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Consider public transportation, namely the subway trains in New York city. Suppose consumers’ income increases and that, as a result, the equilibrium quantity Qtrain remains unchanged, and the price Ptrain decreases. Which of the following is a possible explanation for why this happened?

The price of maple syrup goes skyrocketing because of import restrictions on maple syrup. Marketing research team of pancakes firms tells us that the cross price elasticity of pancakes and maple syrup is a negative number. What can you deduce form this observation: (i) Pancakes and maple syrup are substitutes. (ii) Pancakes and maple syrup are complements. (iii) Pancakes and maple syrup are not related in consumption.

Consider the market for regular doughnuts. A new kind of fusion food, called “Mochi donuts” is invented in Econland. These mochi donuts are made from a hybrid batter that makes doughnuts that are flaky and moist, with a satisfying chew. Suppose that the impact of this invention in the market for regular doughnuts is that the price of regular doughnuts remains unchanged, and the equilibrium quantity decreases. A possible explanation for these changes is that “Mochi donuts” and regular doughnuts are ________________ and the supply of regular doughnuts is _____________________________. (Fill in the blanks.)

If the government is concerned about the excessively low price in the unregulated free market equilibrium above, it could impose a __________. If the government sets the price at $8, there is _________ and the amount is equal to __________. 

Suppose that the government imposes a subsidy of $6 per Grubhub delivery to encourage food delivery instead of eating at restaurants. What is the consumer surplus?

Which point(s) ________represent efficiency in the economy?

Raza loves the Escape Room and he has already gone to the Escape Room five times this week. His twin brother Zavi is asking him to go with him for what would be Raza’s sixth time. Assuming that Raza is rational and that his dollar measure of this sixth time is $40, Raza will choose to go if: (i) The dollar measure of the cost to Raza of this sixth time is $40. (ii) The dollar measure of the cost to Raza of this sixth time is $60. (iii) The dollar measure of the cost to Raza of this sixth time is no greater than $40.

Relative to the free market equilibrium, producer surplus after the implementation of this program has _______________ to  _____________. (Fill in the blanks.)

You have taken ECON 1101 Principles of Microeconomics and now as a marketing intern for a small local theater you need to recommend a price change to the manager of a theater who wants to increase its total revenue.  During their last season performance, the theater charged $8 per ticket and they sold 110 tickets. You find out that a similar theater (a competitor) charged $12 per ticket and they sold 90 tickets. Using the midpoint formula, the price elasticity of demand (in absolute value) in this locality is _________. Therefore, demand is _________. You would recommend a price _________________ because the total revenue would then __________. (Fill in the blanks.)

Consider the market for the Apple watch. Suppose that demand is perfectly elastic in the short run and supply is perfectly inelastic. If a tax is imposed in the market, the entire burden of the tax falls on___________, while ___________ surplus does not change. (Fill in the blanks.)