Question 1

Which of the following is true regarding the equilibrium price in perfectly competitive markets in the long run?

Accepted Answer

A) It will equal the firm's long- and short-run average costs and also its marginal cost. 
B) It will equal the firm's long- and short-run average costs but not its marginal cost. 
C) It will equal the firm's long-run average costs and also its marginal cost but not its short-run costs. 
D) It will equal the firm's short-run average costs and also its marginal cost but not its long-run costs. 
A) It will equal the firm's long- and short-run average costs and also its marginal cost. 
B) It will equal the firm's long- and short-run average costs but not its marginal cost. 
C) It will equal the firm's long-run average costs and also its marginal cost but not its short-run costs. 
D) It will equal the firm's short-run average costs and also its marginal cost but not its long-run costs.

Question 2

The following table shows the marginal private benefits and marginal private cost of providing daycare spaces in the province:
  
-Refer to the above information to answer this question.In an effort to increase the number of daycare spaces,suppose the authorities give parents a subsidy of $150 for each child registered.What will be the new equilibrium fee?

Accepted Answer

A) $350. 
B) $450. 
C) $500. 
D) $550. 
E) $600. 
A) $350. 
B) $450. 
C) $500. 
D) $550. 
E) $600.

Question 3

All of the following,except one,are features of a public good.Which is the exception?

Accepted Answer

A) Public goods are products whose benefits are not affected by the number of users. 
B) Public goods could be produced by the market. 
C) Public goods are provided by the government. 
D) Public goods could not be produced by private firms at a profit. 
A) Public goods are products whose benefits are not affected by the number of users. 
B) Public goods could be produced by the market. 
C) Public goods are provided by the government. 
D) Public goods could not be produced by private firms at a profit.

Question 4

Which of the following is true concerning a public good?

Accepted Answer

A) It is both non-rival and non-excludable. 
B) It is non-rival but not necessarily non-excludable. 
C) It is non-excludable but not necessarily non-rival. 
D) It is neither non-rival nor non-excludable. 
A) It is both non-rival and non-excludable. 
B) It is non-rival but not necessarily non-excludable. 
C) It is non-excludable but not necessarily non-rival. 
D) It is neither non-rival nor non-excludable.

Question 5

The cumulative difference between what buyers are willing to pay and the price they actually pay is

Accepted Answer

A) producer surplus. 
B) deadweight loss. 
C) total economic surplus. 
D) conspicuous consumption. 
E) consumer surplus. 
A) producer surplus. 
B) deadweight loss. 
C) total economic surplus. 
D) conspicuous consumption. 
E) consumer surplus.

Question 6

The figure below shows the demand and supply of a certain product.

Accepted Answer

@#IMG-DLM& 
a)If this depicts an unregulated marke

Question 7

-Refer to Figure 9.10 to answer this question.Which of the following statements is true if external costs are recognized but external benefits are not?

Accepted Answer

A) The price would be P1. 
B) The price would be P2. 
C) The price would be P3. 
D) The price would be P4. 
A) The price would be P1. 
B) The price would be P2. 
C) The price would be P3. 
D) The price would be P4.

Question 8

All of the following,except one,are examples of quasi-public goods in Canada.Which is the exception?

Accepted Answer

A) Military defence. 
B) Postal services. 
C) Individual health care. 
D) Education. 
A) Military defence. 
B) Postal services. 
C) Individual health care. 
D) Education.

Question 9

All of the following,except one,are benefits of perfectly competitive markets.Which is the exception?

Accepted Answer

A) Competitive markets promote personal economic freedom. 
B) Competitive markets eliminate externalities. 
C) Ignoring externalities,competitive markets are productively efficient. 
D) Competitive markets are costless to implement. 
E) Ignoring externalities,competitive markets are allocatively efficient. 
A) Competitive markets promote personal economic freedom. 
B) Competitive markets eliminate externalities. 
C) Ignoring externalities,competitive markets are productively efficient. 
D) Competitive markets are costless to implement. 
E) Ignoring externalities,competitive markets are allocatively efficient.

Question 10

-Refer to the above graph to answer this question.In an unregulated market,what would be the equilibrium price and quantity?

Accepted Answer

A) $30 and 500. 
B) $40 and 800. 
C) $50 and 700. 
D) $50 and 900. 
E) $60 and 800. 
A) $30 and 500. 
B) $40 and 800. 
C) $50 and 700. 
D) $50 and 900. 
E) $60 and 800.

Question 11

-Refer to the diagram above.If the current price is $16.30 per unit,producer surplus equals

Accepted Answer

A) $1,400. 
B) $600. 
C) $423.50. 
D) $1,171.50. 
E) $1,350. 
A) $1,400. 
B) $600. 
C) $423.50. 
D) $1,171.50. 
E) $1,350.

Question 12

All of the following,except one,are examples of market failures.Which is the exception?

Accepted Answer

A) Competitive markets do not result in an equitable distribution of incomes and wealth. 
B) Competitive markets do not ensure that the economy will be stable. 
C) Competitive markets do not ensure that competition will continue. 
D) Competitive markets do not ensure that individuals get the type of jobs they would like. 
E) Competitive markets do not take externalities into consideration. 
A) Competitive markets do not result in an equitable distribution of incomes and wealth. 
B) Competitive markets do not ensure that the economy will be stable. 
C) Competitive markets do not ensure that competition will continue. 
D) Competitive markets do not ensure that individuals get the type of jobs they would like. 
E) Competitive markets do not take externalities into consideration.

Question 13

What is allocative efficiency?

