Deck 4: Consumer and Producer Surplus

Question 1

(Table: Consumer Surplus) Look at the table Consumer Surplus.If the tickets to The Nutty Nutcracker
are free and there is no other market for tickets, the total consumer surplus for the five students is:
A.$0.
B.$100.
C.$150.
D.$320.

Answer 1

$320.

Question 2

(Table: Consumer Surplus) Look at the table Consumer Surplus.If the price of a ticket to see The Nutty Nutcracker is $75, Lois's consumer surplus is:
A.$25.
B.$60.
C.$75.
D.$100.

Answer 2

$25.

Question 3

(Table: Consumer Surplus and Phantom Tickets) Look at the table Consumer Surplus and Phantom Tickets.If the box office price of a ticket to see Phantom of the Opera is $50 and there is no other market for tickets, the total consumer surplus for the five students is:

A)$100.
B)$175.
C)$230.
D)$240.

Answer 3

D

Question 4

The consumers' willingness to pay for a good is used to derive the for that good.
A.producer surplus
B.cost of production
C.supply curve
D.demand curve

Question 5

Consumer surplus can be found by computing the area:

A)above the supply curve and below the price.
B)under the supply curve and above the price.
C)under the demand curve and above the price.
D)under the demand curve and below the price.

Question 6

A consumer's willingness to pay depends on
A.the cost of producing the good or service.
B.the benefit that he or she expects to receive from consuming the good or service.
C.the size of the shortage of the good or service.
D.the size of the surplus of the good or service.

Question 7

(Table: Consumer Surplus) Look at the table Consumer Surplus.If the price of a ticket to see The Nutty Nutcracker is $75, Miguel's consumer surplus is:
A.$60.
B.$50.
C.$15.
D.$240.

Question 8

(Table: Music Downloads) Look at the table Music Downloads.Two consumers, Eli and Madison, like to download songs to their MP₃ players, and the table represents their willingness to pay for each downloaded song.If an individual song can be downloaded at a price of $1, what is the total consumer surplus received by these consumers?

A)$19.25
B)$18
C)$10
D)$11

Question 9

(Table: Willingness to Pay for Basketball Sneakers) If the price of basketball sneakers is $125, which players will purchase sneakers?
A.Jamichael and Javon
B.Jamichael and Corey
C.Jamichael, Corey, and Rudy
D.Jamichael, Corey, Rudy, and Ray

Question 10

(Table: Willingness to Pay for Basketball Sneakers) If the price of basketball sneakers is $180, how many pairs will be purchased?
A.0
B.1
C.2
D.3

Question 11

Consumer surplus for an individual buyer is equal to:
A.the consumer's willingness to pay for the good minus the marginal cost of producing the good.
B.the price of the good minus the marginal cost of producing the good.
C.the consumer's willingness to pay for the good minus the price of the good.
D.The marginal cost of the good minus the consumer's willingness to pay for the good.

Question 12

(Table: Willingness to Pay for Basketball Sneakers) If the price of basketball sneakers is $60, how many pairs will be purchased?
A.5
B.4
C.3
D.2

Question 13

The total consumer surplus for good X can be calculated in all except one of the following ways.Which is the exception?
A.the sum of the individual consumer surpluses for all buyers of X
B.the area below the demand curve for X and above the price of X
C.the area bounded by the demand curve for X and the two axes
D.the sum, for all buyers of X, of the difference between what each buyer is willing to pay for X and the amount actually paid

Question 14

(Table: Consumer Surplus and Phantom Tickets) Look at the table Consumer Surplus and Phantom
Tickets.If the price of a ticket to see Phantom of the Opera is $50, then Robert's consumer surplus is:
A.$60.
B.$50.
C.$10.
D.$240.

Question 15

A consumer's willingness to pay reflects
A.the maximum price at which he or she would buy the good or service.
B.the minimum price at which he or she would buy the good or service.
C.the cost of producing the good or service.
D.the equilibrium price of the good or service.

Question 16

(Table: Consumer Surplus) Look at the table Consumer Surplus.If the price of a ticket to see The Nutty Nutcracker is $50, Narum's consumer surplus is:
A.$60.
B.$50.
C.$15.
D.$240.

