Microeconomics, 10e (Parkin)Part 2 ReviewHow Markets Work1) Gadgets, Inc. can increase its total revenue by raising the price of its product. From this result we can conclude that theA) price increase increases demand for the firms product.B) firm sells an inferior good.C) demand for the firms product is price inelastic.D) demand for the firms product is price elastic.Answer: CTopic: Total Revenue and ElasticitySkill: ConceptualQuestion history: Previous edition, Part Review 2AACSB: Reflective Thinking2) Widgets, Inc. can increase its total revenue by lowering the price of its product. From this result we can conclude that theA) decrease in price increases demand for the firms product.B) firm sells an inferior good.C) demand for the firms product is price inelastic.D) demand for the firms product is price elastic.Answer: DTopic: Total Revenue and ElasticitySkill: ConceptualQuestion history: Previous edition, Part Review 2AACSB: Reflective Thinking3) If OPEC cuts oil production to increase their total revenue, we know that A) the demand for gasoline will decrease.B) the price of gasoline will fall.C) the demand for oil in the global market is inelastic.D) OPEC faces a horizontal demand for oil curve.Answer: CTopic: Total Revenue and ElasticitySkill: ConceptualQuestion history: Previous edition, Part Review 2AACSB: Reflective Thinking4) If OPEC cuts oil production to increase their total revenue, we know that theA) demand for gasoline will decrease.B) price of gasoline will rise.C) demand for oil in the global market is elastic.D) supply of gasoline will increase.Answer: BTopic: Total Revenue and ElasticitySkill: ConceptualQuestion history: Previous edition, Part Review 2AACSB: Reflective Thinking5) If OPEC cuts oil production to increase their total revenue, we know that theA) demand for gasoline will decrease.B) price of gasoline will fall.C) demand for oil in the global market is elastic.D) supply of gasoline will decrease.Answer: DTopic: Change in SupplySkill: ConceptualQuestion history: Previous edition, Part Review 2AACSB: Reflective Thinking6) The figure above shows the market for digital cameras. If the price of film cameras falls, the efficient quantity of digital cameras will be _ thousand cameras and the marginal cost of a digital camera will be _.A) less than 300; less than $300B) greater than 300; less than $300C) 300; greater than $300D) greater than 400; greater than $310Answer: ATopic: Efficient QuantitySkill: AnalyticalQuestion history: Previous edition, Part Review 2AACSB: Analytical Skills7) The figure above shows the market for digital cameras. If consumers incomes rise and a digital camera is a normal good, the efficient quantity of digital cameras to produce will be _ thousand cameras and the marginal cost of a digital camera will be _.A) less than 300; less than $300B) greater than 300; less than $300C) 300; greater than $300D) greater than 300; greater than $300Answer: DTopic: Equilibrium QuantitySkill: AnalyticalQuestion history: Previous edition, Part Review 2AACSB: Analytical Skills8) The figure above shows the market for digital cameras. If consumers income rise and a digital camera is a normal good, the efficient quantity of digital cameras will be _ thousand cameras and the equilibrium quantity will be _ thousand cameras.A) less than 300; less than 300B) greater than 300; less than 300C) 300; greater than 300D) greater than 300; greater than 300Answer: DTopic: Equilibrium and Efficient QuantitySkill: AnalyticalQuestion history: Previous edition, Part Review 2AACSB: Analytical Skills9) The figure above shows the market for digital cameras. The price of film cameras falls. In the new equilibrium, the price of a digital camera will be _ and the marginal benefit from the last digital camera purchased will be _.A) less than $300; less than $300B) greater than $300; less than $300C) $300; greater than $300D) greater than $300; greater than $300Answer: DTopic: Equilibrium Price and Marginal CostSkill: AnalyticalQuestion history: Previous edition, Part Review 2AACSB: Analytical Skills10) The figure above shows the market for digital cameras. If there are technological advances in making digital cameras, the efficient quantity of digital cameras will be _ thousand cameras and the equilibrium quantity will be _ thousand cameras.A) less than 300; less than 300B) greater than 300; less than 300C) 300; greater than 300D) greater than 300; greater than 300Answer: DTopic: Equilibrium and Efficient QuantitySkill: AnalyticalQuestion history: Previous edition, Part Review 2AACSB: Analytical Skills11) The figure above shows the market for digital