Exam 4: Economic Efficiency,government Price Setting,and Taxes

Table 4-2 -Refer to Table 4-2.The table above lists the marginal cost of cowboy hats by The Waco Kid,a firm that specializes in producing western wear..If the price of cowboy hats increases from $38 to $46

Table 4-3 Table 4-3 shows the demand and supply schedules for labor market in the city of Pixley. -Refer to Table 4-3.If a minimum wage of $9.50 is mandated there will be a

Table 4-1 -Refer to Table 4-1.The table above lists the highest prices three consumers,Tom,Dick and Harriet,are willing to pay for a short-sleeved polo shirt.If the price of one of the shirts is $28 dollars

The graph below represents the market for lychee nuts.The equilibrium price is $7.00 per bushel,but the market price is $5.00 per bushel.Identify the areas representing consumer surplus,producer surplus,and deadweight loss at the equilibrium price of $7.00 and at the market price of $5.00.

Refer to Figure 4-3.At a price of $18 consumers are willing to buy 40 pounds of tiger shrimp.Is this an economically efficient quantity?

Shortage means the same thing as scarcity.

Figure 4-7 -Refer to Figure 4-7 which shows the market for vitamins.Suppose the government imposes a price ceiling of Pv.How will the price ceiling affect the quantity supplied,quantity demanded and quantity exchanged?

Suppliers will be willing to supply a product only if

Table 4-3 Table 4-3 shows the demand and supply schedules for labor market in the city of Pixley. -Refer to Table 4-3.If a minimum wage of $9.50 an hour is mandated,what is the quantity of labor supplied?

If,in a competitive market,marginal benefit is less than marginal cost,

Deadweight loss refers to the reduction in economic surplus resulting from a market not being in competitive equilibrium.

Which of the following statements best describes the concept of consumer surplus?

Table 4-3 Table 4-3 shows the demand and supply schedules for labor market in the city of Pixley. -Refer to Table 4-3.What is the equilibrium hourly wage (W*)and the equilibrium quantity of labor (Q*)?

Figure 4-5 Figure 4-5 shows the market for apartments in Springfield. Recently, the government imposed a rent ceiling of $1,000 per month. -Refer to Figure 4-5.What is the value of consumer surplus after the imposition of the ceiling?

Figure 4-1 Figure 4-1 shows Arnold's demand curve for burritos. -Refer to Figure 4-1.Arnold's marginal benefit from consuming the third burrito is

Figure 4-8 Figure 4-8 shows the market for beer. The government plans to impose a unit tax in this market. -Refer to Figure 4-8.As a result of the tax,is there a loss in consumer surplus?

Figure 4-1 Figure 4-1 shows Arnold's demand curve for burritos. -Refer to Figure 4-1.If the market price is $1.00,what is the maximum number of burritos that Arnold will buy?