Gasoline and heating oil can be both processed from the same raw material - crude oil. Assume that the price of heating oil decreases substantially. What will we observe in the market for gasoline?     a) The equilibrium price increases, while the equilibrium quantity decreases     b) The equilibrium price increases, and the equilibrium quantity also increases     c) The equilibrium price decreases, while the equilibrium quantity increases     d) The equilibrium price decreases, and the equilibrium quantity also decreases

1. Which of the following will result in an uncertainty regarding any change that might occur in the equilibrium quantity but a definite increase in the equilibrium price? a) An increase in demand and a decrease in supply b) A decrease in demand and a decrease in supply c) A decrease in demand and an increase in supply d) An increase in demand and an increase in supply 2. In a production possibility frontier (PPF) graph it is observed that points 1,2,3, and 4 lie on the PPF, Point 5 is outside the PPF, and point 6 is inside the PPF. Which of the following statements is correct? a) Point 6 can be produced only if there is an increase in resource availability and/or an improvement in technology. b) Points 1-4 and 6 can be produced with the currently available resources and technology, but resources are used efficiently only at points 1-4. c) Point 5 can be produced with the currently available resources and technology, but the resource use is inefficient. d) Point 6 can be produced with…

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D For the following supply and demand equations, solve for the equilibrium price and quantity. QP = -4P + 12 QS = 3P-2 a) P=10/7, Q=16/7 b) P=1, Q=8 Oc) P=2, Q=7 d) P=2, Q=4