Exam 3: Business Fluctuations: Aggregate Demand and Supply

Reference: Ref 3-3 (Table: Willingness to Sell) Refer to the table. Which country is earning the most producer surplus at a market price of $35 per barrel of oil?

Reference: Ref 3-1 (Table: Sweetbrand) The table shows the maximum consumer willingness to pay for "Sweetbrand" cheesecakes. Which of the four consumers receives the most consumer surplus, if the market price of the cheesecakes is $12.50 each?

Mario buys eight units of good X when his income is $2,000 a month. When his income increases to $2,700 per month, he buys only six units of good X. For Mario, good X is:

A local university decides to double its enrollment over the next five years in order to increase tuition revenue. Which of the following would most likely occur in the market for rental housing in the surrounding community?

Which of the following factors causes a decrease in supply?

A subsidy is a:

New research indicates that running marathons is actually bad for the heart (it increases inflammatory markers associated with heart attacks). This news will:

In the market for fertilizer, an:

Reference: Ref 3-2 (Figure: Producer Surplus) Refer to the figure. What is the change in producer surplus if the price rises from $2 to $3 per unit?

The quantity supplied is the:

If Maria is willing to pay $50 for a sweatshirt, how much consumer surplus does she earn if the market price for sweatshirts is $27.50 each?

(Figure: Oil Market) Refer to the figure. Which of the following events could cause the change in the figure?

Consumer surplus can be defined as the net benefit to consumers from participating in a market.

(Table: Barrels of Oil) Refer to the table. What is the total amount of producer surplus (per barrel of oil) earned by all four producers if the market price per barrel of oil is $51? Table: Barrels of Oil Minimum willingness to sell

Suppose that the market price for MP3 players is $90 and MP3 players can be produced by firm X for $40 each. Producer surplus for this firm is $50 per MP3 player.

What is the difference between a change in Quantity Supplied (Qs) and a change in Supply (S)? Explain what causes a change in Qs, and what causes a change in S, and illustrate using graphs.

The law of demand states that:

NAFTA increased the supply curve of lumber in the United States.

The quantity supplied of oil is the amount that:

An increase in income increases the demand for normal goods.