Question 17

(Table: Willingness to Pay for Basketball Sneakers) If the price of basketball sneakers is $145, which player will purchase sneakers?
A.Jamichael
B.Corey
C.Rudy
D.Ray

Question 18

(Table: Consumer Surplus) Look at the table Consumer Surplus.If the price of a ticket to see The Nutty Nutcracker is $75 and there is no other market for tickets, the total consumer surplus for the five students is:
A.$190.
B.$125.
C.$40.
D.$0.

Question 19

(Table: Willingness to Pay for Basketball Sneakers) If the price of basketball sneakers is $100, how many pairs will be purchased?
A.1
B.2
C.3
D.4

Question 20

We can measure total consumer surplus for good X as:
A.the sum of the individual consumer surpluses for all buyers of X.
B.the area above the demand curve for X and below the price of X.
C.the area bounded by the demand curve for X and the two axes.
D.the area above the supply curve for X.

Question 21

Suppose the United States removes the current sugar quotas and the market price of sugar drops.In the candy bar market, we would expect:
A.the consumer surplus to increase.
B.the consumer surplus to decrease.
C.the consumer surplus to be unchanged.
D.the deadweight loss to increase.

Question 22

Mark and Rasheed are at the bookstore buying new calculators for the semester.Mark is willing to pay
$75 and Rasheed is willing to pay $100 for a graphing calculator.The price for a calculator at the bookstore is $65.How much is total consumer surplus?
A.$10
B.$35
C.$45
D.$60

Question 23

Some smaller retailers often go out of business when Walmart opens a new store.One of the reasons for this development could be that:
A.Walmart practices unfair pricing methods that reduce consumer surplus over time.
B.consumers in those areas receive no consumer surplus from Walmart.
C.consumers in those areas receive a larger consumer surplus from shopping at Walmart than from the smaller stores.
D.smaller stores increase prices to compete.

Question 24

Jeanette is willing to pay $100 for the first pair of shoes, $80 for the second pair, $50 for the third, and
$30 for the fourth.If shoes cost $50, Jeanette will buy pairs of shoes and her total
consumer surplus equals _.
A.4; $110
B.3; $230
C.3; $80
D.4; $80

Question 25

(Table: Economics Textbooks) Look at the table Economics Textbooks.The table shows how much money four consumers would be willing to pay for a new economics textbook.If the price of the textbook is $100, what is the total consumer surplus received by these consumers?
A.$125
B.$500
C.$100
D.$75

Question 26

Mark and Rasheed are at the bookstore buying new calculators for the semester.Mark is willing to pay
$75 and Rasheed is willing to pay $100 for a graphing calculator.The price for a calculator at the bookstore is $65.How much is Mark's individual consumer surplus?
A.$10
B.$25
C.$35
D.$75

Question 27

Figure: Monthly Demand for Ice Cream Cones (Figure: Monthly Demand for Ice Cream Cones) Look at the table Monthly Demand for Ice Cream Cones.The graph represents one individual's monthly demand for ice cream cones.At a price of $5 per cone, this individual will consume 10 cones in a month.How much consumer surplus does this consumer receive?

A)$100
B)$50
C)$150
D)$500

Question 28

Ashley bought a new pair of jeans.When she walked out of the store, she thought, "I got such a great deal; I would have paid $40 more for these jeans!" This best represents the concept of:
A.consumer surplus.
B.producer surplus.
C.total surplus.
D.equilibrium.

Question 29

Figure: Market Demand
(Figure: Market Demand) Look at the figure Market Demand.The amount by which the total benefits to consumers exceed their total expenditure is called , and if the price is B, is depicted by the
area _.
A.producer surplus; BCD
B.consumer surplus; 0CDE
C.consumer surplus; BCD

Question 30

An increase in the consumer surplus in the market for milkshakes may result from:

A)an increase in the price of milkshakes.
B)an increase in the supply of milkshakes.
C)a decrease in the demand for milkshakes.
D)a decrease in the supply of milkshakes.

Question 31

Along a given demand curve, an increase in the price of a good will:

A)increase consumer surplus.
B)decrease consumer surplus.
C)have no effect on consumer surplus.
D)decrease producer surplus.

