Question 1

A "social planner" is a fictional societal planner who would always choose the same outcome as the competitive market.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following is true about competitive equilibria in environments where the conditions of the first welfare theorem are satisfied?

Accepted Answer

A) We have to be able to represent the demand side of the economy by a representative consumer. 
B) Consumer surplus is smaller than what would be estimated if it were measured on the market demand curve when goods are normal. 
C) Producer surplus is zero in the long run when all firms share the same technology. 
D) (a) and (b) are true. 
E) (b) and (c) are true.
F)(a) and (c) are true.
G)All of the above.
H)None of the above. 
A) We have to be able to represent the demand side of the economy by a representative consumer. 
B) Consumer surplus is smaller than what would be estimated if it were measured on the market demand curve when goods are normal. 
C) Producer surplus is zero in the long run when all firms share the same technology. 
D) (a) and (b) are true. 
E) (b) and (c) are true.
F)(a) and (c) are true.
G)All of the above.
H)None of the above.

Question 3

If the individuals in a group of consumers have identical tastes, then the group can be treated as if it behaved as a singe representative consumer.

Accepted Answer

A) True 
 B)False

Question 4

In a 2-good model, if individuals in a group all have tastes that are quasilinear in good 1, then we can treat the group as if it was a single representative consumer.

Accepted Answer

A) True 
 B)False

A "social planner" is a fictional societal planner who would always choose the same outcome as the competitive market.

Which of the following is true about competitive equilibria in environments where the conditions of the first welfare theorem are satisfied?

If the individuals in a group of consumers have identical tastes, then the group can be treated as if it behaved as a singe representative consumer.

In a 2-good model, if individuals in a group all have tastes that are quasilinear in good 1, then we can treat the group as if it was a single representative consumer.

Introduction

A Consumers Economic Circumstances

Economic Circumstances in Labor and Financial Markets

Tastes and Indifference Curves

Different Types of Tastes

Doing the Best We Can

Income and Substitution Effects in Consumer Goods Markets

Wealth and Substitution Effects in Labor and Capital Markets

Demand for Goods and Supply of Labor and Capital

Consumer Surplus and Deadweight Loss

One Input and One Output: a Short-Run Producer Model

Production With Multiple Inputs

Production Decisions in the Short and Long Run

Competitive Market Equilibrium

General Equilibrium

Choice and Markets in the Presence of Risk

Elasticities, Price-Distorting Policies, and Non-Price Rationing

Distortionary Taxes and Subsidies

Prices and Distortions Across Markets

Externalities in Competitive Markets

Asymmetric Information in Competitive Markets

Monopoly

Strategic Thinking and Game Theory

Oligopoly

Product Differentiation and Innovation in Markets

Public Goods

Governments and Politics

What Is Good Challenges From Psychology and Philosophy

Filters

Exam 15: The Invisible Hand and the First Welfare Theorem

A "social planner" is a fictional societal planner who would always choose the same outcome as the competitive market.

Which of the following is true about competitive equilibria in environments where the conditions of the first welfare theorem are satisfied?

If the individuals in a group of consumers have identical tastes, then the group can be treated as if it behaved as a singe representative consumer.

In a 2-good model, if individuals in a group all have tastes that are quasilinear in good 1, then we can treat the group as if it was a single representative consumer.

Introduction

A Consumers Economic Circumstances

Economic Circumstances in Labor and Financial Markets

Tastes and Indifference Curves

Different Types of Tastes

Doing the Best We Can

Income and Substitution Effects in Consumer Goods Markets

Wealth and Substitution Effects in Labor and Capital Markets

Demand for Goods and Supply of Labor and Capital

Consumer Surplus and Deadweight Loss

One Input and One Output: a Short-Run Producer Model

Production With Multiple Inputs

Production Decisions in the Short and Long Run

Competitive Market Equilibrium

General Equilibrium

Choice and Markets in the Presence of Risk

Elasticities, Price-Distorting Policies, and Non-Price Rationing

Distortionary Taxes and Subsidies

Prices and Distortions Across Markets

Externalities in Competitive Markets

Asymmetric Information in Competitive Markets

Monopoly

Strategic Thinking and Game Theory

Oligopoly

Product Differentiation and Innovation in Markets

Public Goods

Governments and Politics

What Is Good Challenges From Psychology and Philosophy

Filters