Question 1

Government intervention in agricultural markets in the U.S.began

Accepted Answer

A) during World War II to ensure that enough food was available for domestic consumption. 
B) after World War I in order to assist farmers to adjust from a war-time economy to a peace-time economy. 
C) during the Great Depression. 
D) during the Korean War. 
A) during World War II to ensure that enough food was available for domestic consumption. 
B) after World War I in order to assist farmers to adjust from a war-time economy to a peace-time economy. 
C) during the Great Depression. 
D) during the Korean War.

Question 2

The sum of consumer surplus and producer surplus is equal to

Accepted Answer

A) the deadweight loss. 
B) the economic surplus. 
C) zero. 
D) total profit. 
A) the deadweight loss. 
B) the economic surplus. 
C) zero. 
D) total profit.

Question 3

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

Accepted Answer

A) the net benefit to consumers from participating in the market is greater than the net benefit to producers. 
B) the government must force producers to lower price in order to achieve economic efficiency. 
C) the quantity sold is greater than the equilibrium quantity. 
D) the quantity sold is less than the equilibrium quantity. 
A) the net benefit to consumers from participating in the market is greater than the net benefit to producers. 
B) the government must force producers to lower price in order to achieve economic efficiency. 
C) the quantity sold is greater than the equilibrium quantity. 
D) the quantity sold is less than the equilibrium quantity.

Question 4

Figure 4-4  
-Refer to Figure 4-4.The figure above represents the market for iced tea.Assume that this is a competitive market.If 20,000 units of iced tea are sold

Accepted Answer

A) the deadweight loss is equal to economic surplus. 
B) producer surplus equals consumer surplus. 
C) the marginal benefit of each of the 20,000 units of iced tea equals $3. 
D) marginal benefit is equal to marginal cost. 
A) the deadweight loss is equal to economic surplus. 
B) producer surplus equals consumer surplus. 
C) the marginal benefit of each of the 20,000 units of iced tea equals $3. 
D) marginal benefit is equal to marginal cost.

Question 5

Figure 4-1   Figure 4-1 shows Kendra's demand curve for ice cream cones.
-Refer to Figure 4-1.If the market price is $2.50,what is the maximum number of ice cream cones that Kendra will buy?

Accepted Answer

A) 1 
B) 2 
C) 3 
D) 4 
A) 1 
B) 2 
C) 3 
D) 4

Question 6

Figure 4-3   Figure 4-3 shows the market for granola.The market is initially in equilibrium at a price of PS1U1B11S1U1B0 and a quantity of QS1U1B11S1U1B0.Now suppose producers decide to cut output to QS1U1B12 S1U1B0in order to raise the price to PS1U1B12.S1U1B0
-Refer to Figure 4-3.At the price P2,consumers are willing to buy the Q2 pounds of granola.Is this an economically efficient quantity?

Accepted Answer

A) No,the marginal benefit of the last unit (Q2)exceeds the marginal cost of that last unit. 
B) Yes,otherwise consumers would not buy Q2 units. 
C) Yes,because the price P2 shows what consumers are willing to pay for the product. 
D) No,the marginal cost of the last unit (Q2)exceeds the marginal benefit of the last unit. 
A) No,the marginal benefit of the last unit (Q2)exceeds the marginal cost of that last unit. 
B) Yes,otherwise consumers would not buy Q2 units. 
C) Yes,because the price P2 shows what consumers are willing to pay for the product. 
D) No,the marginal cost of the last unit (Q2)exceeds the marginal benefit of the last unit.

Question 7

Table 4-6
  
-Refer to Table 4-6.The equations above describe the demand and supply for Aunt Maud's Premium Hand Lotion.The equilibrium price and quantity for Aunt Maud's lotion are $20 and 30 thousand units.What is the value of economic surplus in this market?

Accepted Answer

A) $600 thousand 
B) $1,050 thousand 
C) $1,500 thousand 
D) $2,100 thousand 
A) $600 thousand 
B) $1,050 thousand 
C) $1,500 thousand 
D) $2,100 thousand

Question 8

A black market is a market where buying and selling take place

Accepted Answer

A) at prices that violate government price regulations. 
B) in non-licensed shops and warehouses. 
C) after regular office hours. 
D) on foreign soil. 
A) at prices that violate government price regulations. 
B) in non-licensed shops and warehouses. 
C) after regular office hours. 
D) on foreign soil.

Question 9

Monique buys a new television for $795.She receives consumer surplus of $355 from the purchase.How much does Monique value her television?

