Question 1

What is the relationship between the marginal social benefit of milk and marginal social cost of milk when the efficient quantity of milk is produced?

Accepted Answer

The marginal social

Question 2

The table below shows the demand schedules for pizza for Abby and Barry who are the only buyers in the market.
  
-Based on the table, what is Abby's marginal benefit from the 10th slice of pizza?

Accepted Answer

A)  $4 
B)  $13 
C)  $0.50 
D)  $40 
A)  $4 
B)  $13 
C)  $0.50 
D)  $40

Question 3

Fitness is a magazine for women about health and exercise. Fitness offers year subscriptions for $12 on their website. Jess, Ania, Mandy, and Chloe exercise together and each enjoy reading Fitness. Jess is willing to pay $10, Ania is willing to pay $16, Mandy is willing to pay $24, and Chloe is willing to pay $12 for a subscription to the magazine. What is the value of Chloe's consumer surplus?

Accepted Answer

A)  $0 
B)  $12 
C)  $10 
D)  Chloe will not purchase the magazine. 
A)  $0 
B)  $12 
C)  $10 
D)  Chloe will not purchase the magazine.

Question 4

-The above figure shows the marginal social benefit and marginal social cost curves of coffee in the nation of Kaffenia. Which of the following would result in the quantity of coffee in Kaffenia differing from the efficient quantity?

Accepted Answer

A)  The existence of a single producer and seller of coffee. 
B)  The existence of many producers and sellers of coffee. 
C)  Damage to the environment from fumes emitted by coffee beans. 
D)  Both answers A and C are correct. 
A)  The existence of a single producer and seller of coffee. 
B)  The existence of many producers and sellers of coffee. 
C)  Damage to the environment from fumes emitted by coffee beans. 
D)  Both answers A and C are correct.

Question 5

-The above figure illustrates the marginal social benefit and marginal social cost for chicken sandwiches. If the quantity is decreased from 6 to 3 and the price increases from $3 to $4, consumer surplus will decrease by

Accepted Answer

A)  $1.50. 
B)  $2.00. 
C)  $3.00. 
D)  $4.50. 
A)  $1.50. 
B)  $2.00. 
C)  $3.00. 
D)  $4.50.

Question 6

-In the above figure, when the price of pretzels is $3.00 per pound, the total producer surplus from all the pretzels will be

Accepted Answer

A)  zero. 
B)  greater than at any other price. 
C)  less than at any other price. 
D)  the sum of the difference between $3.00 and the marginal cost of all the pounds produced. 
A)  zero. 
B)  greater than at any other price. 
C)  less than at any other price. 
D)  the sum of the difference between $3.00 and the marginal cost of all the pounds produced.

Question 7

The pollution created when coal is burned by utilities to generate electricity is an example of

Accepted Answer

A)  a marginal benefit to coal producers. 
B)  a welfare cost. 
C)  an external cost. 
D)  a cost paid by the utilities. 
A)  a marginal benefit to coal producers. 
B)  a welfare cost. 
C)  an external cost. 
D)  a cost paid by the utilities.

Question 8

Marginal cost is best defined as

Accepted Answer

A)  the extra cost of producing one more unit of output. 
B)  the profit earned from selling one more unit of output. 
C)  the price received from selling one more unit of output. 
D)  equal to producer surplus. 
A)  the extra cost of producing one more unit of output. 
B)  the profit earned from selling one more unit of output. 
C)  the price received from selling one more unit of output. 
D)  equal to producer surplus.

Question 9

-The above figure shows the marginal social benefit and marginal social cost curves of doughnuts in the nation of Kaffenia. What is the marginal social benefit from the 300th dozen doughnuts each day?

Accepted Answer

A)  $10.00 per dozen 
B)  $8.00 per dozen 
C)  $6.00 per dozen 
D)  $4.00 per dozen 
A)  $10.00 per dozen 
B)  $8.00 per dozen 
C)  $6.00 per dozen 
D)  $4.00 per dozen

Question 10

Which of the following statements is FALSE?

Accepted Answer

A)  The value of one more unit of a good is the good's marginal benefit. 
B)  A good's marginal benefit is the maximum price people are willing to pay for another unit. 
C)  The maximum price people are willing to pay for one more unit of a good is its value. 
D)  None of the above because all the statements are true. 
A)  The value of one more unit of a good is the good's marginal benefit. 
B)  A good's marginal benefit is the maximum price people are willing to pay for another unit. 
C)  The maximum price people are willing to pay for one more unit of a good is its value. 
D)  None of the above because all the statements are true.