Question 32

Figure: Wireless Mouse Market
(Figure: Wireless Mouse Market) Look at the figure Wireless Mouse Market.Use the graph to calculate consumer surplus when the market is at equilibrium.
A.$4,000
B.$5,000
C.$2,500
D.$3,000

Question 33

Vonda and Aleiyah are shopping together at the mall for new jeans.Vonda is willing to pay $90 and Aleiyah is willing to pay $50 for a pair of jeans.What is the gain in total consumer surplus when the price decreases from $59 to $40?
A.$10
B.$29
C.$31
D.$60

Question 34

When there is a bountiful harvest of grapefruit, total consumer surplus in the grapefruit market:
A.will increase.
B.will decrease.
C.will remain the same.
D.may change, but we can't tell how.

Question 35

Adie wants to take some online classes this semester.She is willing to pay $1,000 for the first class, $800 for the second, $700 for the third, and $500 for the fourth.If online classes cost $750, Adie will take ________ online classes and her consumer surplus will equal _.

A)3; $350
B)4; $600
C)2; $400
D)2; $300

Question 36

Consumer surplus is represented by the area ________ the demand curve and the market
price.
A.above; below
B.above; above
C.below; above
D.below; below

Question 37

Vonda and Aleiyah are shopping together at the mall for new jeans.Vonda is willing to pay $90 and Aleiyah is willing to pay $50 for a pair of jeans.If the price of jeans is $59, how much total consumer surplus is achieved in this market?
A.$0
B.$9
C.$31
D.$40

Question 38

Which of the following is true if there is a decrease in the supply of ice cream?
A.There is an increase in consumer surplus.
B.There is a decrease in consumer surplus.
C.There is no change to consumer surplus.
D.It's impossible to tell what will happen to consumer surplus.

Question 39

Along a given demand curve, an increase in the price of a good will cause consumer surplus to:

A)increase.
B)decrease.
C)not change.
D)cannot be determined without information about the supply curve.

Question 40

Which situation would most likely cause a decrease in consumer surplus in the toy market?
A.The cost of shipping increases because of higher oil prices.
B.Consumer income increases.
C.There is an unexpected baby boom.
D.A new assembly line design increases worker productivity.

Question 41

Figure: The Market for Hamburgers
(Figure: The Market for Hamburgers) Look at the figure The Market for Hamburgers.The figure shows the weekly market for hamburgers in Tuscaloosa.If 400 hamburgers are sold, consumer surplus will equal:
A.$650.
B.$400.
C.$225.
D.$450.

Question 42

Figure: Consumer Surplus I
(Figure: Consumer Surplus I) Look at the figure Consumer Surplus I.If the good is free, consumer surplus equals the area:
A.ABP₂.
B.AFP₁.
C.BGF.
D.AQ₃0.

Question 43

Figure: Consumer Surplus III
(Figure: Consumer Surplus III) Look at the figure Consumer Surplus III.In the figure, total consumer surplus is when the price is $10.
A.$50
B.$59
C.$124
D.$144

Question 44

Figure: Consumer Surplus III
(Figure: Consumer Surplus III) Look at the figure Consumer Surplus III.In the figure, when the price falls from $30 to $25, consumer surplus ________ for a total consumer surplus of _.
A.increases by $25; $74
B.decreases by $15; $34
C.increases by $15; $64
D.increases by $5; $54

Question 45

Figure: Consumer Surplus II
(Figure: Consumer Surplus II) Look at the figure Consumer Surplus II.If the price of the good increases from $3 to $4, consumer surplus will decrease by:
A.$5.
B.$10.
C.$15.
D.$20.

Question 46

Figure: Consumer Surplus I
(Figure: Consumer Surplus I) Look at the figure Consumer Surplus I.At a price of P₂, consumer surplus equals the area:
A.ABP₂.
B.AFP₁.
C.AQ₃0.
D.P₁P₂BF.

Question 47

Which of the following is most likely to increase consumer surplus in the market for cotton T-shirts?
A.Weather conditions provide for an extremely productive cotton harvest.
B.Consumer incomes fall and cotton T-shirts are normal goods.
C.The price of polyester T-shirts falls.
D.The price of industrial sewing machines used to produce garments increases.

Question 48

Figure: Consumer Surplus II
(Figure: Consumer Surplus II) Look at the figure Consumer Surplus II.If the price of the good decreases from $2 to $1, consumer surplus will increase by:
A.$5.
B.$10.
C.$25.
D.$35.

Question 49

Figure: Consumer Surplus I
(Figure: Consumer Surplus I) Look at the figure Consumer Surplus I.If the price rises from P₁ to P₂, consumer surplus decreases by the area:
A.ABP₂.
B.AFP₁.
C.BGF.
D.P₁P₂BF.

