Exam 5: Efficiency and Equity

Four people each have a different willingness to pay for one unit of a good: George will pay $15, Glen will pay $12, Tom will pay $10, and Peter will pay $8. If price is equal to $9 per unit then the quantity demanded in the market will be ________ and the consumer surplus for this unit will be ________.

-The figure above shows the market supply and market demand curves for pizza. If the market is at its equilibrium, what area in the graph above represents: a) consumer surplus? b) producer surplus?

What are the two views of fairness? How does each view redistribution of income from the rich to the poor?

-The figure above shows the market for milk. If the efficient quantity of milk is produced, the consumer surplus is

-The above figure shows the marginal social benefit and marginal social cost curves of doughnuts in the nation of Kaffenia. What is the efficient quantity of doughnuts to produce each day?

Deadweight loss is the decrease in ________ from producing an inefficient amount of a product.

-The figure above shows the market for coffee. If one firm owns all the coffee outlets and sells 10 million pounds of coffee a month, the deadweight loss is

-In the above figure, what is the efficient quantity of hot dogs to produce?

-The figure above shows the market for coffee. If more coffee plantations are planted in Brazil and Vietnam so that the supply of coffee increases, the efficient quantity of coffee will ________ and the consumer surplus will ________.