Question 1

To a seller, the cost of a good or service is ________ and the price is ________.

Accepted Answer

A) what must be given up to produce the good or service; what is received for the good or service 
B) what is received for the good or service; what must be given up to produce the good or service 
C) the producer surplus the seller receives; the consumer surplus the buyer receives 
D) the producer surplus the buyer receives; the consumer surplus the seller receives 
E) None of the above answers is correct. 
A) what must be given up to produce the good or service; what is received for the good or service 
B) what is received for the good or service; what must be given up to produce the good or service 
C) the producer surplus the seller receives; the consumer surplus the buyer receives 
D) the producer surplus the buyer receives; the consumer surplus the seller receives 
E) None of the above answers is correct.

Question 2

A supply curve shows the marginal

Accepted Answer

A) benefit consumers receive from consuming a good. 
B) profit businesses earn from selling a good. 
C) cost of producing the good. 
D) price paid for a good. 
E) benefit sellers receive from selling a good. 
A) benefit consumers receive from consuming a good. 
B) profit businesses earn from selling a good. 
C) cost of producing the good. 
D) price paid for a good. 
E) benefit sellers receive from selling a good.

Question 3

In the summer of 2008, the price of gasoline increased greatly. If the demand curve for gasoline did not shift, which of the following occurred?

Accepted Answer

A) Drivers received no consumer surplus after the price increase. 
B) Consumer surplus increased if drivers drove less. 
C) Consumer surplus decreased. 
D) If consumers drove the same amount, they received less total benefit. 
E) Both the marginal benefit from each gallon of gasoline and the consumer surplus from each gallon of gasoline decreased. 
A) Drivers received no consumer surplus after the price increase. 
B) Consumer surplus increased if drivers drove less. 
C) Consumer surplus decreased. 
D) If consumers drove the same amount, they received less total benefit. 
E) Both the marginal benefit from each gallon of gasoline and the consumer surplus from each gallon of gasoline decreased.

Question 4

A point on the demand curve shows the

Accepted Answer

A) minimum price that people are willing to pay for another unit of a good. 
B) dollars' worth of other goods that people must sacrifice to consume another unit of the good. 
C) maximum price that people are willing to pay for another unit of a good. 
D) consumer surplus a person gains from consuming a unit of a good. 
E) marginal benefit minus the consumer surplus from consuming another unit of a good. 
A) minimum price that people are willing to pay for another unit of a good. 
B) dollars' worth of other goods that people must sacrifice to consume another unit of the good. 
C) maximum price that people are willing to pay for another unit of a good. 
D) consumer surplus a person gains from consuming a unit of a good. 
E) marginal benefit minus the consumer surplus from consuming another unit of a good.

Question 5

Why is the demand curve the same as the marginal benefit curve?

Accepted Answer

The demand curve for a good tells us for

Question 6

What are the two ways demand curves can be interpreted?

Accepted Answer

Demand curves can be used to find either

Question 7

The "big tradeoff" refers to

Accepted Answer

A) producing capital goods instead of consumable goods. 
B) marginal benefit versus marginal cost. 
C) efficiency and fairness. 
D) taking an economics course instead of some other course. 
E) using market prices rather than a command system to allocate resources. 
A) producing capital goods instead of consumable goods. 
B) marginal benefit versus marginal cost. 
C) efficiency and fairness. 
D) taking an economics course instead of some other course. 
E) using market prices rather than a command system to allocate resources.

Question 8

Which of the following is a correct description of the supply curve?
I. The supply curve is also the marginal cost curve.
Ii. The supply curve shows the dollars' worth of other goods that we must sacrifice to produce another unit of a good.
Iii. The supply curve shows the additional cost of producing another unit of a good.

Accepted Answer

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

Question 9

Auditors working for a large accounting firm are often away from the office. When they are in the office, they are allowed to use any desk that is available. Which method is used to allocate desks?

Accepted Answer

A) lottery 
B) first-come, first-served 
C) command 
D) contest 
E) sharing equally 
A) lottery 
B) first-come, first-served 
C) command 
D) contest 
E) sharing equally

Question 10

Suppose you're willing to tutor a student for $10 an hour. The student pays you $15 an hour. What is your producer surplus?