Question 11

-The figure above shows the market for coffee. If 10 million pounds of coffee a month are available, the ________ price that consumers are willing to pay for the last pound is ________.

Accepted Answer

A)  maximum; $2.00 
B)  maximum; $3.50 
C)  minimum; $2.00 
D)  minimum; $3.50 
A)  maximum; $2.00 
B)  maximum; $3.50 
C)  minimum; $2.00 
D)  minimum; $3.50

Question 12

Which of the following is inconsistent with Robert Nozick's view of fairness as expressed in his book Anarchy, State, and Utopia?

Accepted Answer

A)  Everything that is valuable must be owned by individuals and that the state must ensure that theft is prevented. 
B)  The only legitimate way a person can acquire property is to buy it. 
C)  The requirement that all people should have equal outcomes. 
D)  None of the above answers is correct because all the answers express thoughts consistent with Nozick's view. 
A)  Everything that is valuable must be owned by individuals and that the state must ensure that theft is prevented. 
B)  The only legitimate way a person can acquire property is to buy it. 
C)  The requirement that all people should have equal outcomes. 
D)  None of the above answers is correct because all the answers express thoughts consistent with Nozick's view.

Question 13

-Which area in the above figure is the deadweight loss if 100 snowboards are produced?

Accepted Answer

A)  A + B + C 
B)  D + E + F 
C)  C + E 
D)  There is no deadweight loss when 100 snowboards are produced. 
A)  A + B + C 
B)  D + E + F 
C)  C + E 
D)  There is no deadweight loss when 100 snowboards are produced.

Question 14

When the efficient quantity of output is produced

Accepted Answer

A)  the marginal social benefit of the last unit produced is equal to the marginal social cost of the last unit produced. 
B)  the sum of consumer surplus and producer surplus is maximized. 
C)  resources are used in the activities in which they are most highly valued. 
D)  All of the above answers are correct. 
A)  the marginal social benefit of the last unit produced is equal to the marginal social cost of the last unit produced. 
B)  the sum of consumer surplus and producer surplus is maximized. 
C)  resources are used in the activities in which they are most highly valued. 
D)  All of the above answers are correct.

Question 15

Suppose a country produces only bikes and clothing. The country achieves an efficient allocation of resources when

Accepted Answer

A)  it can't produce any more bikes unless it gives up clothing. 
B)  it produces equal amount of bikes and clothes. 
C)  the marginal social benefit of producing a bike equals the marginal social cost of producing a bike. 
D)  the prices charged for the goods are as low as possible. 
A)  it can't produce any more bikes unless it gives up clothing. 
B)  it produces equal amount of bikes and clothes. 
C)  the marginal social benefit of producing a bike equals the marginal social cost of producing a bike. 
D)  the prices charged for the goods are as low as possible.

Question 16

The decrease in consumer surplus and producer surplus that results from an inefficient level of production is called the

Accepted Answer

A)  external cost. 
B)  external benefit. 
C)  deadweight loss. 
D)  big tradeoff. 
A)  external cost. 
B)  external benefit. 
C)  deadweight loss. 
D)  big tradeoff.

Question 17

In the market for DVDs, 500,000 DVDs a month are available. The value people place on the 500,000th DVD a month is less than the marginal social cost of producing it. Resource use

Accepted Answer

A)  is efficient. 
B)  is inefficient. 
C)  would be more efficient if people firms would produce more DVDs. 
D)  would be more efficient if people would buy more DVDs. 
A)  is efficient. 
B)  is inefficient. 
C)  would be more efficient if people firms would produce more DVDs. 
D)  would be more efficient if people would buy more DVDs.

Question 18

-In the above figure, what is the amount of consumer surplus at the efficient quantity?

Accepted Answer

A)  $0 
B)  $1,000 
C)  $2,000 
D)  $4,000 
A)  $0 
B)  $1,000 
C)  $2,000 
D)  $4,000

Question 19

-In the above figure, as output increases from 0 units to 10 units to 20 units to 30 units, the deadweight loss

Accepted Answer

A)  falls. 
B)  falls at first, then rises. 
C)  rises. 
D)  rises at first, then falls. 
A)  falls. 
B)  falls at first, then rises. 
C)  rises. 
D)  rises at first, then falls.

Question 20

The reduction in consumer and producer surplus that results from underproduction is called

Accepted Answer

A)  an internal cost. 
B)  a deadweight loss. 
C)  a quantity loss. 
D)  None of the above answers is correct. 
A)  an internal cost. 
B)  a deadweight loss. 
C)  a quantity loss. 
D)  None of the above answers is correct.

