Question 1

Use the figure below to answer the following questions.   Figure 5.2.2
-Consider the demand curve in Figure 5.2.2.If the price rises from $4 to $11 a unit,consumer surplus

Accepted Answer

A) decreases by $73.50. 
B) increases by $73.50. 
C) decreases by $21.00. 
D) increases by $21.00. 
E) decreases by $24.50. 
A) decreases by $73.50. 
B) increases by $73.50. 
C) decreases by $21.00. 
D) increases by $21.00. 
E) decreases by $24.50.

Question 2

When a market price allocates a scarce resource,

Accepted Answer

A) everyone in the economy can use the resource. 
B) the richest people get the resource. 
C) willingness-to-pay is not an issue. 
D) ability to pay for the resource is less important than willingness-to-pay. 
E) only those who are willing and able to pay get the resource. 
A) everyone in the economy can use the resource. 
B) the richest people get the resource. 
C) willingness-to-pay is not an issue. 
D) ability to pay for the resource is less important than willingness-to-pay. 
E) only those who are willing and able to pay get the resource.

Question 3

Use the figure below to answer the following questions.   Figure 5.2.3
-Refer to Figure 5.2.3.If the price is P0,then the value of the last unit consumed is

Accepted Answer

A) P0. 
B) P1. 
C) equal to the consumer surplus on the last unit consumed. 
D) 0. 
E) P1- P0. 
A) P0. 
B) P1. 
C) equal to the consumer surplus on the last unit consumed. 
D) 0. 
E) P1- P0.

Question 4

The demand curve for a good is the same as the

Accepted Answer

A) marginal cost curve of that good. 
B) marginal benefit curve for that good. 
C) y-axis when the price of the good is constant. 
D) production possibilities frontier (PPF). 
E) marginal benefit curve for that good when marginal cost is constant. 
A) marginal cost curve of that good. 
B) marginal benefit curve for that good. 
C) y-axis when the price of the good is constant. 
D) production possibilities frontier (PPF). 
E) marginal benefit curve for that good when marginal cost is constant.

Question 5

Use the figure below to answer the following questions.   Figure 5.3.1
-Refer to Figure 5.3.1.At the efficient quantity,the price is

Accepted Answer

A) $20 a unit. 
B) $15 a unit. 
C) $10 a unit. 
D) $5 a unit. 
E) zero. 
A) $20 a unit. 
B) $15 a unit. 
C) $10 a unit. 
D) $5 a unit. 
E) zero.

Question 6

The marginal cost of producing an oil painting is $1,000.The painting sold for $1,500.How much producer surplus did the painter receive?

Accepted Answer

A) $1,500 
B) $1,000 
C) $500 
D) zero 
E) $2,500 
A) $1,500 
B) $1,000 
C) $500 
D) zero 
E) $2,500

Question 7

In the Canadian economy,the command system is

Accepted Answer

A) not used at all. 
B) used occasionally inside firms and government departments. 
C) used only by private companies. 
D) used extensively in place of markets. 
E) used extensively inside firms and government departments. 
A) not used at all. 
B) used occasionally inside firms and government departments. 
C) used only by private companies. 
D) used extensively in place of markets. 
E) used extensively inside firms and government departments.

Question 8

In 2017,a severe drought led to an increase in the price of corn.Farmer Lyle was not affected by the drought.In 2016 there was no drought.In 2017,Farmer Lyle's

Accepted Answer

A) consumer surplus increased. 
B) producer surplus increased. 
C) producer surplus increased and his consumer surplus increased. 
D) consumer surplus decreased and his producer surplus increased. 
E) supply of corn became perfectly elastic. 
A) consumer surplus increased. 
B) producer surplus increased. 
C) producer surplus increased and his consumer surplus increased. 
D) consumer surplus decreased and his producer surplus increased. 
E) supply of corn became perfectly elastic.

Question 9

Use the figure below to answer the following questions.   Figure 5.3.1
-Refer to Figure 5.3.1.If the quantity produced is 200,

Accepted Answer

A) a deadweight loss exists. 
B) the sum of consumer surplus and producer surplus is maximized. 
C) production is efficient. 
D) the sum of consumer surplus and producer surplus is zero. 
E) deadweight loss is minimized. 
A) a deadweight loss exists. 
B) the sum of consumer surplus and producer surplus is maximized. 
C) production is efficient. 
D) the sum of consumer surplus and producer surplus is zero. 
E) deadweight loss is minimized.

