Question 1

What is the "big tradeoff"?

Accepted Answer

The "big tradeoff" is the tradeoff betwe

Question 2

When there is a cost or benefit that affects someone other than the seller and buyer, then there is

Accepted Answer

A) a tax. 
B) a subsidy. 
C) a quantity regulation. 
D) a price regulation. 
E) an externality. 
A) a tax. 
B) a subsidy. 
C) a quantity regulation. 
D) a price regulation. 
E) an externality.

Question 3

When there is market failure so that a market produces less than the efficient amount,

Accepted Answer

A) consumer surplus definitely is larger than when the efficient quantity is produced. 
B) the sum of producer surplus and consumer surplus is larger than when the efficient quantity is produced. 
C) there is a deadweight loss. 
D) consumers definitely lose and producers definitely gain. 
E) consumers definitely gain and producers definitely lose. 
A) consumer surplus definitely is larger than when the efficient quantity is produced. 
B) the sum of producer surplus and consumer surplus is larger than when the efficient quantity is produced. 
C) there is a deadweight loss. 
D) consumers definitely lose and producers definitely gain. 
E) consumers definitely gain and producers definitely lose.

Question 4

As more of a good is consumed, the marginal benefit of the good

Accepted Answer

A) increases. 
B) decreases. 
C) remains constant. 
D) is unpredictable. 
E) first decreases and then increases. 
A) increases. 
B) decreases. 
C) remains constant. 
D) is unpredictable. 
E) first decreases and then increases.

Question 5

A benefit that accrues to people other than the buyer of a good is known as ________ benefit.

Accepted Answer

A) an internal 
B) an external 
C) a marginal 
D) a total 
E) a subsidized 
A) an internal 
B) an external 
C) a marginal 
D) a total 
E) a subsidized

Question 6

The resource allocation method used for the online auctions on eBay is

Accepted Answer

A) market price. 
B) lottery. 
C) contest. 
D) first-come, first-served. 
E) sharing equally. 
A) market price. 
B) lottery. 
C) contest. 
D) first-come, first-served. 
E) sharing equally.

Question 7

Consumer surplus is equal to

Accepted Answer

A) marginal benefit minus price summed over the quantity consumed. 
B) price minus marginal benefit summed over the quantity consumed. 
C) marginal benefit summed over the quantity consumed. 
D) price multiplied by the quantity consumed. 
E) marginal benefit plus price summed over the quantity consumed. 
A) marginal benefit minus price summed over the quantity consumed. 
B) price minus marginal benefit summed over the quantity consumed. 
C) marginal benefit summed over the quantity consumed. 
D) price multiplied by the quantity consumed. 
E) marginal benefit plus price summed over the quantity consumed.

Question 8

Consumer surplus equals

Accepted Answer

A) producer surplus at a market equilibrium. 
B) marginal benefit minus price, summed over the quantity consumed. 
C) price minus marginal cost. 
D) the deadweight loss if there is underproduction. 
E) the deadweight loss plus the producer surplus. 
A) producer surplus at a market equilibrium. 
B) marginal benefit minus price, summed over the quantity consumed. 
C) price minus marginal cost. 
D) the deadweight loss if there is underproduction. 
E) the deadweight loss plus the producer surplus.

Question 9

Which describes the economic meanings of value and price?

Accepted Answer

A) Value is exchange worth minus marginal benefit and price is the dollars that must be paid. 
B) Value is the marginal benefit obtained and price is the dollars that must be paid. 
C) Value refers to the gain the producer gets from the good or service and price refers to the gain the consumer gets from the good or service. 
D) Value refers to the dollars that must be paid and price refers to the cost of producing the good. 
E) They are the same and both mean the dollars that must be paid. 
A) Value is exchange worth minus marginal benefit and price is the dollars that must be paid. 
B) Value is the marginal benefit obtained and price is the dollars that must be paid. 
C) Value refers to the gain the producer gets from the good or service and price refers to the gain the consumer gets from the good or service. 
D) Value refers to the dollars that must be paid and price refers to the cost of producing the good. 
E) They are the same and both mean the dollars that must be paid.

Question 10

Wal-Mart has a limited number of "Black Friday" (the day-after Thanksgiving Day)special items on sale at prices well below their typical price. Wal-Mart opens at 10 PM on Thanksgiving. Wal-Mart is using a ________ allocation method for these items.

Accepted Answer

A) first-come, first-served 
B) market price 
C) contest 
D) majority rule 
E) command 
A) first-come, first-served 
B) market price 
C) contest 
D) majority rule 
E) command

Question 11

The producer surplus of making and selling 10 chairs is found by

Accepted Answer

A) multiplying the selling price by 10. 
B) subtracting the marginal cost from the selling price for each chair and summing the differences for all 10 chairs. 
C) subtracting from the total revenue the cost of producing one chair multiplied by 10. 
D) adding the marginal cost and the price of all 10 chairs. 
E) None of the above answers is correct. 
A) multiplying the selling price by 10. 
B) subtracting the marginal cost from the selling price for each chair and summing the differences for all 10 chairs. 
C) subtracting from the total revenue the cost of producing one chair multiplied by 10. 
D) adding the marginal cost and the price of all 10 chairs. 
E) None of the above answers is correct.

