Question 1

When economists refer to "the invisible hand," what do they mean?

Accepted Answer

In his book, Wealth of Nations, Adam Smi

Question 2

The supply curve is upward sloping because of

Accepted Answer

A) increasing marginal cost. 
B) decreasing marginal benefit. 
C) decreasing marginal cost. 
D) increasing marginal benefit. 
E) increasing total cost. 
A) increasing marginal cost. 
B) decreasing marginal benefit. 
C) decreasing marginal cost. 
D) increasing marginal benefit. 
E) increasing total cost.

Question 3

-In the figure above, the equilibrium market price is $20. The producer surplus is shown by the area

Accepted Answer

A) A. 
B) B. 
C) A + B. 
D) A ÷ B. 
E) A - B. 
A) A. 
B) B. 
C) A + B. 
D) A ÷ B. 
E) A - B.

Question 4

Jake just bought a new hockey stick. When he was leaving the shop, he thought that he such a great deal and would have paid $50 more dollars for the stick. Jake received

Accepted Answer

A) producer surplus. 
B) equilibrium. 
C) marginal cost. 
D) total surplus. 
E) consumer surplus. 
A) producer surplus. 
B) equilibrium. 
C) marginal cost. 
D) total surplus. 
E) consumer surplus.

Question 5

A supply curve shows quantities supplied at various prices. It also shows the

Accepted Answer

A) total profit the firm earns at a given level of output. 
B) marginal benefit of the good. 
C) total cost of production. 
D) marginal cost of production. 
E) producer surplus, which is equal to the slope of the supply curve. 
A) total profit the firm earns at a given level of output. 
B) marginal benefit of the good. 
C) total cost of production. 
D) marginal cost of production. 
E) producer surplus, which is equal to the slope of the supply curve.

Question 6

Canned milk was only rationed to babies and small children during World War 2. This rationing was an example of allocation by

Accepted Answer

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

Question 7

-In the figure above, if the market price is $12, then the total consumer surplus is

Accepted Answer

A) $12. 
B) $10. 
C) minimized. 
D) $240. 
E) $480. 
A) $12. 
B) $10. 
C) minimized. 
D) $240. 
E) $480.

Question 8

The figure above shows the market for pizza.
-In the figure above, if pizza production increases to 15,000 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 9

The marginal benefit from buying a particular unit of a good

Accepted Answer

A) is the amount paid for the unit plus the consumer surplus of the unit. 
B) increases as market price increases. 
C) is the difference between the amount paid for the unit and the market price of the unit. 
D) is the difference between the total benefit of the unit and the marginal cost of producing that unit. 
E) None of the above answers is correct. 
A) is the amount paid for the unit plus the consumer surplus of the unit. 
B) increases as market price increases. 
C) is the difference between the amount paid for the unit and the market price of the unit. 
D) is the difference between the total benefit of the unit and the marginal cost of producing that unit. 
E) None of the above answers is correct.

Question 10

-The figure above shows Diane's demand curve for soda. The price of a soda is $1.00. Diane's consumer surplus from her 15th soda is

Accepted Answer

A) $0.00. 
B) $0.50. 
C) $1.00. 
D) $1.50. 
E) $2.50. 
A) $0.00. 
B) $0.50. 
C) $1.00. 
D) $1.50. 
E) $2.50.

Question 11

A supply curve is the same as a

Accepted Answer

A) total cost curve. 
B) marginal cost curve. 
C) total benefit curve. 
D) marginal benefit curve. 
E) deadweight loss curve. 
A) total cost curve. 
B) marginal cost curve. 
C) total benefit curve. 
D) marginal benefit curve. 
E) deadweight loss curve.

Question 12

Allocating resources by the order of someone in authority is a ________ allocation method.

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 13

"If there is an inefficient level of nursing care in South America, a deadweight loss exists." Is this statement true or false?

Accepted Answer

The statement is true. Anytime

Question 14

6.6 Chapter Figures
   
The figure above shows the PPF, marginal cost curve, and marginal benefit curve for pizza.
-In the figure above, when 4,000 pizzas are produced, the marginal benefit of a pizza ________ its marginal cost, which means ________ pizza is being produced.

Accepted Answer

A) exceeds its marginal cost; too little 
B) exceeds its marginal cost; too much 
C) is below its marginal cost; too much 
D) is below its marginal cost; too little 
E) equals its marginal cost; the efficient quantity of 
A) exceeds its marginal cost; too little 
B) exceeds its marginal cost; too much 
C) is below its marginal cost; too much 
D) is below its marginal cost; too little 
E) equals its marginal cost; the efficient quantity of

Question 15

In general, the marginal cost curve

Accepted Answer

A) has a positive slope. 
B) has a negative slope. 
C) is horizontal. 
D) is vertical. 
E) is U-shaped. 
A) has a positive slope. 
B) has a negative slope. 
C) is horizontal. 
D) is vertical. 
E) is U-shaped.

Question 16

Why do societies face a tradeoff between the size of the economic pie and the degree of equality with which it is shared?

