Question 1

Marginal benefit equals the

Accepted Answer

A)  benefit that a person receives from consuming another unit of a good. 
B)  additional efficiency from producing another unit of a good. 
C)  increase in profit from producing another unit of a good. 
D)  cost of producing another unit of a good. 
E)  total benefit from consuming all the units of the good or service. 
A)  benefit that a person receives from consuming another unit of a good. 
B)  additional efficiency from producing another unit of a good. 
C)  increase in profit from producing another unit of a good. 
D)  cost of producing another unit of a good. 
E)  total benefit from consuming all the units of the good or service.

Question 2

The demand curve is the same as another curve.Which curve is the same as the demand curve? Why are the curves the same?

Accepted Answer

The demand curve is the same as the marg

Question 3

Canned milk was only rationed to babies and small children during World War II.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 4

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 5

How can a person argue that health care services in America are provided efficiently,but not fairly?

Accepted Answer

The assertion that the health market is

Question 6

-The figure above shows the supply curve for soda.The market price is $1.00 per soda.The producer surplus from all the sodas sold is

Accepted Answer

A)  $0.00. 
B)  $15.00. 
C)  $20.00. 
D)  $1.00. 
E)  None of the above answers is correct. 
A)  $0.00. 
B)  $15.00. 
C)  $20.00. 
D)  $1.00. 
E)  None of the above answers is correct.

Question 7

Which of the following is part of the cost of income transfers?

Accepted Answer

A)  Tax-collecting agencies cost money to administer. 
B)  Taxing incomes encourages people to work harder. 
C)  Income transfers make the results more unfair. 
D)  Income transfers increase the size of the economic pie. 
E)  Income transfers are a similar to allocating resources using a lottery. 
A)  Tax-collecting agencies cost money to administer. 
B)  Taxing incomes encourages people to work harder. 
C)  Income transfers make the results more unfair. 
D)  Income transfers increase the size of the economic pie. 
E)  Income transfers are a similar to allocating resources using a lottery.

Question 8

The figure above shows the supply curve for pizza and the market price of pizza.
-In the figure above,the cost of producing 10,000 pizzas a day is

Accepted Answer

A)  $60,000. 
B)  $100,000. 
C)  $40,000. 
D)  $80,000. 
E)  $50,000. 
A)  $60,000. 
B)  $100,000. 
C)  $40,000. 
D)  $80,000. 
E)  $50,000.

Question 9

When the marginal cost of producing a bike is greater than the marginal benefit of the bike,for resource use to be allocatively efficient,

Accepted Answer

A)  more bikes should be produced. 
B)  fewer bikes should be produced. 
C)  no more and no fewer bikes should be produced. 
D)  it must be determined if the production of bikes can be increased. 
E)  people must be educated to demand more bikes. 
A)  more bikes should be produced. 
B)  fewer bikes should be produced. 
C)  no more and no fewer bikes should be produced. 
D)  it must be determined if the production of bikes can be increased. 
E)  people must be educated to demand more bikes.

Question 10

What must be true for a consumer to buy a good or service?

Accepted Answer

A)  The price must be equal to or less than the marginal benefit. 
B)  The total benefit received must equal the total spent to buy the good or service. 
C)  The consumer must be able to obtain some consumer surplus. 
D)  The consumer must not be able to produce the product. 
E)  The price must be equal to or greater than the marginal benefit. 
A)  The price must be equal to or less than the marginal benefit. 
B)  The total benefit received must equal the total spent to buy the good or service. 
C)  The consumer must be able to obtain some consumer surplus. 
D)  The consumer must not be able to produce the product. 
E)  The price must be equal to or greater than the marginal benefit.

Question 11

Shelby said to her friend,"I just bought a new pair of climbing shoes and I love them so much that I totally would have paid more for them." Shelby was describing the concept of

Accepted Answer

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

Question 12

The supply curve shows the

Accepted Answer

A)  marginal benefit of a firm producing another unit of a good. 
B)  dollars' worth of other goods and services we are willing to give up to get another unit of the good. 
C)  minimum price that firms must receive to supply a certain quantity of a good. 
D)  producer surplus of producing the good. 
E)  maximum price that firms will accept in order to supply a certain quantity of a good. 
A)  marginal benefit of a firm producing another unit of a good. 
B)  dollars' worth of other goods and services we are willing to give up to get another unit of the good. 
C)  minimum price that firms must receive to supply a certain quantity of a good. 
D)  producer surplus of producing the good. 
E)  maximum price that firms will accept in order to supply a certain quantity of a good.

