Question 1

If you are willing to sell your lawn mower business for $355,000 and someone offers you $420,000 for it,this transaction will generate:​

Accepted Answer

A) ​There is no surplus created 
B) $65,000 worth of seller surplus and unknown amount of buyer surplus 
C) $30,000 worth of buyer surplus and $35,000 of seller surplus 
D) ​$65,000 worth of buyer surplus and unknown amount of seller surplus 
A) ​There is no surplus created 
B) $65,000 worth of seller surplus and unknown amount of buyer surplus 
C) $30,000 worth of buyer surplus and $35,000 of seller surplus 
D) ​$65,000 worth of buyer surplus and unknown amount of seller surplus

Question 2

​A buyer values a house at $525,000 and a seller values the same house at $485,000.If sales tax is 8% and is levied on the buyer,then,what would be the highest price that the buyer would be willing to pay?

Accepted Answer

A) ​$525,000 
B) $523,800 
C) $485,000 
D) ​$486,111 
A) ​$525,000 
B) $523,800 
C) $485,000 
D) ​$486,111

Question 3

​A retailer X that is operating at a loss gets bought out by a larger chain of department stores,which shuts down the brand,using its assets for their own brand,

Accepted Answer

A) ​Wealth is destroyed since the company shut down 
B) Wealth is created since the resources were of lesser value under the X brand and are now worth more 
C) Wealth is neither created nor destroyed since the total amount of resources stay the same 
D) ​None of the above 
A) ​Wealth is destroyed since the company shut down 
B) Wealth is created since the resources were of lesser value under the X brand and are now worth more 
C) Wealth is neither created nor destroyed since the total amount of resources stay the same 
D) ​None of the above

Question 4

​A consumer values a car at $30,000 and a producer values the same car at $20,000.If the transaction is completed at $24,000,the transaction will generate:

Accepted Answer

A) ​No surplus 
B) $4,000 worth of seller surplus and unknown amount of buyer surplus 
C) $6,000 worth of buyer surplus and $4,000 of seller surplus 
D) ​$6,000 worth of buyer surplus and unknown amount of seller surplus 
A) ​No surplus 
B) $4,000 worth of seller surplus and unknown amount of buyer surplus 
C) $6,000 worth of buyer surplus and $4,000 of seller surplus 
D) ​$6,000 worth of buyer surplus and unknown amount of seller surplus

Question 5

​An advantage of capitalism is that

Accepted Answer

A) ​It allows the market to self-regulate and clear itself 
B) It allows a person to follow his or her own self interest 
C) It allows voluntary transactions,which create wealth 
D) ​All of the above 
A) ​It allows the market to self-regulate and clear itself 
B) It allows a person to follow his or her own self interest 
C) It allows voluntary transactions,which create wealth 
D) ​All of the above

Question 6

Rent controls​

Accepted Answer

A) ​are an example of price floors. 
B) are an example of price ceilings. 
C) destroy wealth by preventing the movement of apartments to higher-valued use. 
D) ​Both b and c 
A) ​are an example of price floors. 
B) are an example of price ceilings. 
C) destroy wealth by preventing the movement of apartments to higher-valued use. 
D) ​Both b and c

Question 7

Price floors are primarily intended to help​

Accepted Answer

A) ​No one 
B) Consumers 
C) Producers 
D) ​Government 
A) ​No one 
B) Consumers 
C) Producers 
D) ​Government

Question 8

Securities Taxes
Congress has proposed a new tax on any transactions of securities traded on Wall Street.How would this destroy wealth?

