Question 1

Consumers' total benefit from consuming a good is equal to the

Accepted Answer

A)  total amount spent on the good. 
B)  consumer surplus on the quantity purchased. 
C)  consumer surplus plus the total amount spent on the good. 
D)  consumer surplus minus the total amount spent on the good. 
E)  total amount spent on the good divided by the number of units purchased. 
A)  total amount spent on the good. 
B)  consumer surplus on the quantity purchased. 
C)  consumer surplus plus the total amount spent on the good. 
D)  consumer surplus minus the total amount spent on the good. 
E)  total amount spent on the good divided by the number of units purchased.

Question 2

In order to efficiently allocate goods and services,we have to compare

Accepted Answer

A)  total cost to total benefit. 
B)  total cost to price. 
C)  marginal benefit to price. 
D)  marginal cost to marginal benefit. 
E)  price to marginal cost. 
A)  total cost to total benefit. 
B)  total cost to price. 
C)  marginal benefit to price. 
D)  marginal cost to marginal benefit. 
E)  price to marginal cost.

Question 3

$\begin{array}{c}
\begin{array}{c}
\text { Production } \
\text { point }\
\hline A\
B\
C\
D\
E 
\end{array}
\begin{array}{c}
\text { Fish } \
\text { (pounds) }\
\hline0 & \text { and } \
1 & \text { and }\
2 & \text { and } \
3 & \text { and }\
4 & \text { and }  
\end{array}
\begin{array}{c}
\text { Berries } \
\text { (pounds) } \
\hline50\
45\
35\
20\
0
\end{array}
\end{array}$

-The table above shows the production possibilities frontier for the nation of Isolanda.
a.Find the marginal cost of a pound of fish using the above PPF.
b.How does the marginal cost of a pound of fish change as more fish are caught?

Accepted Answer

\[\begin{array} { c c } 
\begin{array} {

Question 4

When underproduction occurs,

Accepted Answer

A)  producers gain more surplus at the expense of consumers. 
B)  marginal cost is greater than marginal benefit. 
C)  consumer surplus increases to a harmful amount. 
D)  there is a deadweight loss that is borne by the entire society. 
E)  the deadweight loss harms only consumers. 
A)  producers gain more surplus at the expense of consumers. 
B)  marginal cost is greater than marginal benefit. 
C)  consumer surplus increases to a harmful amount. 
D)  there is a deadweight loss that is borne by the entire society. 
E)  the deadweight loss harms only consumers.

Question 5

Compare and contrast production efficiency and allocative efficiency.

Accepted Answer

Production efficiency means that we are

Question 6

An unequal distribution of income is considered fair according to Robert Nozick if

Accepted Answer

A)  marginal cost equals marginal benefit. 
B)  the cost of administering a welfare system is minimized. 
C)  property rights are enforced and voluntary exchange occurs. 
D)  the economy is producing its maximum total output. 
E)  resources are allocated using the command method. 
A)  marginal cost equals marginal benefit. 
B)  the cost of administering a welfare system is minimized. 
C)  property rights are enforced and voluntary exchange occurs. 
D)  the economy is producing its maximum total output. 
E)  resources are allocated using the command method.

Question 7

When society must decrease the production of something in order to produce more of another good or service,society has necessarily achieved

Accepted Answer

A)  only production efficiency. 
B)  only allocative efficiency. 
C)  both production efficiency and allocative efficiency. 
D)  a free lunch. 
E)  the maximum opportunity cost.. 
A)  only production efficiency. 
B)  only allocative efficiency. 
C)  both production efficiency and allocative efficiency. 
D)  a free lunch. 
E)  the maximum opportunity cost..

Question 8

If the demand for a good does not change,how will an increase in the price of that good affect the consumer surplus from it?