Accepted Answer

A) $5 an hour 
B) $10 an hour 
C) $15 an hour 
D) $25 an hour 
E) more than $25 an hour 
A) $5 an hour 
B) $10 an hour 
C) $15 an hour 
D) $25 an hour 
E) more than $25 an hour

Question 11

If you split your dessert with your date, you are using a ________ allocation method.

Accepted Answer

A) first-come, first-served 
B) sharing equally 
C) contest 
D) personal characteristics 
E) command 
A) first-come, first-served 
B) sharing equally 
C) contest 
D) personal characteristics 
E) command

Question 12

Mary is willing to pay $50 for a Christmas tree, John is willing to pay $45 and Jeff is willing to pay $40. The price of a tree is $40. The total consumer surplus for Mary, John and Jeff taken together is

Accepted Answer

A) $15. 
B) $135. 
C) $40. 
D) $95. 
E) $120. 
A) $15. 
B) $135. 
C) $40. 
D) $95. 
E) $120.

Question 13

Suppose Dan is willing to pay a maximum of $3,000 for a piano, but finds one he can buy for $2,500. Dan's consumer surplus from this piano is

Accepted Answer

A) $5,500. 
B) $3,000. 
C) $2,500. 
D) $500. 
E) zero because he buys the piano. 
A) $5,500. 
B) $3,000. 
C) $2,500. 
D) $500. 
E) zero because he buys the piano.

Question 14

-The figure above shows the supply curve for soda. The market price is $1.00 per soda. The marginal cost of the 10,000th soda is

Accepted Answer

A) $0.00. 
B) $0.50. 
C) $1.00. 
D) more than $0.50 and less than $1.00. 
E)  None of the above answers is correct. 
A) $0.00. 
B) $0.50. 
C) $1.00. 
D) more than $0.50 and less than $1.00. 
E)  None of the above answers is correct.

Question 15

Allocative efficiency occurs when

Accepted Answer

A) the most highly valued goods and services are produced. 
B) all citizens have equal access to goods and services. 
C) the environment is protected at all cost. 
D) goods and services are free. 
E) production takes place at any point on the PPF. 
A) the most highly valued goods and services are produced. 
B) all citizens have equal access to goods and services. 
C) the environment is protected at all cost. 
D) goods and services are free. 
E) production takes place at any point on the PPF.

Question 16

At the current production point on a nation's production possibilities frontier, the marginal benefit of a slice of pizza is 500 tacos while the marginal cost of producing a slice of pizza is 750 tacos. For the nation to produce at the point of allocative efficiency, what should be done?

Accepted Answer

The marginal benefit of a slic

Question 17

All points on the production possibilities frontier

Accepted Answer

A) are production inefficient. 
B) achieve allocative efficiency. 
C) are production efficient but only one point achieves allocative efficiency. 
D) are allocatively efficient but only one point achieves production efficiency. 
E) are allocatively inefficient. 
A) are production inefficient. 
B) achieve allocative efficiency. 
C) are production efficient but only one point achieves allocative efficiency. 
D) are allocatively efficient but only one point achieves production efficiency. 
E) are allocatively inefficient.

Question 18

University of Colorado reserves 5,000 free tickets to each home football game for students. Students must stand in line to receive their ticket. Football tickets are allocated through which method?

Accepted Answer

A) market price 
B) sharing equally 
C) personal characteristics 
D) first-come, first-served 
E) force 
A) market price 
B) sharing equally 
C) personal characteristics 
D) first-come, first-served 
E) force

Question 19

Which of the following is true for taxes? They

Accepted Answer

A) are always administered fairly. 
B) are a necessary part of living in an economy with a fair distribution of income. 
C) are always administered without creating unfairness or inefficiency. 
D) are an involuntary transfer of private property. 
E) do not create a big tradeoff problem. 
A) are always administered fairly. 
B) are a necessary part of living in an economy with a fair distribution of income. 
C) are always administered without creating unfairness or inefficiency. 
D) are an involuntary transfer of private property. 
E) do not create a big tradeoff problem.

Question 20

If a landlord will rent an apartment only to married couples over 30 years old, the landlord is allocating resources using a ________ allocation method.

