Question 1

-In the above figure, if the market produces the efficient amount of purses then producer surplus equals triangle

Accepted Answer

A)  abc. 
B)  bcd. 
C)  adc. 
D)  dce. 
A)  abc. 
B)  bcd. 
C)  adc. 
D)  dce.

Question 2

-In the above table, what is the maximum price that consumers are willing to pay for the 200th brownie?

Accepted Answer

A)  0 
B)  20¢ 
C)  60¢ 
D)  80¢ 
A)  0 
B)  20¢ 
C)  60¢ 
D)  80¢

Question 3

Allocating resources by the order of someone in authority is a ________ allocation method.

Accepted Answer

A)  first-come, first-served 
B)  market price 
C)  majority rule 
D)  command 
A)  first-come, first-served 
B)  market price 
C)  majority rule 
D)  command

Question 4

Jane is willing to pay $80 for a pair of shoes. The actual price of the shoes is $50. Her marginal benefit from the pair of shoes is

Accepted Answer

A)  $80. 
B)  $30. 
C)  $50. 
D)  $1300. 
A)  $80. 
B)  $30. 
C)  $50. 
D)  $1300.

Question 5

-The figure above shows the market for milk. The ________ price that producers must be offered to get them to produce 250 gallons of milk per day is ________.

Accepted Answer

A)  maximum; $3.25 
B)  minimum; $3.25 
C)  maximum; $2.50 
D)  minimum; $2.50 
A)  maximum; $3.25 
B)  minimum; $3.25 
C)  maximum; $2.50 
D)  minimum; $2.50

Question 6

"If the price of a ticket to Sea World exceeds the marginal cost of the ticket by $13, a producer surplus exists for Sea World." Is this statement true or false?

Accepted Answer

The statement is true. Anytime

Question 7

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 Barry's marginal benefit from the 40th slice of pizza?

Accepted Answer

A)  $3 
B)  $5.50 
C)  $0.50 
D)  $12 
A)  $3 
B)  $5.50 
C)  $0.50 
D)  $12

Question 8

-In the above figure, if output is 10 units, then the total deadweight loss is

Accepted Answer

A)  $5. 
B)  $10. 
C)  $20. 
D)  $60. 
A)  $5. 
B)  $10. 
C)  $20. 
D)  $60.

Question 9

Jane is willing to pay $50 for a pair of shoes. The actual price of the shoes is $30. Her consumer surplus on this pair of shoes is

Accepted Answer

A)  $20. 
B)  $50. 
C)  $30. 
D)  $80. 
A)  $20. 
B)  $50. 
C)  $30. 
D)  $80.

Question 10

Which of the following is a CORRECT statement?

Accepted Answer

A)  Producer surplus is an external benefit. 
B)  Consumer surplus is an external benefit. 
C)  A government subsidy paid to a producer is an external benefit. 
D)  None of the above statements are correct. 
A)  Producer surplus is an external benefit. 
B)  Consumer surplus is an external benefit. 
C)  A government subsidy paid to a producer is an external benefit. 
D)  None of the above statements are correct.

Question 11

In 2012 a severe drought raised the price of corn. For a farmer in Canada who harvested a normal crop because the farm was not affected directly by the drought, the increase in the price of corn

Accepted Answer

A)  increases the farmer's producer surplus. 
B)  decreases the farmer's producer surplus. 
C)  does not affect the producer surplus because this change is a movement along the farmer's supply curve and not a shift of the farmer's supply curve. 
D)  increases producer surplus only if the farmer's supply is completely inelastic. 
A)  increases the farmer's producer surplus. 
B)  decreases the farmer's producer surplus. 
C)  does not affect the producer surplus because this change is a movement along the farmer's supply curve and not a shift of the farmer's supply curve. 
D)  increases producer surplus only if the farmer's supply is completely inelastic.

Question 12

Resource use is efficient when

Accepted Answer

A)  marginal social benefit exceeds marginal social cost. 
B)  marginal social cost is decreasing. 
C)  marginal social benefit equals marginal social cost. 
D)  marginal social benefit is increasing. 
A)  marginal social benefit exceeds marginal social cost. 
B)  marginal social cost is decreasing. 
C)  marginal social benefit equals marginal social cost. 
D)  marginal social benefit is increasing.

Question 13

What are some of the potential obstacles that can prevent a market from reaching the efficient outcome? Briefly define each obstacle.

Accepted Answer

With one exception, the obstacles basica

Question 14

When a deadweight loss occurs in a market, we can be certain that

Accepted Answer

A)  taxes have been imposed in a market. 
B)  the market is a monopoly. 
C)  there underproduction in the market. 
D)  the entire society experiences a loss. 
A)  taxes have been imposed in a market. 
B)  the market is a monopoly. 
C)  there underproduction in the market. 
D)  the entire society experiences a loss.

Question 15

A market demand curve is constructed by

Accepted Answer

A)  a horizontal summation of each individual demand curve. 
B)  averaging each individual demand curve. 
C)  dividing one individual demand curve by the number of consumers in the market. 
D)  a vertical summation of each individual demand curve. 
A)  a horizontal summation of each individual demand curve. 
B)  averaging each individual demand curve. 
C)  dividing one individual demand curve by the number of consumers in the market. 
D)  a vertical summation of each individual demand curve.

Question 16

By reducing its output compared to a competitive market, a monopoly leads to

Accepted Answer

A)  a more efficient use of resources. 
B)  external benefits. 
C)  external costs. 
D)  a deadweight loss. 
A)  a more efficient use of resources. 
B)  external benefits. 
C)  external costs. 
D)  a deadweight loss.

