Exam 7: Consumers, Producers, and the Efficiency of Markets

A buyer is willing to buy a product at a price greater than or equal to his willingness to pay, but would refuse to buy a product at a price less than his willingness to pay.

A seller's willingness to sell is

Figure 7-4 -Refer to Figure 7-4. When the price falls from P1 to P2, which area represents the increase in consumer surplus to new buyers entering the market?

Figure 7-34 -Refer to Figure 7-34. Suppose there is initially a price ceiling set at $4 in this market. How much is total producer surplus with the price ceiling in place?

Figure 7-30 -Refer to Figure 7-30. If the market equilibrium price is $120, how much is total consumer surplus?

Figure 7-34 -Refer to Figure 7-34. Suppose there is initially a price floor set at $10 in this market. If the government removed the price floor, by how much would total consumer surplus increase?

Table 7-11 The following table represents the costs of five possible sellers. -Refer to Table 7-11. If the market price is $1,000, the producer surplus in the market is

Figure 7-31 -Refer to Figure 7-31. If the market equilibrium price rises from $25 to $35, how much is the producer surplus for the producers entering the market after the price increase?

Figure 7-22 -Refer to Figure 7-22. If 40 units of the good are bought and sold, then

Figure 7-25 -Refer to Figure 7-25. Suppose the government imposes a price ceiling of $16 in this market. If the buyers with the highest willingness to pay purchase the good, then total surplus will be

Figure 7-32 -Refer to Figure 7-32. If the government imposed a price floor at $35 in this market, how much is consumer surplus?

Figure 7-11 -Refer to Figure 7-11. If the demand curve is D and the supply curve shifts from S' to S, what is the change in producer surplus?

Figure 7-24 -Refer to Figure 7-24. At equilibrium, consumer surplus is measured by the area

Figure 7-15 -Refer to Figure 7-15. Suppose producer surplus is larger than C but smaller than A+B+C. The price of the good must be

If producing a soccer ball costs Jake $5, and he sells it for $40, his producer surplus is $35.

Table 7-14 The only four producers in a market have the following costs: -Refer to Table 7-14. If Abbey, Bev, and Carl sell the good, and the resulting producer surplus is $55 altogether, then the price must have been

Producer surplus equals

Producer surplus is the cost of production minus the amount a seller is paid.

Figure 7-26 -Refer to Figure 7-26. At the equilibrium price, producer surplus is

Figure 7-27 -Refer to Figure 7-27. If the government mandated a price increase from P1 to a higher price, then