Accepted Answer

In order for both the buyer and seller t

Question 9

​You are sick and tired of your old wardrobe.You decide to donate it to a charity of your choice.Your action

Accepted Answer

A) ​Creates wealth by moving the clothes from lower value use to higher value use 
B) Destroys wealth since you lose your clothes 
C) Creates wealth by making you feel richer 
D) ​All of the above 
A) ​Creates wealth by moving the clothes from lower value use to higher value use 
B) Destroys wealth since you lose your clothes 
C) Creates wealth by making you feel richer 
D) ​All of the above

Question 10

Price ceilings cause​

Accepted Answer

A) ​Some suppliers to drop out of the market 
B) A decrease in the total production in the market 
C) The creation of black markets 
D) ​All the above 
A) ​Some suppliers to drop out of the market 
B) A decrease in the total production in the market 
C) The creation of black markets 
D) ​All the above

Question 11

One lesson of business:​

Accepted Answer

A) ​is tracing the consequences of a policy. 
B) promoting a policy change to eradicate inefficiencies. 
C) moving assets from lower to higher value uses,thereby creating wealth. 
D) ​None of the above 
A) ​is tracing the consequences of a policy. 
B) promoting a policy change to eradicate inefficiencies. 
C) moving assets from lower to higher value uses,thereby creating wealth. 
D) ​None of the above

Question 12

​A consumer values a car at $30,000 and a producer values the same car at $20,000.If a tax is levied on the seller,what level of tax will result in unconsummated transaction?

Accepted Answer

A) ​0% 
B) 25% 
C) 60% 
D) ​40% 
A) ​0% 
B) 25% 
C) 60% 
D) ​40%

Question 13

A price ceiling can often be viewed as:​

Accepted Answer

A) ​the government setting price above market equilibrium price. 
B) an implicit tax on producers and an implicit subsidy to consumers. 
C) ​the government setting price below market equilibrium price. 
D) ​Both b and c 
A) ​the government setting price above market equilibrium price. 
B) an implicit tax on producers and an implicit subsidy to consumers. 
C) ​the government setting price below market equilibrium price. 
D) ​Both b and c

Question 14

The difference between the minimum price the producer is willing to accept and the price the producer actually receives for a product is referred to as:​

Accepted Answer

A) ​market surplus. 
B) market shortage. 
C) consumer surplus. 
D) ​producer surplus. 
A) ​market surplus. 
B) market shortage. 
C) consumer surplus. 
D) ​producer surplus.

If you are willing to sell your lawn mower business for $355,000 and someone offers you $420,000 for it,this transaction will generate:

A buyer values a house at $525,000 and a seller values the same house at $485,000.If sales tax is 8% and is levied on the buyer,then,what would be the highest price that the buyer would be willing to pay?

A retailer X that is operating at a loss gets bought out by a larger chain of department stores,which shuts down the brand,using its assets for their own brand,

A consumer values a car at $30,000 and a producer values the same car at $20,000.If the transaction is completed at $24,000,the transaction will generate:

An advantage of capitalism is that

Rent controls

Price floors are primarily intended to help

Securities Taxes Congress has proposed a new tax on any transactions of securities traded on Wall Street.How would this destroy wealth?

You are sick and tired of your old wardrobe.You decide to donate it to a charity of your choice.Your action

Price ceilings cause

One lesson of business:

A consumer values a car at $30,000 and a producer values the same car at $20,000.If a tax is levied on the seller,what level of tax will result in unconsummated transaction?

A price ceiling can often be viewed as:

The difference between the minimum price the producer is willing to accept and the price the producer actually receives for a product is referred to as:

Benefits, Costs, and Decisions

Extent How Much Decisions

Investment Decisions: Look Ahead and Reason Back

Simple Pricing

Economies of Scale and Scope

Understanding Markets and Industry Changes

Market Structure and Long Run Equilibrium

Strategy: the Quest to Keep Profit From Eroding

Foreign Exchange, Trade, and Bubbles

More Realistic and Complex Pricing

Direct Price Discrimination

Strategic Games

Bargaining

Making Decisions With Uncertainty

Auctions

The Problem of Adverse Selection

The Problem of Moral Hazard

Getting Employees to Work in the Firms Best Interest

Getting Divisions to Work in the Firms Best Interest

Managing Vertical Relationships

Filters

Exam 1: The One Lessor of Business