Question 50

Along a given demand curve, a decrease in the price of a good:
A.will increase consumer surplus.
B.will decrease consumer surplus.
C.will have no effect on consumer surplus.
D.It's impossible to tell what will happen to consumer surplus.

Question 51

Figure: Consumer Surplus I
(Figure: Consumer Surplus I) Look at the figure Consumer Surplus I.If the price falls from P₂ to P₁, consumer surplus increases by the area:
A.ABP₂.
B.AFP₁.
C.BGF.
D.P₁P₂BF.

Question 52

Figure: The Market for Hamburgers (Figure: The Market for Hamburgers) Look at the figure The Market for Hamburgers.The figure shows the weekly market for hamburgers in Tuscaloosa.If the price of a hamburger falls from $2 to $1.50, the gain in consumer surplus to consumers who are persuaded to buy at the lower price (and who were not buying when the price was $2) is equal to:

A)$100.
B)$75.
C)$50.
D)$25.

Question 53

(Table: Producer Surplus and Phantom Tickets) Look at the table Producer Surplus and Phantom
Tickets.If the price for Phantom tickets is $140 and there is no other market for tickets, total producer surplus for these five students is:
A.$139.
B.$110.
C.$40.
D.$379.

Question 54

Figure: Consumer Surplus III
(Figure: Consumer Surplus III) Look at the figure Consumer Surplus III.In the figure, when the price rises from $30 to $35, consumer surplus ________ for a total consumer surplus of _.
A.decreases by $15; $34
B.increases by $15; $64
C.increases by $25; $74
D.decreases by $5; $44

Question 55

Figure: Consumer Surplus II
(Figure: Consumer Surplus II) Look at the figure Consumer Surplus II.If the price of the good is $4, consumer surplus will equal:
A.$5.
B.$10.
C.$20.
D.$40.

Question 56

(Table: Producer Surplus and Phantom Tickets) Look at the table Producer Surplus and Phantom Tickets.If the price for Phantom tickets is $55, which student has the highest individual producer surplus?
A.Tim
B.Laura
C.Rick
D.Ralph

Question 57

Figure: Consumer Surplus I
(Figure: Consumer Surplus I) Look at the figure Consumer Surplus I.At a price of P₁, consumer surplus equals the area:
A.ABP₂.
B.AFP₁.
C.AQ₃0.
D.P₁P₂BF.

Question 58

Figure: The Market for Hamburgers
(Figure: The Market for Hamburgers) Look at the figure The Market for Hamburgers.The figure shows the weekly market for hamburgers in Tuscaloosa.If the price of a burger is $2, consumer surplus will equal:
A.$650.
B.$400.
C.$225.
D.$450.

Question 59

Anna is willing to sell her 20-year-old boat, but not for less than $2,300.For Anna, the cost of selling this boat is $2,300.
A.more than
B.less than
C.equal to
D.There is not enough information to answer the question.

Question 60

Figure: Consumer Surplus II
(Figure: Consumer Surplus II) Look at the figure Consumer Surplus II.If the price of the good is $2, consumer surplus will equal:
A.$30.
B.$45.
C.$60.
D.$90.

Question 61

We can measure total producer surplus for good X as:
A.the sum of the individual producer surpluses for all buyers of X.
B.the area below the supply curve for X and above the price of X.
C.the area bounded by the supply curve for X and the two axes.
D.the area between the demand curve for X and the supply curve for X.

Question 62

(Table: Producer Surplus) Look at the table Producer Surplus.If the price of a ticket to see The Nutty Nutcracker is $50 and there is no other market for tickets, then total producer surplus for the five students is:
A.$50.
B.$74.
C.$100.
D.$276.

Question 63

Producer surplus is represented by the area ________ the supply curve and the price.
A.above; above
B.above; below
C.below; above
D.below; below

Question 64

(Table: Producer Surplus and Phantom Tickets) Look at the table Producer Surplus and Phantom Tickets.Given the information in the table, if these students can sell their Phantom tickets for only $5, then:
A.Tim will be the only student not to sell his ticket.
B.Laura, Whitney, Ralph, and Rick will sell their tickets.
C.the total producer surplus for the five students will be $4.
D.the total producer surplus for the five students will be $330.