Accepted Answer

A) Production of a combination of products that best satisfies consumers' demands. 
B) The maximization of inputs for a given level of output. 
C) The production of an output at the lowest possible cost. 
D) The minimization of output for a given level of inputs. 
A) Production of a combination of products that best satisfies consumers' demands. 
B) The maximization of inputs for a given level of output. 
C) The production of an output at the lowest possible cost. 
D) The minimization of output for a given level of inputs.

Question 14

If the price of a product is less than its marginal social costs,then:

Accepted Answer

A) Society would prefer more of this product being produced. 
B) Society would prefer less of this product being produced. 
C) External costs must be zero. 
D) Short-run average costs must be at minimum. 
A) Society would prefer more of this product being produced. 
B) Society would prefer less of this product being produced. 
C) External costs must be zero. 
D) Short-run average costs must be at minimum.

Question 15

Which of the following statements is true regarding marginal social costs?

Accepted Answer

A) They include external but not internal costs of production. 
B) They include internal but not external costs of production. 
C) They include both external and internal costs of production. 
D) They measure the difference between social benefits and social costs. 
A) They include external but not internal costs of production. 
B) They include internal but not external costs of production. 
C) They include both external and internal costs of production. 
D) They measure the difference between social benefits and social costs.

Question 16

Explain three ways in which the government can reduce pollution.

Accepted Answer

The three ways that government can reduc

Question 17

Suppose that a market is in equilibrium.The area between the demand curve and the market price is

Accepted Answer

A) total economic surplus. 
B) producer surplus. 
C) consumer surplus. 
D) the deadweight loss. 
E) the degree of overconsumption. 
A) total economic surplus. 
B) producer surplus. 
C) consumer surplus. 
D) the deadweight loss. 
E) the degree of overconsumption.

Question 18

09-05 Explain how governments try to encourage production of goods and services;such as education;that carry external benefits.
 09-18 Providing Subsidies
Added Y axis line.
  
-The diagram above represents an industry.Assuming that the market structure for this industry is perfect competition,the producer surplus is shown by the area:

Accepted Answer

A) BEC 
B) AEC 
C) AFC 
D) BED 
A) BEC 
B) AEC 
C) AFC 
D) BED

Question 19

Why does the market fail to produce public goods?

Accepted Answer

A) Because normally there is no demand for such goods. 
B) Because it is impossible for the producer to exclude non-buyers from enjoying the benefit. 
C) Because such products usually entail large external costs. 
D) Because their production normally leads to increased income inequality. 
A) Because normally there is no demand for such goods. 
B) Because it is impossible for the producer to exclude non-buyers from enjoying the benefit. 
C) Because such products usually entail large external costs. 
D) Because their production normally leads to increased income inequality.

Question 20

If external benefits are not integrated into the market,insufficient quantities of a product will be produced.

Accepted Answer

A) True 
 B)False

Which of the following is true regarding the equilibrium price in perfectly competitive markets in the long run?

All of the following,except one,are features of a public good.Which is the exception?

Which of the following is true concerning a public good?

The cumulative difference between what buyers are willing to pay and the price they actually pay is

The figure below shows the demand and supply of a certain product.

-Refer to Figure 9.10 to answer this question.Which of the following statements is true if external costs are recognized but external benefits are not?

All of the following,except one,are examples of quasi-public goods in Canada.Which is the exception?

All of the following,except one,are benefits of perfectly competitive markets.Which is the exception?

-Refer to the above graph to answer this question.In an unregulated market,what would be the equilibrium price and quantity?

-Refer to the diagram above.If the current price is $16.30 per unit,producer surplus equals

All of the following,except one,are examples of market failures.Which is the exception?

What is allocative efficiency?

If the price of a product is less than its marginal social costs,then:

Which of the following statements is true regarding marginal social costs?

Explain three ways in which the government can reduce pollution.

Suppose that a market is in equilibrium.The area between the demand curve and the market price is

Why does the market fail to produce public goods?

If external benefits are not integrated into the market,insufficient quantities of a product will be produced.

The Economic Problem

Demand and Supply: An Introduction

Demand and Supply: An Elaboration

Elasticity

Consumer Choice

A Firms Production Decisions and Costs in the Short Run

Costs in the Long Run

Perfect Competition

Monopoly

Imperfect Competition

The Factors of Production

International Trade

Filters

Exam 9: An Evaluation of Competitive Markets

Which of the following is true regarding the equilibrium price in perfectly competitive markets in the long run?

All of the following,except one,are features of a public good.Which is the exception?

Which of the following is true concerning a public good?

The cumulative difference between what buyers are willing to pay and the price they actually pay is

The figure below shows the demand and supply of a certain product.

-Refer to Figure 9.10 to answer this question.Which of the following statements is true if external costs are recognized but external benefits are not?

All of the following,except one,are examples of quasi-public goods in Canada.Which is the exception?

All of the following,except one,are benefits of perfectly competitive markets.Which is the exception?

-Refer to the above graph to answer this question.In an unregulated market,what would be the equilibrium price and quantity?

-Refer to the diagram above.If the current price is $16.30 per unit,producer surplus equals

All of the following,except one,are examples of market failures.Which is the exception?

What is allocative efficiency?

If the price of a product is less than its marginal social costs,then:

Which of the following statements is true regarding marginal social costs?

Explain three ways in which the government can reduce pollution.

Suppose that a market is in equilibrium.The area between the demand curve and the market price is

Why does the market fail to produce public goods?

If external benefits are not integrated into the market,insufficient quantities of a product will be produced.

The Economic Problem

Demand and Supply: An Introduction

Demand and Supply: An Elaboration

Elasticity

Consumer Choice

A Firms Production Decisions and Costs in the Short Run

Costs in the Long Run

Perfect Competition

Monopoly

Imperfect Competition

The Factors of Production

International Trade

Filters