Question 12

What are the two views of fairness?
 How does each view redistribution of income from the rich to the poor?

Accepted Answer

One view is that "it's not fair if the r

Question 13

-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

@#IMG-DLM& 
a. The table above shows the marginal

Question 14

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 15

Marginal benefit curves

Accepted Answer

A) have positive slopes. 
B) have negative slopes. 
C) are horizontal lines. 
D) are vertical lines. 
E) are upside-down U-shaped curves. 
A) have positive slopes. 
B) have negative slopes. 
C) are horizontal lines. 
D) are vertical lines. 
E) are upside-down U-shaped curves.

Question 16

What allocation method is the primary method used in the United States?

Accepted Answer

While all the different allocation metho

Question 17

-In the above figure, if the quantity is equal to 1,500,000 units, the deadweight is equal to

Accepted Answer

A) area A + area B. 
B) area C. 
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 A + area B. 
B) area C. 
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 18

Jose works at Intel. His manager tells him what work needs to be completed each month. Jose's resource, labor, is allocated with which of the following methods?

Accepted Answer

A) command 
B) majority rule 
C) force 
D) personal characteristics 
E) lottery 
A) command 
B) majority rule 
C) force 
D) personal characteristics 
E) lottery

Question 19

-In the figure above, if the market is at equilibrium, then the total consumer surplus equals the area ________ and the total producer surplus equals the area ________.

Accepted Answer

A) A; B 
B) B; C 
C) C; B 
D) A; C 
E) A + B; C 
A) A; B 
B) B; C 
C) C; B 
D) A; C 
E) A + B; C

Question 20

-The figure shows the demand curve for hotel rooms at a local resort.
a. If the hotel charges $120 per night, how many rooms will they rent?
b. If there are only 40 rooms available, how much are customers willing to pay for a room?
c. If 60 rooms are available, how much are customers willing to pay?
d. What do the dollars in your answer to part (c)represent?

Accepted Answer

a. At $120 a night, the hotel will rent

What is the "big tradeoff"?

When there is a cost or benefit that affects someone other than the seller and buyer, then there is

When there is market failure so that a market produces less than the efficient amount,

As more of a good is consumed, the marginal benefit of the good

A benefit that accrues to people other than the buyer of a good is known as ________ benefit.

The resource allocation method used for the online auctions on eBay is

Consumer surplus is equal to

Consumer surplus equals

Which describes the economic meanings of value and price?

Wal-Mart has a limited number of "Black Friday" (the day-after Thanksgiving Day)special items on sale at prices well below their typical price. Wal-Mart opens at 10 PM on Thanksgiving. Wal-Mart is using a ________ allocation method for these items.

The producer surplus of making and selling 10 chairs is found by

What are the two views of fairness? How does each view redistribution of income from the rich to the poor?

-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?

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

Marginal benefit curves

What allocation method is the primary method used in the United States?

-In the above figure, if the quantity is equal to 1,500,000 units, the deadweight is equal to

Jose works at Intel. His manager tells him what work needs to be completed each month. Jose's resource, labor, is allocated with which of the following methods?

-In the figure above, if the market is at equilibrium, then the total consumer surplus equals the area and the total producer surplus equals the area .

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

What is the "big tradeoff"?

When there is a cost or benefit that affects someone other than the seller and buyer, then there is

When there is market failure so that a market produces less than the efficient amount,

As more of a good is consumed, the marginal benefit of the good

A benefit that accrues to people other than the buyer of a good is known as ________ benefit.

The resource allocation method used for the online auctions on eBay is

Consumer surplus is equal to

Consumer surplus equals

Which describes the economic meanings of value and price?

Wal-Mart has a limited number of "Black Friday" (the day-after Thanksgiving Day)special items on sale at prices well below their typical price. Wal-Mart opens at 10 PM on Thanksgiving. Wal-Mart is using a ________ allocation method for these items.

The producer surplus of making and selling 10 chairs is found by

What are the two views of fairness? How does each view redistribution of income from the rich to the poor?

-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?

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

Marginal benefit curves

What allocation method is the primary method used in the United States?

-In the above figure, if the quantity is equal to 1,500,000 units, the deadweight is equal to

Jose works at Intel. His manager tells him what work needs to be completed each month. Jose's resource, labor, is allocated with which of the following methods?

-In the figure above, if the market is at equilibrium, then the total consumer surplus equals the area ________ and the total producer surplus equals the area ________.

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

-In the figure above, if the market is at equilibrium, then the total consumer surplus equals the area and the total producer surplus equals the area .