Question 65

Luis is willing to sell his pool table for $600, but if he gets $840, the producer surplus Luis receives is
________.
A.$600
B.$840
C.$240
D.$1,440

Question 66

(Table: Producer Surplus) Look at the table Producer Surplus.If the price of a ticket to see The Nutty Nutcracker is $50, then Dudley's producer surplus is:
A.$0.
B.$25.
C.$60.
D.$240.

Question 67

(Table: Producer Surplus) Look at the table Producer Surplus.If the price of a ticket to see The Nutty Nutcracker is $50, then Francisco's producer surplus is:
A.$0.
B.$40.
C.$90.
D.$240.

Question 68

Mountain River Adventures offers whitewater rafting trips down the Colorado River.It costs the firm
$100 for the first raft trip per day, $120 for the second, $140 for the third, and $160 for the fourth.If the market price for a raft trip is $150, Mountain River Adventures will offer trips per day and will
have producer surplus equal to _.
A.3; $90
B.3; $10
C.2; $220
D.4; $80

Question 69

(Table: Producer Surplus) Look at the table Producer Surplus.If the tickets to The Nutty Nutcracker are free and there is no other market for tickets, the total producer surplus for the five students is:
A.$276.
B.$100.
C.$74.
D.$0.

Question 70

0
A.$15.
B.$25.
C.$50.
D.$240.

Question 71

(Table: Producer Surplus) Look at the table Producer Surplus.If the price of a ticket to see The Nutty Nutcracker is $75, then Caitlin's producer surplus is:
A.$0.
B.$74.
C.$75.
D.$100.

Question 72

Figure: Monthly Supply of Bread
(Figure: Monthly Supply of Bread) Look at the figure Monthly Supply of Bread.The graph represents the monthly supply of bread at a local bakery.At the current price of $3 per loaf of bread, the bakery produces 120 loaves of bread per month.The producer surplus received by this bakery is equal to:

A)$120.
B)$60.
C)$360.
D)$180.

Question 73

Figure: Gain in Producer Surplus
(Figure: Gain in Producer Surplus) Look at the figure Gain in Producer Surplus.Which of the following area or areas represent producer surplus when the price is equal to P₂?
A.D, E, and F
B.B and C
C.D and E
D.A, B, and C

Question 74

Maria wants to get rid of her bookshelf.She is willing to give it away for free but her neighbor offers to pay $30 for it.Maria experiences a:
A.consumer surplus gain.
B.consumer surplus loss.
C.producer surplus gain.
D.producer surplus loss.

Question 75

Figure: Producer Surplus and Supply
(Figure: Producer Surplus and Supply) Look at the figure Producer Surplus and Supply.The difference between the total revenue received by sellers and their total cost is called surplus, which is
depicted by which area if the amount sold is E?
A.consumer;
B.ABD producer;
C.0BDE net;
0ADE
D.producer; ABD

Question 76

The total producer surplus for a good can be calculated in all except one of the following ways.Which is the exception?
A.the sum of the individual producer surpluses for all sellers of the good
B.the area below the supply curve for the good up to the quantity of the good sold
C.the area above the supply curve and below the price at which the good is being sold
D.the sum, for all sellers of the good, of the difference between what each seller receives
and the minimum amount he or she is willing to accept for selling the good.

Question 77

(Table: Producer Surplus and Phantom Tickets) Look at the table Producer Surplus and Phantom Tickets.Given the information in the table, if the price for Phantom tickets is $55, total producer surplus for the five students is:
A.$54.
B.$79.
C.$84.
D.$64.

Question 78

The total producer surplus in the Wisconsin milk market is represented by:
A.the sum of the individual producer surpluses in this market.
B.the sum of all prices paid multiplied by the number of gallons of milk sold.
C.the total revenue of the milk producers in Wisconsin.
D.the total cost of selling milk in Wisconsin.

Question 79

Producer surplus for an individual seller is equal to:
A.the price of the good minus the marginal cost of producing the good.
B.the marginal cost of the good minus the willingness to pay for the good.
C.the willingness to pay for the good minus the price of the good.
D.the marginal cost of the good minus the price of the good.

Question 80

(Table: Producer Surplus) Look at the table Producer Surplus.If the price of a ticket to see The Nutty Nutcracker is $75 and there is no other market for tickets, the total producer surplus for the five students is:
A.$190.
B.$139.
C.$75.
D.$40.