Accepted Answer

The consumer surplus equals the differen

Question 9

The marginal cost curve is

Accepted Answer

A)  downward sloping to reflect the bowed out PPF. 
B)  downward sloping as marginal benefits increase. 
C)  upward sloping because marginal cost falls as more of a good or service is produced. 
D)  upward sloping to reflect the increasing opportunity cost of producing one more unit. 
E)  U-shaped to reflect the bowed out PPF. 
A)  downward sloping to reflect the bowed out PPF. 
B)  downward sloping as marginal benefits increase. 
C)  upward sloping because marginal cost falls as more of a good or service is produced. 
D)  upward sloping to reflect the increasing opportunity cost of producing one more unit. 
E)  U-shaped to reflect the bowed out PPF.

Question 10

Although Jack and Vanessa were equally qualified,Jack was promoted to manager instead of Vanessa because the president of the company thought that the other employees would not respect a female manager.The resource,the management position,was allocated in what manner?

Accepted Answer

A)  sharing equally 
B)  contest 
C)  personal characteristics 
D)  command 
E)  lottery 
A)  sharing equally 
B)  contest 
C)  personal characteristics 
D)  command 
E)  lottery

Question 11

The figure above shows the market for pizza.
-In the figure above,if pizza production is restricted to 5,000 pizzas a day,the deadweight loss is

Accepted Answer

A)  $45,000 per day. 
B)  $12,500 per day. 
C)  $22,500 per day. 
D)  $90,000 per day. 
E)  zero. 
A)  $45,000 per day. 
B)  $12,500 per day. 
C)  $22,500 per day. 
D)  $90,000 per day. 
E)  zero.

Question 12

Which of the following can result in a market producing an inefficient quantity of a good?
i.competition
ii.an external cost or an external benefit
iii.a tax

Accepted Answer

A)  i only 
B)  iii only 
C)  ii only 
D)  ii and iii 
E)  i and iii 
A)  i only 
B)  iii only 
C)  ii only 
D)  ii and iii 
E)  i and iii

Question 13

-In the above figure,the market is at its equilibrium.Area A is equal to

Accepted Answer

A)  consumer surplus. 
B)  total revenue. 
C)  marginal benefit. 
D)  producer surplus. 
E)  total surplus. 
A)  consumer surplus. 
B)  total revenue. 
C)  marginal benefit. 
D)  producer surplus. 
E)  total surplus.

Question 14

Moving ________ along the marginal cost curve,the ________.

Accepted Answer

A)  upward; opportunity cost of one more unit increases 
B)  upward; marginal cost decreases 
C)  downward; marginal cost increases 
D)  upward; opportunity cost of one more unit does not change 
E)  downward; opportunity cost of one more unit does not change 
A)  upward; opportunity cost of one more unit increases 
B)  upward; marginal cost decreases 
C)  downward; marginal cost increases 
D)  upward; opportunity cost of one more unit does not change 
E)  downward; opportunity cost of one more unit does not change

Question 15

-In the above figure,if the market is in equilibrium,area A + area B + area C equals

Accepted Answer

A)  total surplus. 
B)  consumer surplus. 
C)  deadweight loss. 
D)  producer surplus. 
E)  total revenue. 
A)  total surplus. 
B)  consumer surplus. 
C)  deadweight loss. 
D)  producer surplus. 
E)  total revenue.

Question 16

Jenn is willing to pay $75 for a purse and the purse's price is $60.What is Jenn's consumer surplus on this purse?

Accepted Answer

The consumer surplus equals the differen

Question 17

The fair rules approach to fairness requires

Accepted Answer

A)  consumer surplus equals producer surplus. 
B)  income transfers from rich to poor. 
C)  property rights and voluntary exchange. 
D)  that marginal cost equal marginal benefit. 
E)  consumer surplus exceed producer surplus because there are more consumers than producers. 
A)  consumer surplus equals producer surplus. 
B)  income transfers from rich to poor. 
C)  property rights and voluntary exchange. 
D)  that marginal cost equal marginal benefit. 
E)  consumer surplus exceed producer surplus because there are more consumers than producers.

Question 18

-In the above figure,if the quantity is equal to 500,000 units,the deadweight loss is equal to

Accepted Answer

A)  area C. 
B)  area D + area I. 
C)  area B + area F. 
D)  area G + area H. 
E)  None of the above answers is correct because the deadweight loss is equal to zero. 
A)  area C. 
B)  area D + area I. 
C)  area B + area F. 
D)  area G + area H. 
E)  None of the above answers is correct because the deadweight loss is equal to zero.

