ECON 304 MICROECONOMICS QUIZ 4 WITH
EXPLAINED ANSWERS 100% CORRECT
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1. Price as a rationing device
Suppose that there are three beachfront parcels of land available for sale in Huntington,
and six people who would each like to purchase one parcel. Assume that the parcels are
essentially identical and that the minimum selling price of each is $575,000. The
following table states each person's willingness and ability to purchase a parcel.
Willingness and Ability to
Purchase
(Dollars)
Brian 750,000
Crystal 660,000
Edison 600,000
Hilary 550,000
Kevin 520,000
Maria 510,000
Which of these people will buy one of the three beachfront parcels?
Check all that apply.
Bria
n
Cryst
al
Edis
on
Points:
1/1
Hilar
Close Explanation
y
Explanation:
Kevi
Brian, Crystal, and Edison will purchase the parcels because they are the only ones willing and
able n
to meet the minimum selling price of $575,000. One or more of the other three people
might have the ability but not the willingness to pay the required price. Moreover, perhaps
Hilary, Kevin, and Maria have a strong desire to own beachfront land in Huntington, but they do
,Hilary, Kevin, and Maria have a strong desire to own beachfront land in Huntington, but they do
ECON 304 MICROECONOMICS QUIZ 4 WITH
EXPLAINED ANSWERS 100% CORRECT
DOWNLOAD TO SCORE A
Mari
a
Assume that the three beachfront parcels are sold to the people that
you indicated in the previous section. Suppose that a few days after the
last of those beachfront parcels is sold, another essentially identical
beachfront parcel becomes available for sale at a minimum price
of $535,000. This fourth parcel will
be sold because Hilary
will purchase it from the seller for at least the minimum price.
, ECON 304 MICROECONOMICS QUIZ 4 WITH
EXPLAINED ANSWERS 100% CORRECT
DOWNLOAD TO SCORE A
Points:
1/1
Close Explanation
Explanation:
To determine what will happen with the fourth parcel, compare the minimum selling price
with the willingness and ability to pay of the remaining buyers. The remaining buyer with the
highest willingness and ability to pay is Hilary at $550,000. Since $550,000 is greater than the
minimum selling price of $535,000 for this parcel, Hilary will purchase the parcel.
1. Price as a rationing device
Suppose that there are three beachfront parcels of land available for
sale in Huntington, and six people who would each like to purchase one
parcel. Assume that the parcels are essentially identical and that the
minimum selling price of each is $745,000. The following table states
each person's willingness and ability to purchase a parcel.
Willingness and Ability to
Purchase
(Dollars)
Felix 900,000
Janet 810,000
Larry 770,000
Megan 720,000
Raphael 690,000
Susan 680,000
Which of these people will buy one of the three beachfront parcels?
Check all that apply.
Felix
, ECON 304 MICROECONOMICS QUIZ 4 WITH
EXPLAINED ANSWERS 100% CORRECT
DOWNLOAD TO SCORE A
Janet
Larry
Megan
Raphae
l Susan
EXPLAINED ANSWERS 100% CORRECT
DOWNLOAD TO SCORE A
1. Price as a rationing device
Suppose that there are three beachfront parcels of land available for sale in Huntington,
and six people who would each like to purchase one parcel. Assume that the parcels are
essentially identical and that the minimum selling price of each is $575,000. The
following table states each person's willingness and ability to purchase a parcel.
Willingness and Ability to
Purchase
(Dollars)
Brian 750,000
Crystal 660,000
Edison 600,000
Hilary 550,000
Kevin 520,000
Maria 510,000
Which of these people will buy one of the three beachfront parcels?
Check all that apply.
Bria
n
Cryst
al
Edis
on
Points:
1/1
Hilar
Close Explanation
y
Explanation:
Kevi
Brian, Crystal, and Edison will purchase the parcels because they are the only ones willing and
able n
to meet the minimum selling price of $575,000. One or more of the other three people
might have the ability but not the willingness to pay the required price. Moreover, perhaps
Hilary, Kevin, and Maria have a strong desire to own beachfront land in Huntington, but they do
,Hilary, Kevin, and Maria have a strong desire to own beachfront land in Huntington, but they do
ECON 304 MICROECONOMICS QUIZ 4 WITH
EXPLAINED ANSWERS 100% CORRECT
DOWNLOAD TO SCORE A
Mari
a
Assume that the three beachfront parcels are sold to the people that
you indicated in the previous section. Suppose that a few days after the
last of those beachfront parcels is sold, another essentially identical
beachfront parcel becomes available for sale at a minimum price
of $535,000. This fourth parcel will
be sold because Hilary
will purchase it from the seller for at least the minimum price.
, ECON 304 MICROECONOMICS QUIZ 4 WITH
EXPLAINED ANSWERS 100% CORRECT
DOWNLOAD TO SCORE A
Points:
1/1
Close Explanation
Explanation:
To determine what will happen with the fourth parcel, compare the minimum selling price
with the willingness and ability to pay of the remaining buyers. The remaining buyer with the
highest willingness and ability to pay is Hilary at $550,000. Since $550,000 is greater than the
minimum selling price of $535,000 for this parcel, Hilary will purchase the parcel.
1. Price as a rationing device
Suppose that there are three beachfront parcels of land available for
sale in Huntington, and six people who would each like to purchase one
parcel. Assume that the parcels are essentially identical and that the
minimum selling price of each is $745,000. The following table states
each person's willingness and ability to purchase a parcel.
Willingness and Ability to
Purchase
(Dollars)
Felix 900,000
Janet 810,000
Larry 770,000
Megan 720,000
Raphael 690,000
Susan 680,000
Which of these people will buy one of the three beachfront parcels?
Check all that apply.
Felix
, ECON 304 MICROECONOMICS QUIZ 4 WITH
EXPLAINED ANSWERS 100% CORRECT
DOWNLOAD TO SCORE A
Janet
Larry
Megan
Raphae
l Susan
