Question 1

Economists typically measure efficiency using

Accepted Answer

A)   the price paid by buyers.
B)   the quantity supplied by sellers.
C)   total surplus.
D)   profits to firms.E) None of the above
F) B) and C)

Question 2

Which of the following equations is not valid?

Accepted Answer

A)   Consumer surplus = Value to buyers - Amount paid by buyers
B)   Producer surplus = Amount received by sellers - Cost to sellers
C)   Total surplus = Value to buyers - Amount paid by buyers + Amount received by sellers - Costs of sellers
D)   Total surplus = Value to sellers - Cost to sellersE) None of the above
F) All of the above

Question 3

Janine would be willing to pay $50 to see Les Misérables,but she buys a ticket for only $30.Janine values the performance at

Accepted Answer

A)   $20.
B)   $30.
C)   $50.
D)   $80.E) A) and B)
F) None of the above

Question 4

Producer surplus directly measures

Accepted Answer

A)   the well-being of sellers.
B)   production costs.
C)   excess demand.
D)   unsold inventories.E) B) and D)
F) None of the above

Question 5

Figure 7-18 
-Refer to Figure 7-18.Assume demand increases and as a result,equilibrium price increases to $22 and equilibrium quantity increases to 110.The increase in producer surplus would be

Accepted Answer

A)   $210.
B)   $360.
C)   $480.
D)   $570.E) B) and C)
F) A) and D)

Question 6

Cost is a measure of the

Accepted Answer

A)   seller's willingness to sell.
B)   seller's producer surplus.
C)   producer shortage.
D)   seller's willingness to buy.E) All of the above
F) None of the above

Question 7

Consumer surplus

Accepted Answer

A)   is the amount of a good that a consumer can buy at a price below equilibrium price.
B)   is the amount a consumer is willing to pay minus the amount the consumer actually pays.
C)   is the number of consumers who are excluded from a market because of scarcity.
D)   measures how much a seller values a good.E) A) and D)
F) B) and D)

Question 8

Table 7-4
The numbers in Table 7-1 reveal the maximum willingness to pay for a ticket to a Chicago Cubs vs.St.Louis Cardinal's baseball game at Wrigley Field.
 
-Refer to Table 7-4.If you have two (essentially) identical tickets that you sell to the group in an auction,what will be the selling price for each ticket?

Accepted Answer

A)   $21
B)   $26
C)   $51
D)   $61E) A) and B)
F) A) and C)

Question 9

Table 7-7
The following table represents the costs of five possible sellers.
 
-Refer to Table 7-7.If the market price is $1,100,the combined total cost of all participating sellers is

Accepted Answer

A)   $3,700.
B)   $2,700.
C)   $2,250.
D)   $1,250.E) A) and B)
F) A) and C)

Question 10

If Darby values a soccer ball at $50,and she pays $40 for it,her consumer surplus is $90.

Accepted Answer

A) True 
 B)False

Question 11

Figure 7-1 
-Refer to Figure 7-1.If the price of the good is $200,then

Accepted Answer

A)   consumer surplus is $150.
B)   consumer surplus is $650.
C)   producer surplus is $650.
D)   producer surplus is $750.E) A) and B)
F) B) and D)

Question 12

Table 7-11
 
-Refer to Table 7-11.The equilibrium price is

Accepted Answer

A)   $10.00.
B)   $8.00.
C)   $6.00.
D)   $4.00.E) A) and B)
F) B) and C)

Question 13

Which of the following will cause a decrease in producer surplus?

Accepted Answer

A)   the imposition of a nonbinding price ceiling in the market
B)   buyers expect the price of a good to be higher next month
C)   the price of a substitute increases
D)   income increases and buyers consider the good to be inferiorE) A) and C)
F) C) and D)

Question 14

If the cost of producing sofas decreases,then consumer surplus in the sofa market will

Accepted Answer

A)   increase.
B)   decrease.
C)   remain constant.
D)   increase for some buyers and decrease for other buyers.E) C) and D)
F) A) and C)

Question 15

If Darby values a soccer ball at $50,and she pays $40 for it,her consumer surplus is $10.

Accepted Answer

A) True 
 B)False

Question 16

Consumer surplus is

Accepted Answer

A)   a concept that helps us make normative statements about the desirability of market outcomes.
B)   represented on a graph by the area below the demand curve and above the price.
C)   a good measure of economic welfare if buyers' preferences are the primary concern.
D)   All of the above are correct.E) B) and D)
F) A) and C)

Question 17

Welfare economics is the study of how

Accepted Answer

A)   the allocation of resources affects economic well-being.
B)   a price ceiling compares to a price floor.
C)   the government helps poor people.
D)   a consumer's optimal choice affects her demand curve.E) C) and D)
F) None of the above

Question 18

Figure 7-3 
-Refer to Figure 7-3.Which area represents the increase in consumer surplus when the price falls from P1 to P2?

