Question 1

Consumer surplus equals the

Accepted Answer

A)  value to buyers minus the amount paid by buyers. 
B)  value to buyers minus the cost to sellers. 
C)  amount received by sellers minus the cost to sellers. 
D)  amount received by sellers minus the amount paid by buyers. 
A)  value to buyers minus the amount paid by buyers. 
B)  value to buyers minus the cost to sellers. 
C)  amount received by sellers minus the cost to sellers. 
D)  amount received by sellers minus the amount paid by buyers.

Question 2

Table 7-10
  
-Refer to Table 7-10.You want to hire a professional photographer to take pictures of your family.The table shows the costs of the four potential sellers in the local photography market.Which of the following graphs represents the market supply curve?

Accepted Answer

A)    
B)    
C)    
D) 
  
A)    
B)    
C)    
D)

Question 3

Cost is a measure of the

Accepted Answer

A)  seller's willingness to sell. 
B)  seller's producer surplus. 
C)  producer shortage. 
D)  seller's willingness to buy. 
A)  seller's willingness to sell. 
B)  seller's producer surplus. 
C)  producer shortage. 
D)  seller's willingness to buy.

Question 4

Figure 7-22
  
-Refer to Figure 7-22.At the quantity Q3,

Accepted Answer

A)  the market is in equilibrium. 
B)  consumer surplus is maximized. 
C)  the sum of consumer surplus and producer surplus is maximized. 
D)  the marginal value to buyers is less than the marginal cost to sellers. 
A)  the market is in equilibrium. 
B)  consumer surplus is maximized. 
C)  the sum of consumer surplus and producer surplus is maximized. 
D)  the marginal value to buyers is less than the marginal cost to sellers.

Question 5

Which of the following events would increase producer surplus?

Accepted Answer

A)  Sellers' costs stay the same and the price of the good increases. 
B)  Sellers' costs increase and the price of the good stays the same. 
C)  Sellers' costs increase and the price of the good decreases. 
D)  All of the above are correct. 
A)  Sellers' costs stay the same and the price of the good increases. 
B)  Sellers' costs increase and the price of the good stays the same. 
C)  Sellers' costs increase and the price of the good decreases. 
D)  All of the above are correct.

Question 6

Table 7-10
  
-Refer to Table 7-10.You and your best friend want to hire a professional photographer to take pictures of your two families.The table shows the costs of the four potential sellers in the local photography market.You and your friend agree to offer $500 for each session.Who accepts the offer,and what is the total producer surplus in the market?

Accepted Answer

A)  LeBron and Kobe; $500 
B)  Kevin and Steve; $500 
C)  LeBron and Kobe; $300 
D)  Kevin and Steve; $150 
A)  LeBron and Kobe; $500 
B)  Kevin and Steve; $500 
C)  LeBron and Kobe; $300 
D)  Kevin and Steve; $150

Question 7

Figure 7-13
  
-Refer to Figure 7-13.If the price of the good is $500,then producer surplus amounts to

Accepted Answer

A)  $450. 
B)  $575. 
C)  $700. 
D)  $800. 
A)  $450. 
B)  $575. 
C)  $700. 
D)  $800.

Question 8

Producer surplus is

Accepted Answer

A)  represented on a graph by the area below the demand curve and above the supply curve. 
B)  the amount a seller is paid minus the cost of production. 
C)  also referred to as excess supply. 
D)  All of the above are correct. 
A)  represented on a graph by the area below the demand curve and above the supply curve. 
B)  the amount a seller is paid minus the cost of production. 
C)  also referred to as excess supply. 
D)  All of the above are correct.

Question 9

Table 7-4
The numbers in Table 7-1 reveal the maximum willingness to pay for a ticket to a Chicago Cubs vs. St. Louis Cardinal's baseball game at Wrigley Field.
  
-Refer to Table 7-4.If you have a ticket that you sell to the group in an auction,what will be the selling price?

