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ECON151[100% CORRECT ANSWERS]

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Question 1.1: To draw the demand curve, the price for using public transportation must be held constant. If the cost of riding the bus declines, which of the following statements are true? Select all ... correct statements. The commuter’s demand curve for gasoline may change. The ceteris paribus assumption is violated. The commuter may ride the bus more and consume less gasoline. The demand curve will become upward sloping. Question 1.2: As the price of gasoline decreases, the quantity demanded of gasoline Increases Question 1.3: What is the total quantity demanded at $3.00 per gallon? 125 175 50 Question 1.4: What is the total quantity demanded at $4.00 per gallon? 100 40 140 Question 1.5: Which arrow on the graph shows a change in Quantity Demanded? A B Both The distinction between a change in demand and a change in the quantity demanded is an important one. A change in the quantity demanded of a good is caused by a change in the price of the good, therefore, “all else equal” creates a ceteris paribus condition. As such, a change in the quantity demanded of a good is represented by a movement along the demand curve. This is in contrast to a change in demand which is caused by a change in anything that affects demand other than the price (e.g. income or [Show More]

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