Accepted Answer

A person's share of the economic pie is

Question 17

-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 18

If a seller charges a buyer the exact price the buyer is willing to pay, then the buyer would

Accepted Answer

A) not buy the good. 
B) receive the maximum consumer surplus. 
C) receive no benefit from the good. 
D) receive no consumer surplus from that unit of the good. 
E) suffer a deadweight loss from buying the good. 
A) not buy the good. 
B) receive the maximum consumer surplus. 
C) receive no benefit from the good. 
D) receive no consumer surplus from that unit of the good. 
E) suffer a deadweight loss from buying the good.

Question 19

Which of the following is true?
I. Production efficiency occurs only when resources are used to produce the combination of goods that has the greatest value.
Ii. Allocative efficiency occurs when marginal benefit equals marginal cost.
Iii. A demand curve is a marginal cost curve.

Accepted Answer

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

Question 20

-The figure above shows the supply curve for soda. The market price is $1.00 per soda. The ________ price that must be offered so that the 10,000th soda is produced is ________.

Accepted Answer

A) minimum; $0.50 
B) minimum; $1.00 
C) maximum; $0.50 
D) maximum; $1.00 
E) minimum; more than $0.50 but less than $1.00 
A) minimum; $0.50 
B) minimum; $1.00 
C) maximum; $0.50 
D) maximum; $1.00 
E) minimum; more than $0.50 but less than $1.00

When economists refer to "the invisible hand," what do they mean?

The supply curve is upward sloping because of

-In the figure above, the equilibrium market price is $20. The producer surplus is shown by the area

Jake just bought a new hockey stick. When he was leaving the shop, he thought that he such a great deal and would have paid $50 more dollars for the stick. Jake received

A supply curve shows quantities supplied at various prices. It also shows the

Canned milk was only rationed to babies and small children during World War 2. This rationing was an example of allocation by

-In the figure above, if the market price is $12, then the total consumer surplus is

The figure above shows the market for pizza. -In the figure above, if pizza production increases to 15,000 pizzas a day, the deadweight loss is

The marginal benefit from buying a particular unit of a good

-The figure above shows Diane's demand curve for soda. The price of a soda is $1.00. Diane's consumer surplus from her 15th soda is

A supply curve is the same as a

Allocating resources by the order of someone in authority is a ________ allocation method.

"If there is an inefficient level of nursing care in South America, a deadweight loss exists." Is this statement true or false?

6.6 Chapter Figures The figure above shows the PPF, marginal cost curve, and marginal benefit curve for pizza. -In the figure above, when 4,000 pizzas are produced, the marginal benefit of a pizza its marginal cost, which means pizza is being produced.

In general, the marginal cost curve

Why do societies face a tradeoff between the size of the economic pie and the degree of equality with which it is shared?

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

If a seller charges a buyer the exact price the buyer is willing to pay, then the buyer would

Which of the following is true? I. Production efficiency occurs only when resources are used to produce the combination of goods that has the greatest value. Ii. Allocative efficiency occurs when marginal benefit equals marginal cost. Iii. A demand curve is a marginal cost curve.

-The figure above shows the supply curve for soda. The market price is $1.00 per soda. The price that must be offered so that the 10,000th soda is produced is .

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

When economists refer to "the invisible hand," what do they mean?

The supply curve is upward sloping because of

-In the figure above, the equilibrium market price is $20. The producer surplus is shown by the area

Jake just bought a new hockey stick. When he was leaving the shop, he thought that he such a great deal and would have paid $50 more dollars for the stick. Jake received

A supply curve shows quantities supplied at various prices. It also shows the

Canned milk was only rationed to babies and small children during World War 2. This rationing was an example of allocation by

-In the figure above, if the market price is $12, then the total consumer surplus is

The figure above shows the market for pizza. -In the figure above, if pizza production increases to 15,000 pizzas a day, the deadweight loss is

The marginal benefit from buying a particular unit of a good

-The figure above shows Diane's demand curve for soda. The price of a soda is $1.00. Diane's consumer surplus from her 15th soda is

A supply curve is the same as a

Allocating resources by the order of someone in authority is a ________ allocation method.

"If there is an inefficient level of nursing care in South America, a deadweight loss exists." Is this statement true or false?

6.6 Chapter Figures The figure above shows the PPF, marginal cost curve, and marginal benefit curve for pizza. -In the figure above, when 4,000 pizzas are produced, the marginal benefit of a pizza ________ its marginal cost, which means ________ pizza is being produced.

In general, the marginal cost curve

Why do societies face a tradeoff between the size of the economic pie and the degree of equality with which it is shared?

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

If a seller charges a buyer the exact price the buyer is willing to pay, then the buyer would

Which of the following is true? I. Production efficiency occurs only when resources are used to produce the combination of goods that has the greatest value. Ii. Allocative efficiency occurs when marginal benefit equals marginal cost. Iii. A demand curve is a marginal cost curve.

-The figure above shows the supply curve for soda. The market price is $1.00 per soda. The ________ price that must be offered so that the 10,000th soda is produced is ________.

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

6.6 Chapter Figures The figure above shows the PPF, marginal cost curve, and marginal benefit curve for pizza. -In the figure above, when 4,000 pizzas are produced, the marginal benefit of a pizza its marginal cost, which means pizza is being produced.

-The figure above shows the supply curve for soda. The market price is $1.00 per soda. The price that must be offered so that the 10,000th soda is produced is .