Podcast
Questions and Answers
Which of the following is true about comparative statics analysis of ordinary demand functions?
Which of the following is true about comparative statics analysis of ordinary demand functions?
- It studies how ordinary demands change as prices change
- It studies how ordinary demands change as prices and income change (correct)
- It studies how ordinary demands change as income changes
- It studies how ordinary demands change as prices and income change, holding other factors constant
What is the focus of own-price changes in demand analysis?
What is the focus of own-price changes in demand analysis?
- How one demand changes as income changes
- How one demand changes as prices and income change
- How one demand changes as the price of another good changes
- How one demand changes as its own price changes, holding other factors constant (correct)
In the equation p1x1 + p2x2 = y, what does p1 represent?
In the equation p1x1 + p2x2 = y, what does p1 represent?
- The quantity of good 2
- The price of good 2
- The quantity of good 1
- The price of good 1 (correct)
What happens to x1* as p1 increases, holding p2 and y constant?
What happens to x1* as p1 increases, holding p2 and y constant?
What happens to x1* as p1 changes from p1' to p1'' to p1''', holding p2 and y constant?
What happens to x1* as p1 changes from p1' to p1'' to p1''', holding p2 and y constant?
What is the purpose of comparative statics analysis of ordinary demand functions?
What is the purpose of comparative statics analysis of ordinary demand functions?
What does the equation p1x1 + p2x2 = y represent?
What does the equation p1x1 + p2x2 = y represent?
What happens to x1* as p1 increases, holding p2 and y constant?
What happens to x1* as p1 increases, holding p2 and y constant?
What happens to x1* as p1 changes from p1' to p1'' to p1''', holding p2 and y constant?
What happens to x1* as p1 changes from p1' to p1'' to p1''', holding p2 and y constant?
What happens to x2 as p1 changes from p1' to p1'' to p1''', holding p2 and y constant?
What happens to x2 as p1 changes from p1' to p1'' to p1''', holding p2 and y constant?