Begin by graphing the standard quadratic function f(x) = x2 . Then use transformations of this graph to graph the given function.h(x) = -(x – 4)2 – 6

Figure: Market Changes If these figures represent the market for gasoline-power cars, which figure shows the effect of an increase in concern about climate change among consumers?

If demand is more elastic than supply, the majority of a tax is paid by the buyers.

Which of these statements is TRUE? A tax and a subsidy are similar in that: I. they both create a deadweight loss. II. the burden of the tax and the benefit of the subsidy depend on relative elasticities of demand and supply. III. they both change the equilibrium level of output.

Figure: Deadweight Loss If a tax has been imposed on buyers in the market, what is the price paid by buyers after the tax?

Which is LEAST likely to be a consequence of the division of knowledge?

Because people instinctively act in the social interest, markets will produce outcomes that are in the social interest.

Figure: Supply and Demand 4 In this market for apartments, a rent-controlled price of $800 will cause a short-run:

Which statement(s) is(are) TRUE? I. The price system solves the information problem by telling us the highest-valued uses of a product. II. The price system solves the incentive problem by giving consumers an incentive to seek out substitutes when the price of a product rises. III. The price system solves the social equity problem by making most products affordable to middle-class households.

Figure: International Trade 4 If, in this figure, the government eliminated free trade, producer surplus would: