Exam 5: Efficiency and Equity

Use the information below to answer the following questions. Fact 5.3.1 Only 1 percent of the world supply of water is fit for human consumption. Some places have more water than they can use; some could use much more than they have. The 1 percent available would be sufficient if only it were in the right place. -Refer to Fact 5.3.1. A free world market in water ________ achieve an efficient use of the world's water resources because ________.

Suppose that the Hot Dog House can produce hotdogs at a constant cost of $0.25 each. If the Hot Dog House sells hotdogs for $0.50 each, then the Hot Dog House

All of the following statements are true except:

As the quantity of hot dogs demanded increases,

Use the figure below to answer the following questions. Figure 5.3.2 -Refer to Figure 5.3.2. If the level of output is 200 units, the deadweight loss is area

The marginal cost of producing an additional basket of tomatoes is $5.00. The consumer is willing to pay a maximum of $9.00 for an additional basket. A farmer sells a basket of tomatoes for $6.00 each. The farmer receives a producer surplus from selling an additional basket of tomatoes equal to

Choose the statement or statements that are correct. I. The value of one more unit of a good or service is its marginal benefit. II. Marginal benefit equals the total amount we spend on a good or service. III. Marginal benefit is the maximum amount willingly paid for another unit of a good or service.

If the owner of an apartment building rents only to married couples over the age of 30, the method of resource allocation is

Charlene is willing to pay $5.00 for a sandwich. If the price of a sandwich is ________, Charlene ________.

What is the producer surplus for the market from the production of the 100th unit of a good?

In 2012, a severe drought led to an increase in the price of corn. Farmer Lyle was not affected by the drought. Comparing 2012 to the previous year in which there was no drought, Farmer Lyle's

Use the table below to answer the following questions. Table 5.2.1 -Refer to Table 5.2.1. If the price is $6 a unit, the producer surplus on the third unit is

Lotteries work best

Use the figure below to answer the following questions. Figure 5.3.1 -Refer to Figure 5.3.1. At the efficient quantity, the price is

Use the figure below to answer the following question. Figure 5.3.4 -Refer to Figure 5.3.4. The graph shows the market for cell phones. When production is efficient, total surplus is ________ and the cost of producing the cell phones sold is ________.

Use the figure below to answer the following questions. Figure 5.3.2 -Refer to Figure 5.3.2. If the level of output is 150 units, the consumer surplus is area

Contests do a good job in resource allocation

What is the consumer surplus for the market from the production of the 100th unit of a good?

Use the table below to answer the following question. Table 5.2.4 -Table 5.2.4 shows the demand schedules for pizza for Abby and Barry who are the only buyers in the market. What is the marginal social benefit from the 45th slice of pizza?