A bakery would be willing to supply 500 bagels per day at a price of $0.50 each. At a price of $0.80, the bakery would be willing to supply 1,100 bagels. Using the midpoint method, the elasticity of supply for bagels is about

• 1.24.

• 0.62.

• 0.77.

• 1.63.

A bakery would be willing to supply 500 bagels per day at a price of $0.50 each. At a price of $0.80, the bakery would be willing to supply 1,100 bagels. Using the midpoint method, the elasticity of supply for bagels is about

• 1.63.

• 0.77.

• 0.62.

• 1.24.

A certain cowboy spends 10 hours per day mending fences and herding cattle. For him, a graph that shows his various possible mixes of output is called his

• Trade-off curve.

• Consumption possibilities frontier.

• Line of tastes.

• Production possibilities frontier.

A change in ______ leads to a change in demand that causes a ______.

• Income or price of other goods; movement along the demand curve

• Income or price of the original produce; movement along the demand curve

• Income or price of other goods; shift in the demand curve

• The price of the original product; shift of the demand curve

A change in the ______ of a good or service leads to a change in ______ that leads to a ______.

• Supply; demand; change in price

• Price; quantity demanded; movement along the demand curve

• Quantity; supply; change in demand

• Demand; quantity demanded; change in supply

A circular-flow diagram is a model that

• Helps to explain how the economy is organized (2).

• (1) and (2) are incorrect.

• Helps to explain how participants in the economy interact with one another (1).

• (1) and (2) are correct.

A country's GDP would be affected by

• income earned by the country's residents abroad.

• changes in exchange rates.

• ncome earned by foreign residents within the country.

• government spending on foreign aid.

A drought in California destroys many red grapes. As a result of the drought, the consumer surplus in the market for red grapes.

• Increases, and the consumer surplus in the market for red wine decreases.

• Increases, and the consumer surplus in the market for red wine increases.

• Decreases, and the consumer surplus in the market for red wine decreases.

• Decreases, and the consumer surplus in the market for red wine increases.

A German citizen buys an automobile produced in the United States by a Japanese company. As a result,

• U.S. net exports and GDP are unaffected, Japanese GNP increases, and german net exports, GNP, and GDP decrease.

• U.S. net exports increase, U.S. GDP is unaffected, Japanese GNP increases, german net exports decrease, and German GNP and GDP are unaffected.

• U.S. net exports and GDP increase, Japanese GNP increases, German net exports decrease, and German GNP and GDP are unaffected.

• U.S. net exports and GDP increase, Japanese GNP increases, German net exports decrease, German gnp is unaffected, and German GDP decreases.

A group of buyers and sellers of a good or service is called a

• Coalition

• Market

• Economy

• Competition