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WGU D089 Principles Of Economics Objective Assessment Final Exam (2 Latest Versions) Newest 2025 Actual Exam Complete 200 Questions And Correct Answers| Already Graded A+
Version 1 Describe and illustrate a case where there is an increase in demand. Be sure to identify the market being analyzed and the event leading to the increase in demand. - ANSWER-An increase in gas prices when oil is harder to get. World changes that make it harder to receive resources from outside the U.S.
Does a change in the price of a good cause a change in demand or a change in quantity demand? Explain. - ANSWER-If the price goes up, the quantity demanded goes down
Explain the "Law of Supply" using a supply curve to illustrate the concept. - ANSWER-A higher price leads to a higher quantity supplied, and vice versa.
Describe and illustrate a case where there is a decrease in supply. Be sure to identify the market being analyzed and the event leading to the decrease in supply. - ANSWER-COVID 19 1 / 4
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is a good example where the production of coffee was decreased because there was nobody working to produce the product.
The event leading to the decrease in supply is the breakout of the corona virus.
The market being analyzed would be the supply and demand of coffee beans.
Does a change in the price of a good cause a change in supply or a change in quantity supplied? Explain. - ANSWER-If the price increases, the supply decreases.
Assume the market for orange juice is in equilibrium. What will happen to equilibrium price and quantity if there is a particularly bad winter cold going around and people want to boost their vitamin C intake? Use a graph to illustrate your answer. - ANSWER-price and quantity go up and down together. the price and quantity produced will both go up together because the demand for vitamin c is higher
Assume the market for orange juice is in equilibrium. What will happen to the equilibrium price and quantity if a new orange 2 / 4
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picking technology is implemented? Use a graph to illustrate your answer. - ANSWER-price and quantity will increase, because there is a higher supply there will be more people buying oranges which will cause the price to increase
Use the concept of elasticity to explain the difference between a normal and an inferior good. - ANSWER-The concept of elasticity can be used to explain the difference between normal and inferior goods. Normal goods have a positive income elasticity of demand, meaning that demand increases as consumers' incomes increase. Inferior goods, on the other hand, have a negative income elasticity of demand, meaning that demand decreases as consumers' incomes increase. Goods are highly elastic if demand changes drastically when consumers' incomes change.
When a local grocery store increased the price of marshmallows by 8%, the quantity of marshmallows demanded decreased by 16%. What is the price elasticity of marshmallows? - ANSWER-
price elasticity: how much the demand changed based on the
price change
calculated by change in quantity divided by change in price
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in this problem: 16 divided by 8 equals 2
greater than 1 = elastic, means consumer response is large less than 1 = inelastic, consumers are not very responsive equal to one = unit elastic, consumer response did not change
Demand for eggs is inelastic. If the price of eggs increases by 10% does the quantity of eggs decrease by less than 10%, more than 10% or exactly 10%? Explain. - ANSWER-less than 10%
price increases 10%, demand decreases 8% (which is less than 10%)
equation: 8 divided by 10 = 0.8 which is less than 1 (therefore
inelastic)
What is a price floor? Based on the information in the table below, what happens when a price floor is set at $4?
Price Quantity Demanded (units/month) Quantity Supplied (units/month) $1 125 25
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