Question 1

Consumer surplus is represented by the area _____ the demand curve and _____ the market price.

Accepted Answer

A)  above; below 
B)  above; above 
C)  below; above 
D)  below; below 
A)  above; below 
B)  above; above 
C)  below; above 
D)  below; below

Question 2

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

Accepted Answer

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

Question 3

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?

Accepted Answer

A)  $0 
B)  $9 
C)  $31 
D)  $40 
A)  $0 
B)  $9 
C)  $31 
D)  $40

Question 4

Use the following to answer questions:
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:

Accepted Answer

A)  ABP2. 
B)  AFP1. 
C)  BGF. 
D)  P1P2BF. 
A)  ABP2. 
B)  AFP1. 
C)  BGF. 
D)  P1P2BF.

Question 5

Consumer surplus can be found by computing the area _____ the _____ curve and _____ the price.

Accepted Answer

A)  above; supply ; below 
B)  below; supply; above 
C)  below; demand; above 
D)  below; demand; below 
A)  above; supply ; below 
B)  below; supply; above 
C)  below; demand; above 
D)  below; demand; below

Question 6

Total surplus is:

Accepted Answer

A)  the sum of consumer and producer surplus. 
B)  measured as the area between the supply and demand curves from their beginnings to their ends. 
C)  the total net gain to consumers from trading in the market. 
D)  the total net gain to producers from trading in the market. 
A)  the sum of consumer and producer surplus. 
B)  measured as the area between the supply and demand curves from their beginnings to their ends. 
C)  the total net gain to consumers from trading in the market. 
D)  the total net gain to producers from trading in the market.

Question 7

Use the following to answer questions:  
-(Table: Producer Surplus and Phantom Tickets) The table Producer Surplus and Phantom Tickets shows the minimum price at which each of the students is willing to sell a ticket to Phantom of the Opera. Assume that each student has only one ticket to sell. If the price for Phantom tickets is $55, which student has the highest individual producer surplus?

Accepted Answer

A)  Tim 
B)  Laura 
C)  Rick 
D)  Ralph 
A)  Tim 
B)  Laura 
C)  Rick 
D)  Ralph

Question 8

Use the following to answer questions:  
-(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:

Accepted Answer

A)  $190. 
B)  $139. 
C)  $75. 
D)  $40. 
A)  $190. 
B)  $139. 
C)  $75. 
D)  $40.

Question 9

If total surplus falls, there may have been a(n) _____ in demand or a(n) _____ in supply.

Accepted Answer

A)  increase; decrease 
B)  increase; increase 
C)  decrease; decrease 
D)  decrease; increase 
A)  increase; decrease 
B)  increase; increase 
C)  decrease; decrease 
D)  decrease; increase

Question 10

For calculating producer surplus, it is important to distinguish between the minimum price at which a seller is willing to sell a good and the seller's cost.

Accepted Answer

A) True 
 B)False

Question 11

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 _____.

Accepted Answer

A)  four; $110 
B)  three; $230 
C)  three; $80 
D)  four; $80 
A)  four; $110 
B)  three; $230 
C)  three; $80 
D)  four; $80

Question 12

Use the following to answer questions:
Figure: Producer Surplus III  
-(Figure: Producer Surplus III) Look at the figure Producer Surplus III. If the price of the good increases from $3 to $4, producer surplus will increase by:

Accepted Answer

A)  $5. 
B)  $15. 
C)  $25. 
D)  $35. 
A)  $5. 
B)  $15. 
C)  $25. 
D)  $35.

Question 13

Use the following to answer questions:
Figure: The Market for Hamburgers  
-(Figure: The Market for Hamburgers) The figure The Market for Hamburgers shows the weekly market for hamburgers in Tuscaloosa. If 400 hamburgers are sold, consumer surplus will equal:

Accepted Answer

A)  $650. 
B)  $400. 
C)  $225. 
D)  $450. 
A)  $650. 
B)  $400. 
C)  $225. 
D)  $450.

Question 14

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 their total consumer surplus?

Accepted Answer

A)  $10 
B)  $35 
C)  $45 
D)  $60 
A)  $10 
B)  $35 
C)  $45 
D)  $60

Question 15

Luis is willing to sell his pool table for no less than $600, but if he gets $840, the producer surplus Luis receives is:

Accepted Answer

A)  $600. 
B)  $840. 
C)  $240. 
D)  $1,440. 
A)  $600. 
B)  $840. 
C)  $240. 
D)  $1,440.

Question 16

Use the following to answer questions:  
-(Table: Consumer Surplus and Phantom Tickets) The table Consumer Surplus and Phantom Tickets shows each student's willingness to pay for a Phantom of the Opera ticket. Assume that each student wants to buy one ticket. If the price of a ticket to see Phantom of the Opera is $50, then Robert's consumer surplus is:

Accepted Answer

A)  $60. 
B)  $50. 
C)  $10. 
D)  $240. 
A)  $60. 
B)  $50. 
C)  $10. 
D)  $240.

Question 17

Use the following to answer questions:  
-(Table: Willingness to Pay for Basketball Sneakers) The table Willingness to Pay for Basketball Sneakers shows each player's willingness to pay for basketball sneakers. Assume that each player wants to buy at most, one pair of sneakers. If the price of basketball sneakers is $125, which players will purchase sneakers?

Accepted Answer

A)  Jamichael and Javon 
B)  Jamichael and Corey 
C)  Jamichael, Corey, and Rudy 
D)  Jamichael, Corey, Rudy, and Ray 
A)  Jamichael and Javon 
B)  Jamichael and Corey 
C)  Jamichael, Corey, and Rudy 
D)  Jamichael, Corey, Rudy, and Ray

Question 18

If the cost to download a song from the Internet falls from $0.99 to $0.50 along an upward-sloping supply curve, producer surplus in the market for MP3 players is likely to:

Accepted Answer

A)  increase. 
B)  decrease. 
C)  not change. 
D)  We cannot determine what producer surplus will do without information about consumer surplus. 
A)  increase. 
B)  decrease. 
C)  not change. 
D)  We cannot determine what producer surplus will do without information about consumer surplus.