Question 13

Allocative efficiency occurs

Accepted Answer

A)  anywhere inside or on the production possibilities frontier. 
B)  when the total cost of production is minimized. 
C)  at all points on the production possibilities frontier. 
D)  at only one point on the production possibilities frontier. 
E)  at the points where the production possibilities frontier crosses the horizontal or vertical axis. 
A)  anywhere inside or on the production possibilities frontier. 
B)  when the total cost of production is minimized. 
C)  at all points on the production possibilities frontier. 
D)  at only one point on the production possibilities frontier. 
E)  at the points where the production possibilities frontier crosses the horizontal or vertical axis.

Question 14

Which of the following is true?
i.Marginal cost is measured by the maximum price that consumers are willing to pay for another unit of a good or service.
ii.Producer surplus equals marginal benefit minus price,summed over the quantity produced.
iii.A supply curve is a marginal cost curve.

Accepted Answer

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

Question 15

Value and price can be compared by noting that

Accepted Answer

A)  they are the same thing. 
B)  value is always greater than price. 
C)  value is what we must pay while price is what we are willing to pay. 
D)  price is what we must pay and value is what we are willing to pay. 
E)  value is what the seller receives when we buy a good, and price is what we must pay when we buy a good. 
A)  they are the same thing. 
B)  value is always greater than price. 
C)  value is what we must pay while price is what we are willing to pay. 
D)  price is what we must pay and value is what we are willing to pay. 
E)  value is what the seller receives when we buy a good, and price is what we must pay when we buy a good.

Question 16

Allocative efficiency is achieved when the production is such that

Accepted Answer

A)  the marginal benefit exceeds the marginal cost by as much as possible. 
B)  marginal cost equals zero. 
C)  marginal benefit is equal to marginal cost. 
D)  the production point is on the PPF. 
E)  None of the above is true. 
A)  the marginal benefit exceeds the marginal cost by as much as possible. 
B)  marginal cost equals zero. 
C)  marginal benefit is equal to marginal cost. 
D)  the production point is on the PPF. 
E)  None of the above is true.

Question 17

As pointed out by the "big tradeoff," government action that redistributes incomes so that everyone has the same income leads to

Accepted Answer

A)  fairness according to the "fair rules" approach. 
B)  efficient markets. 
C)  resources being allocated according to a command system. 
D)  a smaller total output. 
E)  lower taxes on the rich than on the poor so that the rich do not lose their incentive to work. 
A)  fairness according to the "fair rules" approach. 
B)  efficient markets. 
C)  resources being allocated according to a command system. 
D)  a smaller total output. 
E)  lower taxes on the rich than on the poor so that the rich do not lose their incentive to work.

Question 18

Which of the following situations describing a resource allocation method most resembles the majority rule method?

Accepted Answer

A)  Seventy percent of Austin's chess club wanted to purchase new chess sets and thirty percent did not. The club purchased the sets. 
B)  Lattes are sold at Starbucks. 
C)  Food from the Weld County Food Bank is distributed to families in need. 
D)  Jose works at Intel. His manager tells him what work needs to be completed each month. 
E)  Matt's mother had the rule that whoever cuts the cake chooses their slice last. 
A)  Seventy percent of Austin's chess club wanted to purchase new chess sets and thirty percent did not. The club purchased the sets. 
B)  Lattes are sold at Starbucks. 
C)  Food from the Weld County Food Bank is distributed to families in need. 
D)  Jose works at Intel. His manager tells him what work needs to be completed each month. 
E)  Matt's mother had the rule that whoever cuts the cake chooses their slice last.

Question 19

Suppose Dan is willing to pay a maximum of $3,000 for a piano,but finds one he can buy for $2,500.Dan's consumer surplus from this piano is

Accepted Answer

A)  $5,500. 
B)  $3,000. 
C)  $2,500. 
D)  $500. 
E)  zero because he buys the piano. 
A)  $5,500. 
B)  $3,000. 
C)  $2,500. 
D)  $500. 
E)  zero because he buys the piano.

