AP (Advanced Placement) Microeconomics: Questions 263 - 266 of 398

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Question 263

Question

MCQ▾

In the Cobweb theory, what outcomes can be expected if the supply curve is steeper than the demand curve?

Choices

Choice (5)Response

a.

Outward spiral resulting in an unstable and divergent case

b.

Inward spiral resulting in a stable and convergent case

c.

Instantaneous change in change due to change in demand

d.

All of the above

e.

Question does not provide sufficient data or is vague

Question 264

Question

Assertion-Reason▾

Assertion(Ꭺ)

The demand and AC curves have a geometrical relationship

Reason(Ꭱ)

Price and output combinations lies on demand and AC curves

Choices

Choice (5)Response

a.

Both Ꭺ and Ꭱ are true and Ꭱ is the correct explanation of Ꭺ

b.

Both Ꭺ and Ꭱ are true but Ꭱ is NOT the correct explanation of Ꭺ

c.

Ꭺ is true but Ꭱ is false

d.

Ꭺ is false but Ꭱ is true

e.

Both Ꭺ and Ꭱ are false

Question 265

Question

MCQ▾

Which of the following represents second degree price discrimination?

Choices

Choice (5)Response

a.

Student discount

b.

Sale in antique markets

c.

Bulk discount

d.

Bundling

e.

Question does not provide sufficient data or is vague

Question 266

Question

MCQ▾

Which conditions are satisfied in the Stackelberg model?

Choices

Choice (5)Response

a.

Industry output is

b.

Quantity leadership

c.

Reaction function of firm 2 is

d.

All a., b. and c. are correct

e.

None of the above

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