Question

QUESTION 4 To an economist, a decrease in supply means a: a. leftward shift of the supply curve. b. movement up along a supply curve. c movement down along the supply curve. d. rightward shift of the supply curve. QUESTION 5 Consumers will willingly make less-informed decisions: a. whenever acquiring more information requires sacrifice. b. if information costs are less than the perceived benefits of gathering information. c. if information costs are greater than the perceived benefits of gathering information. d. since ignorance always leads to bliss.

Answer 1

9:47 To an economis cerease in supply mians a les a fiftward shift of the supply (wive. This Ocewes because decrease in supply take place dule to changes in the other factess feeting supply wiluas movement along the supply were takes place due to change in price of Quantity supply, Si Price Supply curve (Decrease in supply Shefts were from S, to sz) Quantity Qu5) Consumers will willingly make less - informed decisions 10 | information costs are greater than the perceived benefits of gathering information This occurs because it consumers are provide with the information at the cost which is less than benefits they then they make complete - informed decisions But as tenst cost is greater therefore there must be a less - informed decision.

Q.6] Assume there is a price flour imposedem a ged which is above the equilibrium face then an increase in demand would reduce the size of the Surplus. This is because an increase will shift demand wine rightward which reduce the size of the surplus PHILL Let Suribus lice at ot 1 Quantity After the increase in demand, the would be size of surplus Subtus Pusle floor frice Quantity

5. If the government equired car makvu to Stall moale costly and effective Cruisions control divia en cars it will leads to 16) a higiene price ry cares and a smaller quantity U sold. This olives because an inculate in the cost of inputs lesed in 2014 making will leads to a cuiict increase m fuices of cours which will reduce the demand of cars and hence a smaller quantity of caurs sold. to increase in cost of inputs will shifts the supply wwe liftward and hence an higher price of cars and the quantity of cars sold will fall down. પાત Quantity Scanned with CamScanner