Question 10

If resources are allocated efficiently,

Accepted Answer

A) consumer surplus exceeds producer surplus. 
B) producer surplus exceeds consumer surplus. 
C) the sum of consumer surplus and producer surplus is maximized. 
D) marginal social benefit is maximized. 
E) marginal social cost is minimized. 
A) consumer surplus exceeds producer surplus. 
B) producer surplus exceeds consumer surplus. 
C) the sum of consumer surplus and producer surplus is maximized. 
D) marginal social benefit is maximized. 
E) marginal social cost is minimized.

Question 11

Use the figure below to answer the following questions.     Figure 5.2.5a Figure 5.2.5b
-Refer to Figure 5.2.5.If the price of a pizza is $30,what is the producer surplus in the market if Pizza House and Pizza Club are the only firms?

Accepted Answer

A) $625 
B) $500 
C) $25 
D) $2,250 
E) $1,125 
A) $625 
B) $500 
C) $25 
D) $2,250 
E) $1,125

Question 12

Suppose the market for diamonds is a monopoly.We can expect

Accepted Answer

A) underproduction of diamonds. 
B) overproduction of diamonds. 
C) marginal social benefit to equal marginal social cost in the diamond market. 
D) an efficient quantity of diamonds. 
E) the allocation of diamonds to be first-come,first-served. 
A) underproduction of diamonds. 
B) overproduction of diamonds. 
C) marginal social benefit to equal marginal social cost in the diamond market. 
D) an efficient quantity of diamonds. 
E) the allocation of diamonds to be first-come,first-served.

Question 13

If a firm produces one more bottle of water,

Accepted Answer

A) the outcome is inefficient. 
B) the firm incurs a marginal cost. 
C) the market for bottled water is no longer in equilibrium. 
D) the price of a bottle of water must rise. 
E) the marginal social benefit from bottled water increases. 
A) the outcome is inefficient. 
B) the firm incurs a marginal cost. 
C) the market for bottled water is no longer in equilibrium. 
D) the price of a bottle of water must rise. 
E) the marginal social benefit from bottled water increases.

Question 14

An idea of fairness that emphasizes equality of opportunity is

Accepted Answer

A) fair results. 
B) fair rules. 
C) fair incomes. 
D) utilitarianism. 
E) modified utilitarianism. 
A) fair results. 
B) fair rules. 
C) fair incomes. 
D) utilitarianism. 
E) modified utilitarianism.

Question 15

One big problem with the utilitarian ideal is that it

Accepted Answer

A) ignores fairness. 
B) ignores equality. 
C) ignores the costs of making income transfers. 
D) all of the above 
E) none of the above 
A) ignores fairness. 
B) ignores equality. 
C) ignores the costs of making income transfers. 
D) all of the above 
E) none of the above

Question 16

Consumer surplus is

Accepted Answer

A) the difference between the maximum price consumers are willing to pay and the minimum price producers are willing to accept. 
B) the excess of the benefit received from a good over the amount paid for it. 
C) the total value to consumers of a good. 
D) equal to the area under the demand curve. 
E) the total amount paid for a good. 
A) the difference between the maximum price consumers are willing to pay and the minimum price producers are willing to accept. 
B) the excess of the benefit received from a good over the amount paid for it. 
C) the total value to consumers of a good. 
D) equal to the area under the demand curve. 
E) the total amount paid for a good.

Question 17

Use the figure below to answer the following questions.   Figure 5.2.6
-Figure 5.2.6 shows the supply curve of DVD rentals for Morgan's Marvellous Movies.If the price of a rental is $5,what is Morgan's producer surplus?

Accepted Answer

A) $4.50 
B) $2.25 
C) $15.00 
D) $5.00 
E) $24.50 
A) $4.50 
B) $2.25 
C) $15.00 
D) $5.00 
E) $24.50

Question 18

When a scarce resource is allocated to someone who is the winner,the method of resource allocation is

Accepted Answer

A) majority rule. 
B) a contest. 
C) first-come,first-served. 
D) force. 
E) personal characteristics. 
A) majority rule. 
B) a contest. 
C) first-come,first-served. 
D) force. 
E) personal characteristics.

Question 19

A consumer will buy a good when

Accepted Answer

A) consumer surplus is greater than or equal to the price. 
B) marginal benefit is positive. 
C) marginal benefit is greater than or equal to the price. 
D) consumer surplus is positive. 
E) consumer surplus is greater than producer surplus. 
A) consumer surplus is greater than or equal to the price. 
B) marginal benefit is positive. 
C) marginal benefit is greater than or equal to the price. 
D) consumer surplus is positive. 
E) consumer surplus is greater than producer surplus.