Question 20

If the government takes over the distribution of some scarce good in a time of a natural disaster and provides the good at no charge to users,what must also be done?

Accepted Answer

A)  The government must produce the good itself. 
B)  Some rationing mechanism must be set up to determine who gets the good. 
C)  Everyone hurt in the natural disaster must get one of the goods. 
D)  nothing 
E)  Because we live in a democracy, the government must use majority rule as the rationing mechanism. 
A)  The government must produce the good itself. 
B)  Some rationing mechanism must be set up to determine who gets the good. 
C)  Everyone hurt in the natural disaster must get one of the goods. 
D)  nothing 
E)  Because we live in a democracy, the government must use majority rule as the rationing mechanism.

Marginal benefit equals the

The demand curve is the same as another curve.Which curve is the same as the demand curve? Why are the curves the same?

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

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

How can a person argue that health care services in America are provided efficiently,but not fairly?

-The figure above shows the supply curve for soda.The market price is $1.00 per soda.The producer surplus from all the sodas sold is

Which of the following is part of the cost of income transfers?

The figure above shows the supply curve for pizza and the market price of pizza. -In the figure above,the cost of producing 10,000 pizzas a day is

When the marginal cost of producing a bike is greater than the marginal benefit of the bike,for resource use to be allocatively efficient,

What must be true for a consumer to buy a good or service?

Shelby said to her friend,"I just bought a new pair of climbing shoes and I love them so much that I totally would have paid more for them." Shelby was describing the concept of

The supply curve shows the

Allocative efficiency occurs

Which of the following is true? i.Marginal cost is measured by the maximum price that consumers are willing to pay for another unit of a good or service. ii.Producer surplus equals marginal benefit minus price,summed over the quantity produced. iii.A supply curve is a marginal cost curve.

Value and price can be compared by noting that

Allocative efficiency is achieved when the production is such that

As pointed out by the "big tradeoff," government action that redistributes incomes so that everyone has the same income leads to

Which of the following situations describing a resource allocation method most resembles the majority rule method?

Suppose Dan is willing to pay a maximum of $3,000 for a piano,but finds one he can buy for $2,500.Dan's consumer surplus from this piano is

If the government takes over the distribution of some scarce good in a time of a natural disaster and provides the good at no charge to users,what must also be done?

Getting Started

The U.S.and Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets with Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

Exam 6: Efficiency and Fairness of Markets

Marginal benefit equals the

The demand curve is the same as another curve.Which curve is the same as the demand curve? Why are the curves the same?

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

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

How can a person argue that health care services in America are provided efficiently,but not fairly?

-The figure above shows the supply curve for soda.The market price is $1.00 per soda.The producer surplus from all the sodas sold is

Which of the following is part of the cost of income transfers?

The figure above shows the supply curve for pizza and the market price of pizza. -In the figure above,the cost of producing 10,000 pizzas a day is

When the marginal cost of producing a bike is greater than the marginal benefit of the bike,for resource use to be allocatively efficient,

What must be true for a consumer to buy a good or service?

Shelby said to her friend,"I just bought a new pair of climbing shoes and I love them so much that I totally would have paid more for them." Shelby was describing the concept of

The supply curve shows the

Allocative efficiency occurs

Which of the following is true? i.Marginal cost is measured by the maximum price that consumers are willing to pay for another unit of a good or service. ii.Producer surplus equals marginal benefit minus price,summed over the quantity produced. iii.A supply curve is a marginal cost curve.

Value and price can be compared by noting that

Allocative efficiency is achieved when the production is such that

As pointed out by the "big tradeoff," government action that redistributes incomes so that everyone has the same income leads to

Which of the following situations describing a resource allocation method most resembles the majority rule method?

Suppose Dan is willing to pay a maximum of $3,000 for a piano,but finds one he can buy for $2,500.Dan's consumer surplus from this piano is

If the government takes over the distribution of some scarce good in a time of a natural disaster and provides the good at no charge to users,what must also be done?

Getting Started

The U.S.and Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets with Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters