Question 1

If a market produces a level of output that exceeds the competitive equilibrium output,then

Accepted Answer

A) social welfare will be higher. 
B) producer surplus will be higher. 
C) marginal cost will exceed price. 
D) All of the above. 
A) social welfare will be higher. 
B) producer surplus will be higher. 
C) marginal cost will exceed price. 
D) All of the above.

Question 2

In the short run,if a firm operates,it earns a profit of $500.The fixed costs of the firm are $100.This firm has a producer surplus of

Accepted Answer

A) $500. 
B) $100. 
C) $400. 
D) $600. 
A) $500. 
B) $100. 
C) $400. 
D) $600.

Question 3

If a city decides to lift restrictions on how many taxi cabs can operate,social welfare will increase.

Accepted Answer

A) True 
 B)False

Question 4

-The above figure shows the market for rice in Japan.SDomestic represents the domestic supply curve,and Sworld represents the world supply curve.A $1 per unit tariff has the same effect on producer and consumer surplus as a quota of

Accepted Answer

A) 25 units. 
B) 30 units. 
C) 35 units. 
D) 65 units. 
A) 25 units. 
B) 30 units. 
C) 35 units. 
D) 65 units.

Question 5

Mister Jones was selling his house.The asking price was $220,000,and Jones decided he would take no less than $200,000.After some negotiation,Mister Smith purchased the house for $205,000.Jones' producer surplus is

Accepted Answer

A) $5,000. 
B) $15,000. 
C) $20,000. 
D) Not able to be calculated from the information given. 
A) $5,000. 
B) $15,000. 
C) $20,000. 
D) Not able to be calculated from the information given.

Question 6

-The above figure shows the market for rice in Japan.SDomestic represents the domestic supply curve,and Sworld represents the world supply curve.If a $1 per unit tariff is imposed on imported rice,the quantity of imported rice will decrease by

Accepted Answer

A) 15 units. 
B) 25 units. 
C) 35 units. 
D) 50 units. 
A) 15 units. 
B) 25 units. 
C) 35 units. 
D) 50 units.

Question 7

Producer surplus equals total revenue minus the sum of all marginal cost.

Accepted Answer

A) True 
 B)False

Question 8

If in a market the last unit of output was sold at a price higher than marginal cost,

Accepted Answer

A) producers are better off producing more. 
B) consumers are better off if less of the product is sold. 
C) social welfare is not maximized. 
D) the unit increased total profit. 
A) producers are better off producing more. 
B) consumers are better off if less of the product is sold. 
C) social welfare is not maximized. 
D) the unit increased total profit.

Question 9

Suppose the inverse supply curve in a market is Q = 6p2.If price decreases from 5 to 4,the change in producer surplus is

Accepted Answer

A) 150. 
B) -54. 
C) -6. 
D) -122. 
A) 150. 
B) -54. 
C) -6. 
D) -122.

Question 10

Suppose anyone with a driver's license is capable of supplying one trip from the airport to the downtown business center on any given day.The long-run supply curve of such trips is horizontal at p = $50,which is the average cost of such trips.Suppose daily demand is Q = 1000 - 10p.Calculate the change in consumer surplus,producer surplus and social welfare if the city government requires those people supplying such trips to possess a special license,and the government will issue only 300 licenses.

Accepted Answer

The competitive equilibrium is Q = 1000

Question 11

-The above figure shows supply and demand curves for apartment units in a large city.If the city government passes a law that establishes $450 per month as the legal maximum rent,consumer surplus will be

Accepted Answer

A) a. 
B) a + b + f. 
C) a + b + c. 
D) a + b + c + f + g. 
A) a. 
B) a + b + f. 
C) a + b + c. 
D) a + b + c + f + g.

Question 12

-The above figure shows the market for rice in Japan.SDomestic represents the domestic supply curve,and Sworld represents the world supply curve.If imported rice is banned,the loss in social welfare is

Accepted Answer

A) a + b + c + d + i + j. 
B) a. 
C) c + e. 
D) a + b + c + d. 
A) a + b + c + d + i + j. 
B) a. 
C) c + e. 
D) a + b + c + d.

Question 13

-The above figure shows the market for rice in Japan.SDomestic represents the domestic supply curve,and Sworld represents the world supply curve.If a $1 tariff is imposed on imported rice,the change in consumer surplus is

Accepted Answer

A) c + d. 
B) c + d +g. 
C) a + b + c + d. 
D) f + g. 
A) c + d. 
B) c + d +g. 
C) a + b + c + d. 
D) f + g.

