Question 1

Figure 7-23  
-Refer to Figure 7-23. At equilibrium, total surplus is represented by the area

Accepted Answer

A)  A+B+C. 
B)  A+B+D+F. 
C)  A+B+C+D+H+F. 
D)  A+B+C+D+H+F+G+I. 
A)  A+B+C. 
B)  A+B+D+F. 
C)  A+B+C+D+H+F. 
D)  A+B+C+D+H+F+G+I.

Question 2

Figure 7-27  
-Refer to Figure 7-27. Buyers who value this good more than the equilibrium price are represented by which line segment?

Accepted Answer

A)  AC. 
B)  CK. 
C)  BC. 
D)  CH. 
A)  AC. 
B)  CK. 
C)  BC. 
D)  CH.

Question 3

Figure 7-16  
-Refer to Figure 7-16. If the price of the good is $600, then

Accepted Answer

A)  consumer surplus is $800. 
B)  consumer surplus is $900. 
C)  producer surplus is $900. 
D)  producer surplus is $1,000. 
A)  consumer surplus is $800. 
B)  consumer surplus is $900. 
C)  producer surplus is $900. 
D)  producer surplus is $1,000.

Question 4

Michael values a stainless steel refrigerator for his new house at $3,500, but he succeeds in buying one for $3,000. Michael's willingness to pay is

Accepted Answer

A)  $500. 
B)  $3,000. 
C)  $3,500. 
D)  $6,500. 
A)  $500. 
B)  $3,000. 
C)  $3,500. 
D)  $6,500.

Question 5

Suppose consumer income increases. If grass seed is a normal good, the equilibrium price of grass seed will

Accepted Answer

A)  decrease, and producer surplus in the industry will decrease. 
B)  increase, and producer surplus in the industry will increase. 
C)  decrease, and producer surplus in the industry will increase. 
D)  increase, and producer surplus in the industry will decrease. 
A)  decrease, and producer surplus in the industry will decrease. 
B)  increase, and producer surplus in the industry will increase. 
C)  decrease, and producer surplus in the industry will increase. 
D)  increase, and producer surplus in the industry will decrease.

Question 6

Chad is willing to pay $5.00 to get his first cup of morning latté. He buys a cup from a vendor selling latté for $3.75 per cup. Chad's consumer surplus is

Accepted Answer

A)  $8.75. 
B)  $5.00. 
C)  $3.75. 
D)  $1.25. 
A)  $8.75. 
B)  $5.00. 
C)  $3.75. 
D)  $1.25.

Question 7

Table 7-3
The only four consumers in a market have the following willingness to pay for a good:  
-Refer to Table 7-3. If the market price for the good is $20, who will purchase the good?

Accepted Answer

A)  Ming-la only 
B)  Carlos and Quilana only 
C)  Quilana and Wilbur only 
D)  Quilana, Wilbur, and Ming-la only 
A)  Ming-la only 
B)  Carlos and Quilana only 
C)  Quilana and Wilbur only 
D)  Quilana, Wilbur, and Ming-la only

Question 8

You are offered a free ticket to see the Chicago Cubs play the Chicago White Sox at Wrigley Field. Assume the ticket has no resale value. Willie Nelson is performing on the same night, and his concert is your next-best alternative activity. Tickets to see Willie Nelson cost $40. On any given day, you would be willing to pay up to $50 to see and hear Willie Nelson perform. Assume there are no other costs of seeing either event. Based on this information, at a minimum, how much would you have to value seeing the Cubs play the White Sox to accept the ticket and go to the game?

Accepted Answer

A)  $0 
B)  $10 
C)  $40 
D)  $50 
A)  $0 
B)  $10 
C)  $40 
D)  $50

Question 9

Table 7-3
The only four consumers in a market have the following willingness to pay for a good:  
-Refer to Table 7-3. Who experiences the largest loss of consumer surplus when the price of the good increases from $20 to $22?

Accepted Answer

A)  Quilana 
B)  Wilbur 
C)  Ming-la 
D)  All three buyers experience the same loss of consumer surplus. 
A)  Quilana 
B)  Wilbur 
C)  Ming-la 
D)  All three buyers experience the same loss of consumer surplus.

Exam 7: Consumers, Producers, and the Efficiency of Markets

Figure 7-23 -Refer to Figure 7-23. At equilibrium, total surplus is represented by the area

Figure 7-27 -Refer to Figure 7-27. Buyers who value this good more than the equilibrium price are represented by which line segment?

Figure 7-16 -Refer to Figure 7-16. If the price of the good is $600, then

Michael values a stainless steel refrigerator for his new house at $3,500, but he succeeds in buying one for $3,000. Michael's willingness to pay is

Suppose consumer income increases. If grass seed is a normal good, the equilibrium price of grass seed will

Chad is willing to pay $5.00 to get his first cup of morning latté. He buys a cup from a vendor selling latté for $3.75 per cup. Chad's consumer surplus is

Table 7-3 The only four consumers in a market have the following willingness to pay for a good: -Refer to Table 7-3. If the market price for the good is $20, who will purchase the good?

Table 7-3 The only four consumers in a market have the following willingness to pay for a good: -Refer to Table 7-3. Who experiences the largest loss of consumer surplus when the price of the good increases from $20 to $22?

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Application: the Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

The Basic Tools of Finance

Unemployment

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Trade-Off Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

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