Question 19

Resource use is allocative efficient

Accepted Answer

A)  when it is not possible to produce more of one good. 
B)  when we produce goods and services that we value most highly. 
C)  when most resources are fully employed. 
D)  at any point on the PPF. 
E)  at all points either on or within the PPF because all these production points are attainable. 
A)  when it is not possible to produce more of one good. 
B)  when we produce goods and services that we value most highly. 
C)  when most resources are fully employed. 
D)  at any point on the PPF. 
E)  at all points either on or within the PPF because all these production points are attainable.

Question 20

Which of the following is most closely related to the "fair results" approach to fairness?

Accepted Answer

A)  efficient resource use 
B)  having an equal income distribution 
C)  voluntary exchange 
D)  the command system of allocating resources 
E)  price hikes in a natural disaster 
A)  efficient resource use 
B)  having an equal income distribution 
C)  voluntary exchange 
D)  the command system of allocating resources 
E)  price hikes in a natural disaster

Consumers' total benefit from consuming a good is equal to the

In order to efficiently allocate goods and services,we have to compare

When underproduction occurs,

Compare and contrast production efficiency and allocative efficiency.

An unequal distribution of income is considered fair according to Robert Nozick if

When society must decrease the production of something in order to produce more of another good or service,society has necessarily achieved

If the demand for a good does not change,how will an increase in the price of that good affect the consumer surplus from it?

The marginal cost curve is

Although Jack and Vanessa were equally qualified,Jack was promoted to manager instead of Vanessa because the president of the company thought that the other employees would not respect a female manager.The resource,the management position,was allocated in what manner?

The figure above shows the market for pizza. -In the figure above,if pizza production is restricted to 5,000 pizzas a day,the deadweight loss is

Which of the following can result in a market producing an inefficient quantity of a good? i.competition ii.an external cost or an external benefit iii.a tax

-In the above figure,the market is at its equilibrium.Area A is equal to

Moving along the marginal cost curve,the .

-In the above figure,if the market is in equilibrium,area A + area B + area C equals

Jenn is willing to pay $75 for a purse and the purse's price is $60.What is Jenn's consumer surplus on this purse?

The fair rules approach to fairness requires

-In the above figure,if the quantity is equal to 500,000 units,the deadweight loss is equal to

Resource use is allocative efficient

Which of the following is most closely related to the "fair results" approach to fairness?

Getting Started

The U.S.and Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets with Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

Exam 6: Efficiency and Fairness of Markets

Consumers' total benefit from consuming a good is equal to the

In order to efficiently allocate goods and services,we have to compare

When underproduction occurs,

Compare and contrast production efficiency and allocative efficiency.

An unequal distribution of income is considered fair according to Robert Nozick if

When society must decrease the production of something in order to produce more of another good or service,society has necessarily achieved

If the demand for a good does not change,how will an increase in the price of that good affect the consumer surplus from it?

The marginal cost curve is

Although Jack and Vanessa were equally qualified,Jack was promoted to manager instead of Vanessa because the president of the company thought that the other employees would not respect a female manager.The resource,the management position,was allocated in what manner?

The figure above shows the market for pizza. -In the figure above,if pizza production is restricted to 5,000 pizzas a day,the deadweight loss is

Which of the following can result in a market producing an inefficient quantity of a good? i.competition ii.an external cost or an external benefit iii.a tax

-In the above figure,the market is at its equilibrium.Area A is equal to

Moving ________ along the marginal cost curve,the ________.

-In the above figure,if the market is in equilibrium,area A + area B + area C equals

Jenn is willing to pay $75 for a purse and the purse's price is $60.What is Jenn's consumer surplus on this purse?

The fair rules approach to fairness requires

-In the above figure,if the quantity is equal to 500,000 units,the deadweight loss is equal to

Resource use is allocative efficient

Which of the following is most closely related to the "fair results" approach to fairness?

Getting Started

The U.S.and Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets with Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

Moving along the marginal cost curve,the .