Question 14

The services of real estate brokers are provided in a competitive market.If the state Board of Realtors enacts several requirements that limit the number of real estate brokers,which of the following is most likely to occur?

Accepted Answer

A) The supply curve of real estate brokers will shift to the left. 
B) The supply curve of real estate brokers will shift to the right. 
C) Social welfare will remain unchanged. 
D) The supply curve will remain unchanged. 
A) The supply curve of real estate brokers will shift to the left. 
B) The supply curve of real estate brokers will shift to the right. 
C) Social welfare will remain unchanged. 
D) The supply curve will remain unchanged.

Question 15

-The above figure shows supply and demand curves for apartment units in a large city.If the city government passes a law that establishes $350 per month as the legal maximum rent,the consumer's net gain in surplus equals

Accepted Answer

A) c - f. 
B) b - f. 
C) d - f. 
D) The answer cannot be determined from the information given. 
A) c - f. 
B) b - f. 
C) d - f. 
D) The answer cannot be determined from the information given.

Question 16

Explain why the competitive output maximizes welfare.

Accepted Answer

If less output is produced,then the last

Question 17

The larger the U.S.imposed per unit import tariff on a good imported and produced in the U.S. ,

Accepted Answer

A) the smaller the U.S.consumer surplus. 
B) the larger the U.S.producer surplus. 
C) the larger the government revenue. 
D) All of the above. 
A) the smaller the U.S.consumer surplus. 
B) the larger the U.S.producer surplus. 
C) the larger the government revenue. 
D) All of the above.

Question 18

The tax revenue that is generated by a government tax is counted towards total welfare.

Accepted Answer

A) True 
 B)False

Question 19

-The above figure shows supply and demand curves for apartment units in a large city.If the city government passes a law that establishes $350 per month as the legal maximum rent,producer surplus will be

Accepted Answer

A) d. 
B) d + e. 
C) d + g. 
D) d + c + g. 
A) d. 
B) d + e. 
C) d + g. 
D) d + c + g.

Question 20

A per unit subsidy increases both consumer and producer surplus,but results in a deadweight loss.

Accepted Answer

A) True 
 B)False

If a market produces a level of output that exceeds the competitive equilibrium output,then

In the short run,if a firm operates,it earns a profit of $500.The fixed costs of the firm are $100.This firm has a producer surplus of

If a city decides to lift restrictions on how many taxi cabs can operate,social welfare will increase.

-The above figure shows the market for rice in Japan.S_Domestic represents the domestic supply curve,and S_world represents the world supply curve.A $1 per unit tariff has the same effect on producer and consumer surplus as a quota of

Mister Jones was selling his house.The asking price was $220,000,and Jones decided he would take no less than $200,000.After some negotiation,Mister Smith purchased the house for $205,000.Jones' producer surplus is

-The above figure shows the market for rice in Japan.S_Domestic represents the domestic supply curve,and S_world represents the world supply curve.If a $1 per unit tariff is imposed on imported rice,the quantity of imported rice will decrease by

Producer surplus equals total revenue minus the sum of all marginal cost.

If in a market the last unit of output was sold at a price higher than marginal cost,

Suppose the inverse supply curve in a market is Q = 6p².If price decreases from 5 to 4,the change in producer surplus is

-The above figure shows supply and demand curves for apartment units in a large city.If the city government passes a law that establishes $450 per month as the legal maximum rent,consumer surplus will be

-The above figure shows the market for rice in Japan.S_Domestic represents the domestic supply curve,and S_world represents the world supply curve.If imported rice is banned,the loss in social welfare is

-The above figure shows the market for rice in Japan.S_Domestic represents the domestic supply curve,and S_world represents the world supply curve.If a $1 tariff is imposed on imported rice,the change in consumer surplus is

The services of real estate brokers are provided in a competitive market.If the state Board of Realtors enacts several requirements that limit the number of real estate brokers,which of the following is most likely to occur?

-The above figure shows supply and demand curves for apartment units in a large city.If the city government passes a law that establishes $350 per month as the legal maximum rent,the consumer's net gain in surplus equals

Explain why the competitive output maximizes welfare.

The larger the U.S.imposed per unit import tariff on a good imported and produced in the U.S. ,

The tax revenue that is generated by a government tax is counted towards total welfare.