Accepted Answer

A) majority rule 
B) market price 
C) contest 
D) personal characteristics 
E) command 
A) majority rule 
B) market price 
C) contest 
D) personal characteristics 
E) command

To a seller, the cost of a good or service is and the price is .

A supply curve shows the marginal

In the summer of 2008, the price of gasoline increased greatly. If the demand curve for gasoline did not shift, which of the following occurred?

A point on the demand curve shows the

Why is the demand curve the same as the marginal benefit curve?

What are the two ways demand curves can be interpreted?

The "big tradeoff" refers to

Auditors working for a large accounting firm are often away from the office. When they are in the office, they are allowed to use any desk that is available. Which method is used to allocate desks?

Suppose you're willing to tutor a student for $10 an hour. The student pays you $15 an hour. What is your producer surplus?

If you split your dessert with your date, you are using a ________ allocation method.

Mary is willing to pay $50 for a Christmas tree, John is willing to pay $45 and Jeff is willing to pay $40. The price of a tree is $40. The total consumer surplus for Mary, John and Jeff taken together is

Suppose Dan is willing to pay a maximum of $3,000 for a piano, but finds one he can buy for $2,500. Dan's consumer surplus from this piano is

-The figure above shows the supply curve for soda. The market price is $1.00 per soda. The marginal cost of the 10,000th soda is

Allocative efficiency occurs when

At the current production point on a nation's production possibilities frontier, the marginal benefit of a slice of pizza is 500 tacos while the marginal cost of producing a slice of pizza is 750 tacos. For the nation to produce at the point of allocative efficiency, what should be done?

All points on the production possibilities frontier

University of Colorado reserves 5,000 free tickets to each home football game for students. Students must stand in line to receive their ticket. Football tickets are allocated through which method?

Which of the following is true for taxes? They

If a landlord will rent an apartment only to married couples over 30 years old, the landlord is allocating resources using a ________ allocation method.

Getting Started

The Us and Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Government Actions in Markets

Global Markets in Action

Externalities: Pollution, Education, and Health Care

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and Economic Growth

Money and the Monetary System

Aggregate Supply and Aggregate Demand

Fiscal Policy and Monetary Policy

Filters

Exam 6: Efficiency and Fairness of Markets

To a seller, the cost of a good or service is ________ and the price is ________.

A supply curve shows the marginal

In the summer of 2008, the price of gasoline increased greatly. If the demand curve for gasoline did not shift, which of the following occurred?

A point on the demand curve shows the

Why is the demand curve the same as the marginal benefit curve?

What are the two ways demand curves can be interpreted?

The "big tradeoff" refers to

Auditors working for a large accounting firm are often away from the office. When they are in the office, they are allowed to use any desk that is available. Which method is used to allocate desks?

Suppose you're willing to tutor a student for $10 an hour. The student pays you $15 an hour. What is your producer surplus?

If you split your dessert with your date, you are using a ________ allocation method.

Mary is willing to pay $50 for a Christmas tree, John is willing to pay $45 and Jeff is willing to pay $40. The price of a tree is $40. The total consumer surplus for Mary, John and Jeff taken together is

Suppose Dan is willing to pay a maximum of $3,000 for a piano, but finds one he can buy for $2,500. Dan's consumer surplus from this piano is

-The figure above shows the supply curve for soda. The market price is $1.00 per soda. The marginal cost of the 10,000th soda is

Allocative efficiency occurs when

At the current production point on a nation's production possibilities frontier, the marginal benefit of a slice of pizza is 500 tacos while the marginal cost of producing a slice of pizza is 750 tacos. For the nation to produce at the point of allocative efficiency, what should be done?

All points on the production possibilities frontier

University of Colorado reserves 5,000 free tickets to each home football game for students. Students must stand in line to receive their ticket. Football tickets are allocated through which method?

Which of the following is true for taxes? They

If a landlord will rent an apartment only to married couples over 30 years old, the landlord is allocating resources using a ________ allocation method.

Getting Started

The Us and Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Government Actions in Markets

Global Markets in Action

Externalities: Pollution, Education, and Health Care

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and Economic Growth

Money and the Monetary System

Aggregate Supply and Aggregate Demand

Fiscal Policy and Monetary Policy

Filters

To a seller, the cost of a good or service is and the price is .