Refer to Figure 4.3.2 above. The elasticity of the demand for the curve in the figure can be described as:A) elastic in the upper portions of the curve and inelastic in the lower portions.B) a special case of an isoelastic curve called the unit-elastic demand curve.C) elastic throughout the curve.D) inelastic throughout the curve.Answer: BDiff: 2Section: 4.3When demand is inelastic, an increase in price leads to: A) an increase in total expenditures.2) a decrease in total expenditures.3) no change in total expenditures.4) an undetermined change in expenditures.Answer: ADiff： 2Section: 4.38) When demand is elastic, an increase in price leads to:A) an increase in total expenditures.B) a decrease in total expenditures.C) no change in total expenditures.D) an undetermined change in expenditures.Answer: BDiff: 2Section: 4.3When demand is inelastic, an increase in price causes the seller's total revenues to:A) increase.B) decrease.C) remain the same.D) fall to zero.Answer: ADiff： 2Section: 4.3When demand is elastic, an increase in price causes the sellers total revenue to:A) increase.B) decrease.C) remain the same.D) fall to zero.Answer: BDiff: 2Section: 4.3Scenario 42:Suppose that the demand for artichokes (Qa) is given as:Qa = 200 - 4PUse the information in Scenario 4.2. What is the price elasticity of demand if the price of artichokes is $10?A)0-0.25B) -1-4C) negative infinityAnswer: BDiff: 2Section: 4.39) Use the information in Scenario 4.2. Suppose that the price of artichokes is increased slightly from $10. The total expenditure by consumers on artichokes will and the number of artichokes soldwill.A) rise; riserise; fallB) fall; risefall; fallAnswer: BDiff： 2Section: 4.3The domestic demand for wheat is Qjjjj = 1000 - 25P, and the export demand is Q°E = 5。- 25P.Graph the domestic, export, and total demand curves for wheat.32nlity(million32nlity(millionDiff: 3Section: 4.3-万2 Jtzw二 EEFill in the blanks. Poorer countries have a demand for U.S. wheat because they usuallyA) less elastic; find other substitutesless elastic; can't find other substitutesB) more elastic; can't find other substitutesmore elastic; find other substitutesAnswer: DDiff: 3Section: 4.315) A local retailer has decided to carry a well-known brand of shampoo. The marketing department tells them that the quarterly demand by an average man is:Qd = 3 - 0.25Pand the quarterly demand by an average woman is:Qd = 4 - 0.5PThe market consists of 10,000 men and 10,000 women. How may bottles of shampoo can they expect to sell if they charge $6 per bottle?A) 20,000B) 33,000C) 25,000D) 10,000C) none of th