-The above figure shows supply and demand curves for apartment units in a large city.If the city government passes a law that establishes $350 per month as the legal maximum rent,producer surplus will be

A per unit subsidy increases both consumer and producer surplus,but results in a deadweight loss.

Introduction

Supply and Demand

A Consumers Constrained Choice

Demand

Consumer Welfare and Policy Analysis

Firms and Production

Costs

Competitive Firms and Markets

General Equilibrium and Economic Welfare

Monopoly and Monopsony

Pricing and Advertising

Game Theory

Oligopoly and Monopolistic Competition

Factor Markets

Uncertainty

Property Rights, Externalities, Rivalry, and Exclusion

Asymmetric Information

Contracts and Moral Hazards

Filters

Exam 9: Properties and Applications of the Competitive Model

If a market produces a level of output that exceeds the competitive equilibrium output,then

In the short run,if a firm operates,it earns a profit of $500.The fixed costs of the firm are $100.This firm has a producer surplus of

If a city decides to lift restrictions on how many taxi cabs can operate,social welfare will increase.

-The above figure shows the market for rice in Japan.SDomestic represents the domestic supply curve,and Sworld represents the world supply curve.A $1 per unit tariff has the same effect on producer and consumer surplus as a quota of

Mister Jones was selling his house.The asking price was $220,000,and Jones decided he would take no less than $200,000.After some negotiation,Mister Smith purchased the house for $205,000.Jones' producer surplus is

-The above figure shows the market for rice in Japan.SDomestic represents the domestic supply curve,and Sworld represents the world supply curve.If a $1 per unit tariff is imposed on imported rice,the quantity of imported rice will decrease by

Producer surplus equals total revenue minus the sum of all marginal cost.

If in a market the last unit of output was sold at a price higher than marginal cost,

Suppose the inverse supply curve in a market is Q = 6p2.If price decreases from 5 to 4,the change in producer surplus is

-The above figure shows supply and demand curves for apartment units in a large city.If the city government passes a law that establishes $450 per month as the legal maximum rent,consumer surplus will be

-The above figure shows the market for rice in Japan.SDomestic represents the domestic supply curve,and Sworld represents the world supply curve.If imported rice is banned,the loss in social welfare is

-The above figure shows the market for rice in Japan.SDomestic represents the domestic supply curve,and Sworld represents the world supply curve.If a $1 tariff is imposed on imported rice,the change in consumer surplus is

The services of real estate brokers are provided in a competitive market.If the state Board of Realtors enacts several requirements that limit the number of real estate brokers,which of the following is most likely to occur?

-The above figure shows supply and demand curves for apartment units in a large city.If the city government passes a law that establishes $350 per month as the legal maximum rent,the consumer's net gain in surplus equals

Explain why the competitive output maximizes welfare.

The larger the U.S.imposed per unit import tariff on a good imported and produced in the U.S. ,

The tax revenue that is generated by a government tax is counted towards total welfare.

-The above figure shows supply and demand curves for apartment units in a large city.If the city government passes a law that establishes $350 per month as the legal maximum rent,producer surplus will be

A per unit subsidy increases both consumer and producer surplus,but results in a deadweight loss.

Introduction

Supply and Demand

A Consumers Constrained Choice

Demand

Consumer Welfare and Policy Analysis

Firms and Production

Costs

Competitive Firms and Markets

General Equilibrium and Economic Welfare

Monopoly and Monopsony

Pricing and Advertising

Game Theory

Oligopoly and Monopolistic Competition

Factor Markets

Uncertainty

Property Rights, Externalities, Rivalry, and Exclusion

Asymmetric Information

Contracts and Moral Hazards

Filters

-The above figure shows the market for rice in Japan.S_Domestic represents the domestic supply curve,and S_world represents the world supply curve.A $1 per unit tariff has the same effect on producer and consumer surplus as a quota of

-The above figure shows the market for rice in Japan.S_Domestic represents the domestic supply curve,and S_world represents the world supply curve.If a $1 per unit tariff is imposed on imported rice,the quantity of imported rice will decrease by

Suppose the inverse supply curve in a market is Q = 6p².If price decreases from 5 to 4,the change in producer surplus is

-The above figure shows the market for rice in Japan.S_Domestic represents the domestic supply curve,and S_world represents the world supply curve.If imported rice is banned,the loss in social welfare is

-The above figure shows the market for rice in Japan.S_Domestic represents the domestic supply curve,and S_world represents the world supply curve.If a $1 tariff is imposed on imported rice,the change in consumer surplus is