Question 1: Describe the major sources of income and expenditures for households
(Evolution of the household) Determine whether each if the following would increase or decrease the opportunity cost for mothers who choose not to work outside the home. Explain your answer.
a. Higher levels of education for women
b. Higher unemployment for women
c. Higher average pay levels for women
d. Lower Demand for labor in industries that traditionally employ large numbers of women.
Summarize the seven roles of government in an economy
Question 2: (Tax related) Suppose taxes are related to income as follows:
Income Taxes
$1,000 $200
$2,000 $350
$3,000 $450
a. What percent of income is paid taxes at each level?
b. Is the tax rate progressive, proportional, or regressive?
c. What is the marginal tax rate on the first $1,000 of income? The second $1,000.00? The third $1,000?
Explain why demand curve slopes downward
Question 3: (Substitutes and Complements) For each of the following pair of goods, determine whether the goods substitutes, complements, or unrelated:
a. Peanut butter and jelly
b. Private and public transportation
c. Coke and Pepsi
d. Alarm clocks and automobiles
e. Gold clubs and golf balls
Identify five things which could shift a demand curve to the right or left:
Questions 4: (Demands Shifters) List five things that are held constant along a market demand curve, and identify the change in each that would shift that demand curve to the right-that is, that would increase demand.
Explain why a supply curve usually slopes upward
Question 5: (Supply) Why is a firm willing and able to increase the quantity supplied as the product price increases?
Predict the impact of a change in demand or supply on the equilibrium price and quantity
Question 6: (Equilibrium) Assume the market fir corn is depicted as in the table that appears below:
a. Complete the table below.
b. What market pressure occurs when quantity demanded exceeds quantity supplied? Explain
c. What market pressure occurs when quantity supplied exceeds quantity demanded? Explain.
d. What is the equilibrium price?
e. What could change the equilibrium price?
f. At each price in the first column of the table below, how much is sold?