Accepted Answer

A)  $21 
B)  $26 
C)  $51 
D)  $61 
A)  $21 
B)  $26 
C)  $51 
D)  $61

Question 10

The cost of production plus producer surplus is the price a seller is paid.

Accepted Answer

A) True 
 B)False

Question 11

The area below the demand curve and above the supply curve measures the producer surplus in a market.

Accepted Answer

A) True 
 B)False

Question 12

Figure 7-13
  
-Refer to Figure 7-13.Producer surplus amounts to $300 if the price of the good is

Accepted Answer

A)  $300. 
B)  $350. 
C)  $400. 
D)  $450. 
A)  $300. 
B)  $350. 
C)  $400. 
D)  $450.

Question 13

A demand curve reflects each of the following except the

Accepted Answer

A)  willingness to pay of all buyers in the market. 
B)  value each buyer in the market places on the good. 
C)  highest price buyers are willing to pay for each quantity. 
D)  ability of buyers to obtain the quantity they desire. 
A)  willingness to pay of all buyers in the market. 
B)  value each buyer in the market places on the good. 
C)  highest price buyers are willing to pay for each quantity. 
D)  ability of buyers to obtain the quantity they desire.

Question 14

Table 7-5
For each of three potential buyers of oranges, the table displays the willingness to pay for the first three oranges of the day. Assume Alex, Barb, and Carlos are the only three buyers of oranges, and only three oranges can be supplied per day.
  
-Refer to Table 7-5.If the market price of an orange is $0.70,then the market quantity of oranges demanded per day is

Accepted Answer

A)  5. 
B)  6. 
C)  7. 
D)  9. 
A)  5. 
B)  6. 
C)  7. 
D)  9.

Question 15

Table 7-5
For each of three potential buyers of oranges, the table displays the willingness to pay for the first three oranges of the day. Assume Alex, Barb, and Carlos are the only three buyers of oranges, and only three oranges can be supplied per day.
  
-Refer to Table 7-5.If the market price of an orange increases from $0.60 to $1.05,then consumer surplus

Accepted Answer

A)  increases by $2.90. 
B)  decreases by $2.25. 
C)  decreases by $2.70. 
D)  decreases by $3.85. 
A)  increases by $2.90. 
B)  decreases by $2.25. 
C)  decreases by $2.70. 
D)  decreases by $3.85.

Question 16

Figure 7-8
  
-Refer to Figure 7-8.Which area represents producer surplus when the price is P2?

Accepted Answer

A)  BCG 
B)  ACH 
C)  ABGD 
D)  AHGB 
A)  BCG 
B)  ACH 
C)  ABGD 
D)  AHGB

Question 17

Inefficiency can be caused in a market by the presence of

Accepted Answer

A)  market power. 
B)  externalities. 
C)  imperfectly competitive markets. 
D)  All of the above are correct. 
A)  market power. 
B)  externalities. 
C)  imperfectly competitive markets. 
D)  All of the above are correct.

Question 18

Figure 7-2
  
-Refer to Figure 7-2.When the price rises from P1 to P2,which of the following statements is not true?

Accepted Answer

A)  The buyers who still buy the good are worse off because they now pay more. 
B)  Some buyers leave the market because they are not willing to buy the good at the higher price. 
C)  Buyers place a higher value on the good after the price increase. 
D)  Consumer surplus in the market falls. 
A)  The buyers who still buy the good are worse off because they now pay more. 
B)  Some buyers leave the market because they are not willing to buy the good at the higher price. 
C)  Buyers place a higher value on the good after the price increase. 
D)  Consumer surplus in the market falls.

Question 19

Figure 7-20
  
-Refer to Figure 7-20.The equilibrium allocation of resources is

Accepted Answer

A)  efficient because total surplus is maximized at the equilibrium. 
B)  efficient because consumer surplus is maximized at the equilibrium. 
C)  inefficient because consumer surplus is larger than producer surplus at the equilibrium. 
D)  inefficient because total surplus is maximized when 10 units of output are produced and sold. 
A)  efficient because total surplus is maximized at the equilibrium. 
B)  efficient because consumer surplus is maximized at the equilibrium. 
C)  inefficient because consumer surplus is larger than producer surplus at the equilibrium. 
D)  inefficient because total surplus is maximized when 10 units of output are produced and sold.

Question 20

Consumer surplus is

Accepted Answer

A)  a concept that helps us make normative statements about the desirability of market outcomes. 
B)  represented on a graph by the area below the demand curve and above the price. 
C)  a good measure of economic welfare if buyers' preferences are the primary concern. 
D)  All of the above are correct. 
A)  a concept that helps us make normative statements about the desirability of market outcomes. 
B)  represented on a graph by the area below the demand curve and above the price. 
C)  a good measure of economic welfare if buyers' preferences are the primary concern. 
D)  All of the above are correct.

Consumer surplus equals the

Table 7-10 -Refer to Table 7-10.You want to hire a professional photographer to take pictures of your family.The table shows the costs of the four potential sellers in the local photography market.Which of the following graphs represents the market supply curve?

Cost is a measure of the

Figure 7-22 -Refer to Figure 7-22.At the quantity Q3,

Which of the following events would increase producer surplus?

Figure 7-13 -Refer to Figure 7-13.If the price of the good is $500,then producer surplus amounts to

Producer surplus is

Table 7-4 The numbers in Table 7-1 reveal the maximum willingness to pay for a ticket to a Chicago Cubs vs. St. Louis Cardinal's baseball game at Wrigley Field. -Refer to Table 7-4.If you have a ticket that you sell to the group in an auction,what will be the selling price?

The cost of production plus producer surplus is the price a seller is paid.

The area below the demand curve and above the supply curve measures the producer surplus in a market.

Figure 7-13 -Refer to Figure 7-13.Producer surplus amounts to $300 if the price of the good is

A demand curve reflects each of the following except the

Figure 7-8 -Refer to Figure 7-8.Which area represents producer surplus when the price is P2?

Inefficiency can be caused in a market by the presence of

Figure 7-2 -Refer to Figure 7-2.When the price rises from P1 to P2,which of the following statements is not true?

Figure 7-20 -Refer to Figure 7-20.The equilibrium allocation of resources is

Consumer surplus is

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 Market For the Factors of Production.

Earnings and Discrimination.

Income Inequality and Poverty.

The Theory of Consumer Choice.

Frontiers in Microeconomics.

Filters

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

Consumer surplus equals the

Table 7-10 -Refer to Table 7-10.You want to hire a professional photographer to take pictures of your family.The table shows the costs of the four potential sellers in the local photography market.Which of the following graphs represents the market supply curve?

Cost is a measure of the

Figure 7-22 -Refer to Figure 7-22.At the quantity Q3,

Which of the following events would increase producer surplus?

Figure 7-13 -Refer to Figure 7-13.If the price of the good is $500,then producer surplus amounts to

Producer surplus is

Table 7-4 The numbers in Table 7-1 reveal the maximum willingness to pay for a ticket to a Chicago Cubs vs. St. Louis Cardinal's baseball game at Wrigley Field. -Refer to Table 7-4.If you have a ticket that you sell to the group in an auction,what will be the selling price?

The cost of production plus producer surplus is the price a seller is paid.

The area below the demand curve and above the supply curve measures the producer surplus in a market.

Figure 7-13 -Refer to Figure 7-13.Producer surplus amounts to $300 if the price of the good is

A demand curve reflects each of the following except the

Figure 7-8 -Refer to Figure 7-8.Which area represents producer surplus when the price is P2?

Inefficiency can be caused in a market by the presence of

Figure 7-2 -Refer to Figure 7-2.When the price rises from P1 to P2,which of the following statements is not true?

Figure 7-20 -Refer to Figure 7-20.The equilibrium allocation of resources is

Consumer surplus is

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 Market For the Factors of Production.

Earnings and Discrimination.

Income Inequality and Poverty.

The Theory of Consumer Choice.

Frontiers in Microeconomics.

Filters