Accepted Answer

A) $355 
B) $440 
C) $795 
D) $1150 
A) $355 
B) $440 
C) $795 
D) $1150

Question 10

Suppliers will be willing to supply a product in all of the following situations except when

Accepted Answer

A) the price received is greater than the additional cost of producing the product. 
B) the price received is at least equal to the additional cost of producing the product. 
C) the price received is equal to the additional cost of producing the product. 
D) the price received is less than the additional cost of producing the product. 
A) the price received is greater than the additional cost of producing the product. 
B) the price received is at least equal to the additional cost of producing the product. 
C) the price received is equal to the additional cost of producing the product. 
D) the price received is less than the additional cost of producing the product.

Question 11

Figure 4-1   Figure 4-1 shows Kendra's demand curve for ice cream cones.
-Refer to Figure 4-1.If the market price is $3.00,what is the consumer surplus on the second ice cream cone?

Accepted Answer

A) $0 
B) $0.50 
C) $3.00 
D) $5.50 
A) $0 
B) $0.50 
C) $3.00 
D) $5.50

Question 12

Government intervention in agriculture began in the United States in the 1890s.

Accepted Answer

A) True 
 B)False

Government intervention in agricultural markets in the U.S.began

The sum of consumer surplus and producer surplus is equal to

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

Figure 4-4 -Refer to Figure 4-4.The figure above represents the market for iced tea.Assume that this is a competitive market.If 20,000 units of iced tea are sold

Figure 4-1 Figure 4-1 shows Kendra's demand curve for ice cream cones. -Refer to Figure 4-1.If the market price is $2.50,what is the maximum number of ice cream cones that Kendra will buy?

Table 4-6 -Refer to Table 4-6.The equations above describe the demand and supply for Aunt Maud's Premium Hand Lotion.The equilibrium price and quantity for Aunt Maud's lotion are $20 and 30 thousand units.What is the value of economic surplus in this market?

A black market is a market where buying and selling take place

Monique buys a new television for $795.She receives consumer surplus of $355 from the purchase.How much does Monique value her television?

Suppliers will be willing to supply a product in all of the following situations except when

Figure 4-1 Figure 4-1 shows Kendra's demand curve for ice cream cones. -Refer to Figure 4-1.If the market price is $3.00,what is the consumer surplus on the second ice cream cone?

Government intervention in agriculture began in the United States in the 1890s.

Economics: Foundations and Models

Trade-Offs, Comparative Advantage, and the Market System

Where Prices Come From: The Interaction of Demand and Supply

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Comparative Advantage and the Gains From International Trade

GDP: Measuring Total Production and Income

Unemployment and Inflation

Economic Growth, the Financial System, and Business Cycles

Long-Run Economic Growth: Sources and Policies

Aggregate Expenditure and Output in the Short Run

Aggregate Demand and Aggregate Supply Analysis

Money,Banks,and the Federal Reserve System

Monetary Policy

Fiscal Policy

Inflation, Unemployment, and Federal Reserve Policy

Macroeconomics in an Open Economy

The International Financial System

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

Government intervention in agricultural markets in the U.S.began

The sum of consumer surplus and producer surplus is equal to

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

Figure 4-4 -Refer to Figure 4-4.The figure above represents the market for iced tea.Assume that this is a competitive market.If 20,000 units of iced tea are sold

Figure 4-1 Figure 4-1 shows Kendra's demand curve for ice cream cones. -Refer to Figure 4-1.If the market price is $2.50,what is the maximum number of ice cream cones that Kendra will buy?

Table 4-6 -Refer to Table 4-6.The equations above describe the demand and supply for Aunt Maud's Premium Hand Lotion.The equilibrium price and quantity for Aunt Maud's lotion are $20 and 30 thousand units.What is the value of economic surplus in this market?

A black market is a market where buying and selling take place

Monique buys a new television for $795.She receives consumer surplus of $355 from the purchase.How much does Monique value her television?

Suppliers will be willing to supply a product in all of the following situations except when

Figure 4-1 Figure 4-1 shows Kendra's demand curve for ice cream cones. -Refer to Figure 4-1.If the market price is $3.00,what is the consumer surplus on the second ice cream cone?

Government intervention in agriculture began in the United States in the 1890s.

Economics: Foundations and Models

Trade-Offs, Comparative Advantage, and the Market System

Where Prices Come From: The Interaction of Demand and Supply

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Comparative Advantage and the Gains From International Trade

GDP: Measuring Total Production and Income

Unemployment and Inflation

Economic Growth, the Financial System, and Business Cycles

Long-Run Economic Growth: Sources and Policies

Aggregate Expenditure and Output in the Short Run

Aggregate Demand and Aggregate Supply Analysis

Money,Banks,and the Federal Reserve System

Monetary Policy

Fiscal Policy

Inflation, Unemployment, and Federal Reserve Policy

Macroeconomics in an Open Economy

The International Financial System

Filters