Question 19

There is a trade-off between equity and efficiency in that policies designed to promote equity often come at the cost of decreased efficiency.

Accepted Answer

A) True 
 B)False

Question 20

Use the following to answer questions:
Figure: Consumer Surplus III  
-(Figure: Consumer Surplus III) In the figure Consumer Surplus III, when the price rises from $30 to $35, consumer surplus _____ for a total consumer surplus of _____.

Accepted Answer

A)  decreases by $15; $34 
B)  increases by $15; $64 
C)  increases by $25; $74 
D)  decreases by $5; $44 
A)  decreases by $15; $34 
B)  increases by $15; $64 
C)  increases by $25; $74 
D)  decreases by $5; $44

Consumer surplus is represented by the area _ the demand curve and _ the market price.

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

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?

Use the following to answer questions: 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:

Consumer surplus can be found by computing the area ___ the _ curve and ___ the price.

Total surplus is:

Use the following to answer questions: -(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:

If total surplus falls, there may have been a(n) _ in demand or a(n) _ in supply.

For calculating producer surplus, it is important to distinguish between the minimum price at which a seller is willing to sell a good and the seller's cost.

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 _.

Use the following to answer questions: Figure: Producer Surplus III -(Figure: Producer Surplus III) Look at the figure Producer Surplus III. If the price of the good increases from $3 to $4, producer surplus will increase by:

Use the following to answer questions: Figure: The Market for Hamburgers -(Figure: The Market for Hamburgers) The figure The Market for Hamburgers shows the weekly market for hamburgers in Tuscaloosa. If 400 hamburgers are sold, consumer surplus will equal:

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 their total consumer surplus?

Luis is willing to sell his pool table for no less than $600, but if he gets $840, the producer surplus Luis receives is:

If the cost to download a song from the Internet falls from $0.99 to $0.50 along an upward-sloping supply curve, producer surplus in the market for MP3 players is likely to:

There is a trade-off between equity and efficiency in that policies designed to promote equity often come at the cost of decreased efficiency.

Use the following to answer questions: Figure: Consumer Surplus III -(Figure: Consumer Surplus III) In the figure Consumer Surplus III, when the price rises from $30 to $35, consumer surplus _ for a total consumer surplus of _.

First Principles

Economic Models: Trade-Offs and Trade 25

Supply and Demand

Price Controls and Quotas: Meddling With Markets

Elasticity

Taxes

International Trade

Decision Making by Individuals Firms

The Rational Consumer

Behind the Supply Curve: Inputs and Costs

Perfect Competition and the Supply Curve

Monopoly

Oligopoly

Monopolistic Competition and Product Differentiation

Externalities

Public Goods Common Resources

The Economics of the Welfare

Factor Markets and the Distribution of Income

Uncertainty, Risk, and Private Information

Filters

Exam 4: Consumer and Producer Surplus

Consumer surplus is represented by the area _____ the demand curve and _____ the market price.

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

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?

Use the following to answer questions: 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:

Consumer surplus can be found by computing the area _____ the _____ curve and _____ the price.

Total surplus is:

Use the following to answer questions: -(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:

If total surplus falls, there may have been a(n) _____ in demand or a(n) _____ in supply.

For calculating producer surplus, it is important to distinguish between the minimum price at which a seller is willing to sell a good and the seller's cost.

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 _____.

Use the following to answer questions: Figure: Producer Surplus III -(Figure: Producer Surplus III) Look at the figure Producer Surplus III. If the price of the good increases from $3 to $4, producer surplus will increase by:

Use the following to answer questions: Figure: The Market for Hamburgers -(Figure: The Market for Hamburgers) The figure The Market for Hamburgers shows the weekly market for hamburgers in Tuscaloosa. If 400 hamburgers are sold, consumer surplus will equal:

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 their total consumer surplus?

Luis is willing to sell his pool table for no less than $600, but if he gets $840, the producer surplus Luis receives is:

If the cost to download a song from the Internet falls from $0.99 to $0.50 along an upward-sloping supply curve, producer surplus in the market for MP3 players is likely to:

There is a trade-off between equity and efficiency in that policies designed to promote equity often come at the cost of decreased efficiency.

Use the following to answer questions: Figure: Consumer Surplus III -(Figure: Consumer Surplus III) In the figure Consumer Surplus III, when the price rises from $30 to $35, consumer surplus _____ for a total consumer surplus of _____.

First Principles

Economic Models: Trade-Offs and Trade 25

Supply and Demand

Price Controls and Quotas: Meddling With Markets

Elasticity

Taxes

International Trade

Decision Making by Individuals Firms

The Rational Consumer

Behind the Supply Curve: Inputs and Costs

Perfect Competition and the Supply Curve

Monopoly

Oligopoly

Monopolistic Competition and Product Differentiation

Externalities

Public Goods Common Resources

The Economics of the Welfare

Factor Markets and the Distribution of Income

Uncertainty, Risk, and Private Information

Filters

Consumer surplus is represented by the area _ the demand curve and _ the market price.

Use the following to answer questions: 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:

Consumer surplus can be found by computing the area ___ the _ curve and ___ the price.

If total surplus falls, there may have been a(n) _ in demand or a(n) _ in supply.

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 _.

Use the following to answer questions: Figure: Consumer Surplus III -(Figure: Consumer Surplus III) In the figure Consumer Surplus III, when the price rises from $30 to $35, consumer surplus _ for a total consumer surplus of _.