Question 20

The main idea of fairness is based on which of the following rules? a.The state must enforce laws that establish and protect private property.
B.Goods and services that produce externalities must be owned by the state,monopolies must be eliminated,and common resources must follow the rules of the competitive market.
C.The state must enforce tax laws so that after taxes are paid and benefits are received,the gap between rich and poor is as small as possible.
D.Private property may be transferred from one person to another only by voluntary exchange.

Accepted Answer

A) Rules a and d 
B) Rules b and d 
C) Rules b and c 
D) Rules a and c 
E) The main idea of fairness is not based on any of these rules. 
A) Rules a and d 
B) Rules b and d 
C) Rules b and c 
D) Rules a and c 
E) The main idea of fairness is not based on any of these rules.

Use the figure below to answer the following questions. Figure 5.2.2 -Consider the demand curve in Figure 5.2.2.If the price rises from $4 to $11 a unit,consumer surplus

When a market price allocates a scarce resource,

Use the figure below to answer the following questions. Figure 5.2.3 -Refer to Figure 5.2.3.If the price is P₀,then the value of the last unit consumed is

The demand curve for a good is the same as the

Use the figure below to answer the following questions. Figure 5.3.1 -Refer to Figure 5.3.1.At the efficient quantity,the price is

The marginal cost of producing an oil painting is $1,000.The painting sold for $1,500.How much producer surplus did the painter receive?

In the Canadian economy,the command system is

In 2017,a severe drought led to an increase in the price of corn.Farmer Lyle was not affected by the drought.In 2016 there was no drought.In 2017,Farmer Lyle's

Use the figure below to answer the following questions. Figure 5.3.1 -Refer to Figure 5.3.1.If the quantity produced is 200,

If resources are allocated efficiently,

Use the figure below to answer the following questions. Figure 5.2.5a Figure 5.2.5b -Refer to Figure 5.2.5.If the price of a pizza is $30,what is the producer surplus in the market if Pizza House and Pizza Club are the only firms?

Suppose the market for diamonds is a monopoly.We can expect

If a firm produces one more bottle of water,

An idea of fairness that emphasizes equality of opportunity is

One big problem with the utilitarian ideal is that it

Consumer surplus is

Use the figure below to answer the following questions. Figure 5.2.6 -Figure 5.2.6 shows the supply curve of DVD rentals for Morgan's Marvellous Movies.If the price of a rental is $5,what is Morgan's producer surplus?

When a scarce resource is allocated to someone who is the winner,the method of resource allocation is

A consumer will buy a good when

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, preferences, and Choices

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Public Goods and Common Resources

Markets for Factors of Production

Economic Inequality

Filters

Exam 5: Efficiency and Equity

Use the figure below to answer the following questions. Figure 5.2.2 -Consider the demand curve in Figure 5.2.2.If the price rises from $4 to $11 a unit,consumer surplus

When a market price allocates a scarce resource,

Use the figure below to answer the following questions. Figure 5.2.3 -Refer to Figure 5.2.3.If the price is P0,then the value of the last unit consumed is

The demand curve for a good is the same as the

Use the figure below to answer the following questions. Figure 5.3.1 -Refer to Figure 5.3.1.At the efficient quantity,the price is

The marginal cost of producing an oil painting is $1,000.The painting sold for $1,500.How much producer surplus did the painter receive?

In the Canadian economy,the command system is

In 2017,a severe drought led to an increase in the price of corn.Farmer Lyle was not affected by the drought.In 2016 there was no drought.In 2017,Farmer Lyle's

Use the figure below to answer the following questions. Figure 5.3.1 -Refer to Figure 5.3.1.If the quantity produced is 200,

If resources are allocated efficiently,

Use the figure below to answer the following questions. Figure 5.2.5a Figure 5.2.5b -Refer to Figure 5.2.5.If the price of a pizza is $30,what is the producer surplus in the market if Pizza House and Pizza Club are the only firms?

Suppose the market for diamonds is a monopoly.We can expect

If a firm produces one more bottle of water,

An idea of fairness that emphasizes equality of opportunity is

One big problem with the utilitarian ideal is that it

Consumer surplus is

Use the figure below to answer the following questions. Figure 5.2.6 -Figure 5.2.6 shows the supply curve of DVD rentals for Morgan's Marvellous Movies.If the price of a rental is $5,what is Morgan's producer surplus?

When a scarce resource is allocated to someone who is the winner,the method of resource allocation is

A consumer will buy a good when

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, preferences, and Choices

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Public Goods and Common Resources

Markets for Factors of Production

Economic Inequality

Filters

Use the figure below to answer the following questions. Figure 5.2.3 -Refer to Figure 5.2.3.If the price is P₀,then the value of the last unit consumed is