Exam 4: Demand and Supply Applications

Related to the Economics in Practice on p. 79: If the supply of generators increases and the demand for generators increases, the equilibrium price for generators ________ and the equilibrium quantity of generators ________.

Refer to the information provided in Figure 4.5 below to answer the question(s) that follow. Figure 4.5 -Refer to Figure 4.5. The price of CD-Rom drives in the United States would be $15 per CD-Rom drive, and the United States would import 9 million CD-Rom drives if the United States imposed ________ tariff per CD-Rom drive on imported CD-Rom drives.

The government imposes a price ceiling on sugar that is above the market price. You are asked to suggest a rationing scheme that will minimize the misallocation of resources. You suggest

Refer to the information provided in Figure 4.5 below to answer the question(s) that follow. Figure 4.5 -Refer to Figure 4.5. Assume that initially there is free trade. The quantity of CD-Rom drives supplied by U.S. firms will increase by 3 million CD-Rom drives if the United States then imposes ________ tariff per CD-Rom drive on imported CD-Rom drives.

An example of a ________ would be the government setting the price of coffee below the equilibrium price.

The total of producer and consumer surplus is maximized when there is underproduction.

Refer to the information provided in Figure 4.4 below to answer the question(s) that follow. Figure 4.4 -Refer to Figure 4.4. The price of oil in the United States would be $125 per barrel, and the United States would import 6 million barrels of oil per day if the United States levies ________ per barrel tariff on imported oil.

An example of an effective price ceiling would be the government setting the price of wheat at ________ per bushel when the market price is at $4.25 per bushel.

If the market price of a basketball is $35 and the full cost of producing it is $20, then a basketball producing firm gets producer surplus of

If the government imposes a maximum price that is above the equilibrium price,

A deadweight loss occurs ________ in a market.

Refer to the information provided in Figure 4.5 below to answer the question(s) that follow. Figure 4.5 -Refer to Figure 4.5. Assume that initially there is free trade. If the United States then imposes a $10.00 tariff per CD-Rom drive on imported CD-Rom drives,

In the short run, it is necessary to nonprice ration a good whenever ________ exists.

Refer to the information provided in Figure 4.4 below to answer the question(s) that follow. Figure 4.4 -Refer to Figure 4.4. If a $25 per barrel tariff is levied on imported oil, the United States will

When there is underproduction in a market,

If the most someone is willing to pay for an airline ticket to Las Vegas is $300 and the market price of the ticket is $200, then this buyer will get consumer surplus of

In a "black market," goods are traded at market determined prices.

With price rationing, those who are both able and willing to pay for a product get it.

Refer to the information provided in Figure 4.3 below to answer the question(s) that follow. Figure 4.3 -Refer to Figure 4.3. At an effective price ceiling for pencils,

Consumer surplus describes a situation in which there is excess quantity supplied.