Accepted Answer

A)   ABD
B)   ACG
C)   DFG
D)   BCGDE) A) and D)
F) A) and C)

Question 19

Figure 7-3 
-Refer to Figure 7-3.When the price falls from P1 to P2,which area represents the increase in consumer surplus to existing buyers?

Accepted Answer

A)   ABD
B)   ACG
C)   BCFD
D)   DFGE) A) and D)
F) A) and B)

Question 20

Figure 7-10 
-Refer to Figure 7-10.If the equilibrium price is $50,what is the producer surplus?

Accepted Answer

A)   $625
B)   $3,750
C)   $5,625
D)   $10,000E) None of the above
F) All of the above

Exam 7: Consumers, producers, and the Efficiency of Markets

Consumer surplus is

Correct Answer
verified

Producer surplus directly measures

Correct Answer
verified

Economists typically measure efficiency using

Correct Answer
verified

Figure 7-10 -Refer to Figure 7-10.If the equilibrium price is $50,what is the producer surplus?

Correct Answer
verified

Welfare economics is the study of how

Correct Answer
verified

If Darby values a soccer ball at $50,and she pays $40 for it,her consumer surplus is $90.

Correct Answer
verified

Janine would be willing to pay $50 to see Les Misérables,but she buys a ticket for only $30.Janine values the performance at

Correct Answer
verified

If the cost of producing sofas decreases,then consumer surplus in the sofa market will

Correct Answer
verified

If Darby values a soccer ball at $50,and she pays $40 for it,her consumer surplus is $10.

Correct Answer
verified

Table 7-11 -Refer to Table 7-11.The equilibrium price is

Correct Answer
verified

Consumer surplus

Correct Answer
verified

Figure 7-3 -Refer to Figure 7-3.When the price falls from P1 to P2,which area represents the increase in consumer surplus to existing buyers?

Correct Answer
verified

Which of the following will cause a decrease in producer surplus?

Correct Answer
verified

Correct Answer
verified

Figure 7-18 -Refer to Figure 7-18.Assume demand increases and as a result,equilibrium price increases to $22 and equilibrium quantity increases to 110.The increase in producer surplus would be

Correct Answer
verified

Figure 7-3 -Refer to Figure 7-3.Which area represents the increase in consumer surplus when the price falls from P1 to P2?

Correct Answer
verified

Which of the following equations is not valid?

Correct Answer
verified

Cost is a measure of the

Correct Answer
verified

Table 7-7 The following table represents the costs of five possible sellers. -Refer to Table 7-7.If the market price is $1,100,the combined total cost of all participating sellers is

Correct Answer
verified

Figure 7-1 -Refer to Figure 7-1.If the price of the good is $200,then

Correct Answer
verified

Exam 7: Consumers, producers, and the Efficiency of Markets

Consumer surplus is

Correct AnswerverifiedShow Answer

Producer surplus directly measures

Correct AnswerverifiedShow Answer

Economists typically measure efficiency using

Correct AnswerverifiedShow Answer

Figure 7-10 -Refer to Figure 7-10.If the equilibrium price is $50,what is the producer surplus?

Correct AnswerverifiedShow Answer

Welfare economics is the study of how

Correct AnswerverifiedShow Answer

If Darby values a soccer ball at $50,and she pays $40 for it,her consumer surplus is $90.

Correct AnswerverifiedShow Answer

Janine would be willing to pay $50 to see Les Misérables,but she buys a ticket for only $30.Janine values the performance at

Correct AnswerverifiedShow Answer

If the cost of producing sofas decreases,then consumer surplus in the sofa market will

Correct AnswerverifiedShow Answer

If Darby values a soccer ball at $50,and she pays $40 for it,her consumer surplus is $10.

Correct AnswerverifiedShow Answer

Table 7-11 -Refer to Table 7-11.The equilibrium price is

Correct AnswerverifiedShow Answer

Consumer surplus

Correct AnswerverifiedShow Answer

Figure 7-3 -Refer to Figure 7-3.When the price falls from P1 to P2,which area represents the increase in consumer surplus to existing buyers?

Correct AnswerverifiedShow Answer

Which of the following will cause a decrease in producer surplus?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Figure 7-18 -Refer to Figure 7-18.Assume demand increases and as a result,equilibrium price increases to $22 and equilibrium quantity increases to 110.The increase in producer surplus would be

Correct AnswerverifiedShow Answer

Figure 7-3 -Refer to Figure 7-3.Which area represents the increase in consumer surplus when the price falls from P1 to P2?

Correct AnswerverifiedShow Answer

Which of the following equations is not valid?

Correct AnswerverifiedShow Answer

Cost is a measure of the

Correct AnswerverifiedShow Answer

Table 7-7 The following table represents the costs of five possible sellers. -Refer to Table 7-7.If the market price is $1,100,the combined total cost of all participating sellers is

Correct AnswerverifiedShow Answer

Figure 7-1 -Refer to Figure 7-1.If the price of the good is $200,then

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified