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

Tom tunes pianos in his spare time for extra income.Buyers of his service are willing to pay $155 per tuning.One particular week,Tom is willing to tune the first piano for $120,the second piano for $125,the third piano for $140,and the fourth piano for $160.Assume Tom is rational in deciding how many pianos to tune.His producer surplus is

Figure 7-7 -Refer to Figure 7-7.If the price of the good is $9.50,then producer surplus is

Sarah buys a new MP3 player for $135.She receives consumer surplus of $25 on her purchase if her willingness to pay is

Figure 7-15 -Refer to Figure 7-15.If the government imposes a price floor of $60 in this market,then total surplus will be

A seller's opportunity cost measures the

Suppose there is an early freeze in California that reduces the size of the lemon crop.What happens to consumer surplus in the market for lemons?

Motor oil and gasoline are complements.If the price of motor oil increases,consumer surplus in the gasoline market

At Nick's Bakery,the cost to make homemade chocolate cake is $4 per cake.As a result of selling five cakes,Nick experiences a producer surplus in the amount of $17.50.Nick must be selling his cakes for

Figure 7-21 -Refer to Figure 7-21.Sellers whose costs are less than the equilibrium price are represented by which line segment?

When markets fail,public policy can potentially remedy the problem and increase economic efficiency.

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 there is only one unit of the good and if the buyers bid against each other for the right to purchase it,then the consumer surplus will be

Which tools allow economists to determine if the allocation of resources determined by free markets is desirable?

Total surplus is represented by the area

Table 7-2 This table refers to five possible buyers' willingness to pay for a case of Vanilla Coke. -Refer to Table 7-2.Which of the following is not true?

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 tickets sell for $25 each,then what is the total consumer surplus in the market?

Figure 7-12 -Refer to Figure 7-12.Area A represents

When a buyer's willingness to pay for a good is equal to the price of the good,the

Figure 7-18 -Refer to Figure 7-18.Assume demand increases and as a result,equilibrium price increases to $22 and equilibrium quantity increases to 110.The increase in producer surplus would be

Moving production from a high-cost producer to a low-cost producer will

Figure 7-3 -Refer to Figure 7-3.When the price falls from P1 to P2,which area represents the increase in consumer surplus to existing buyers?