Question 17

The table below shows the supply schedules for Fred's Pizza and Johnny's Pizza, the only sellers of pizza in the market.
  
-Using the table, Fred's marginal cost of the 200th slice of pizza is

Accepted Answer

A)  $2.50. 
B)  $6. 
C)  $0.50. 
D)  $20. 
A)  $2.50. 
B)  $6. 
C)  $0.50. 
D)  $20.

Question 18

Which of the following is TRUE?

Accepted Answer

A)  When a market price allocates resources, everyone who is able to pay the price gets the resource. 
B)  A command system works well when the lines of authority and responsibility are clear. 
C)  When the government decides how to allocate tax dollars among competing uses, resources are allocated by command. 
D)  When a manager offers everyone in the company the opportunity to win a prize, resources are allocated by a market price. 
A)  When a market price allocates resources, everyone who is able to pay the price gets the resource. 
B)  A command system works well when the lines of authority and responsibility are clear. 
C)  When the government decides how to allocate tax dollars among competing uses, resources are allocated by command. 
D)  When a manager offers everyone in the company the opportunity to win a prize, resources are allocated by a market price.

Question 19

-The figure above shows the market for milk. If a drought lowers the productivity of dairy cows so that they give less milk, then the efficient quantity of milk ________ and the consumer surplus ________.

Accepted Answer

A)  increases; increases 
B)  increases; decreases 
C)  decreases; increases 
D)  decreases; decreases 
A)  increases; increases 
B)  increases; decreases 
C)  decreases; increases 
D)  decreases; decreases

Question 20

-In the above figure, when the efficient quantity is produced the marginal social cost of the last magazine is

Accepted Answer

A)  $1. 
B)  $3. 
C)  $5. 
D)  some amount not given in the above three answers. 
A)  $1. 
B)  $3. 
C)  $5. 
D)  some amount not given in the above three answers.

-In the above figure, if the market produces the efficient amount of purses then producer surplus equals triangle

-In the above table, what is the maximum price that consumers are willing to pay for the 200th brownie?

Allocating resources by the order of someone in authority is a ________ allocation method.

Jane is willing to pay $80 for a pair of shoes. The actual price of the shoes is $50. Her marginal benefit from the pair of shoes is

-The figure above shows the market for milk. The price that producers must be offered to get them to produce 250 gallons of milk per day is .

"If the price of a ticket to Sea World exceeds the marginal cost of the ticket by $13, a producer surplus exists for Sea World." Is this statement true or false?

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 Barry's marginal benefit from the 40th slice of pizza?

-In the above figure, if output is 10 units, then the total deadweight loss is

Jane is willing to pay $50 for a pair of shoes. The actual price of the shoes is $30. Her consumer surplus on this pair of shoes is

Which of the following is a CORRECT statement?

In 2012 a severe drought raised the price of corn. For a farmer in Canada who harvested a normal crop because the farm was not affected directly by the drought, the increase in the price of corn

Resource use is efficient when

What are some of the potential obstacles that can prevent a market from reaching the efficient outcome? Briefly define each obstacle.

When a deadweight loss occurs in a market, we can be certain that

A market demand curve is constructed by

By reducing its output compared to a competitive market, a monopoly leads to

The table below shows the supply schedules for Fred's Pizza and Johnny's Pizza, the only sellers of pizza in the market. -Using the table, Fred's marginal cost of the 200th slice of pizza is

Which of the following is TRUE?

-The figure above shows the market for milk. If a drought lowers the productivity of dairy cows so that they give less milk, then the efficient quantity of milk and the consumer surplus .

-In the above figure, when the efficient quantity is produced the marginal social cost of the last magazine is

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

-In the above figure, if the market produces the efficient amount of purses then producer surplus equals triangle

-In the above table, what is the maximum price that consumers are willing to pay for the 200th brownie?

Allocating resources by the order of someone in authority is a ________ allocation method.

Jane is willing to pay $80 for a pair of shoes. The actual price of the shoes is $50. Her marginal benefit from the pair of shoes is

-The figure above shows the market for milk. The ________ price that producers must be offered to get them to produce 250 gallons of milk per day is ________.

"If the price of a ticket to Sea World exceeds the marginal cost of the ticket by $13, a producer surplus exists for Sea World." Is this statement true or false?

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 Barry's marginal benefit from the 40th slice of pizza?

-In the above figure, if output is 10 units, then the total deadweight loss is

Jane is willing to pay $50 for a pair of shoes. The actual price of the shoes is $30. Her consumer surplus on this pair of shoes is

Which of the following is a CORRECT statement?

In 2012 a severe drought raised the price of corn. For a farmer in Canada who harvested a normal crop because the farm was not affected directly by the drought, the increase in the price of corn

Resource use is efficient when

What are some of the potential obstacles that can prevent a market from reaching the efficient outcome? Briefly define each obstacle.

When a deadweight loss occurs in a market, we can be certain that

A market demand curve is constructed by

By reducing its output compared to a competitive market, a monopoly leads to

The table below shows the supply schedules for Fred's Pizza and Johnny's Pizza, the only sellers of pizza in the market. -Using the table, Fred's marginal cost of the 200th slice of pizza is

Which of the following is TRUE?

-The figure above shows the market for milk. If a drought lowers the productivity of dairy cows so that they give less milk, then the efficient quantity of milk ________ and the consumer surplus ________.

-In the above figure, when the efficient quantity is produced the marginal social cost of the last magazine is

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 milk. The price that producers must be offered to get them to produce 250 gallons of milk per day is .

-The figure above shows the market for milk. If a drought lowers the productivity of dairy cows so that they give less milk, then the efficient quantity of milk and the consumer surplus .