What is the relationship between the marginal social benefit of milk and marginal social cost of milk when the efficient quantity of milk is produced?

The table below shows the demand schedules for pizza for Abby and Barry who are the only buyers in the market. -Based on the table, what is Abby's marginal benefit from the 10th slice of pizza?

-The above figure shows the marginal social benefit and marginal social cost curves of coffee in the nation of Kaffenia. Which of the following would result in the quantity of coffee in Kaffenia differing from the efficient quantity?

-The above figure illustrates the marginal social benefit and marginal social cost for chicken sandwiches. If the quantity is decreased from 6 to 3 and the price increases from $3 to $4, consumer surplus will decrease by

-In the above figure, when the price of pretzels is $3.00 per pound, the total producer surplus from all the pretzels will be

The pollution created when coal is burned by utilities to generate electricity is an example of

Marginal cost is best defined as

-The above figure shows the marginal social benefit and marginal social cost curves of doughnuts in the nation of Kaffenia. What is the marginal social benefit from the 300th dozen doughnuts each day?

Which of the following statements is FALSE?

-The figure above shows the market for coffee. If 10 million pounds of coffee a month are available, the price that consumers are willing to pay for the last pound is .

Which of the following is inconsistent with Robert Nozick's view of fairness as expressed in his book Anarchy, State, and Utopia?

-Which area in the above figure is the deadweight loss if 100 snowboards are produced?

When the efficient quantity of output is produced

Suppose a country produces only bikes and clothing. The country achieves an efficient allocation of resources when

The decrease in consumer surplus and producer surplus that results from an inefficient level of production is called the

In the market for DVDs, 500,000 DVDs a month are available. The value people place on the 500,000th DVD a month is less than the marginal social cost of producing it. Resource use

-In the above figure, what is the amount of consumer surplus at the efficient quantity?

-In the above figure, as output increases from 0 units to 10 units to 20 units to 30 units, the deadweight loss

The reduction in consumer and producer surplus that results from underproduction is called

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Public Choices, Public Goods, and Healthcare

Externalities

Markets for Factors of Production

Economic Inequality

Uncertainty and Information

Filters

Exam 5: Efficiency and Equity

What is the relationship between the marginal social benefit of milk and marginal social cost of milk when the efficient quantity of milk is produced?

The table below shows the demand schedules for pizza for Abby and Barry who are the only buyers in the market. -Based on the table, what is Abby's marginal benefit from the 10th slice of pizza?

-The above figure shows the marginal social benefit and marginal social cost curves of coffee in the nation of Kaffenia. Which of the following would result in the quantity of coffee in Kaffenia differing from the efficient quantity?

-The above figure illustrates the marginal social benefit and marginal social cost for chicken sandwiches. If the quantity is decreased from 6 to 3 and the price increases from $3 to $4, consumer surplus will decrease by

-In the above figure, when the price of pretzels is $3.00 per pound, the total producer surplus from all the pretzels will be

The pollution created when coal is burned by utilities to generate electricity is an example of

Marginal cost is best defined as

-The above figure shows the marginal social benefit and marginal social cost curves of doughnuts in the nation of Kaffenia. What is the marginal social benefit from the 300th dozen doughnuts each day?

Which of the following statements is FALSE?

-The figure above shows the market for coffee. If 10 million pounds of coffee a month are available, the ________ price that consumers are willing to pay for the last pound is ________.

Which of the following is inconsistent with Robert Nozick's view of fairness as expressed in his book Anarchy, State, and Utopia?

-Which area in the above figure is the deadweight loss if 100 snowboards are produced?

When the efficient quantity of output is produced

Suppose a country produces only bikes and clothing. The country achieves an efficient allocation of resources when

The decrease in consumer surplus and producer surplus that results from an inefficient level of production is called the

In the market for DVDs, 500,000 DVDs a month are available. The value people place on the 500,000th DVD a month is less than the marginal social cost of producing it. Resource use

-In the above figure, what is the amount of consumer surplus at the efficient quantity?

-In the above figure, as output increases from 0 units to 10 units to 20 units to 30 units, the deadweight loss

The reduction in consumer and producer surplus that results from underproduction is called

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Public Choices, Public Goods, and Healthcare

Externalities

Markets for Factors of Production

Economic Inequality

Uncertainty and Information

Filters

-The figure above shows the market for coffee. If 10 million pounds of coffee a month are available, the price that consumers are willing to pay for the last pound is .