Question 1

Accepted Answer

Table 7-4The numbers in Table 7-1 reveal the maximum willingness to pay for a ticket to a Chicago Cubs vs. St. Louis Cardinal's baseball game at Wrigley Field. -Refer to Table 7-4. If you have two (essentially)  identical tickets that you sell to the group in an auction, what will be the selling price for each ticket?  ) undefined
 ) undefined

Question 2

Figure 7-13 
-Refer to Figure 7-13. If the equilibrium price rises from $60 to $120, what is the additional producer surplus to initial producers in the market?

Accepted Answer

A)   $1,200
B)   $2,400
C)   $3,600
D)   $4,800E) A) and D)
F) A) and B)

Question 3

Table 7-15
 
-Refer to Table 7-15. You want to hire a professional photographer to take pictures of your family. The table shows the costs of the four potential sellers in the local photography market. You take bids from the sellers. Who offers the winning bid, and what does he offer to charge for the photography session?

Accepted Answer

A)   Steve; more than $400 but less than $450
B)   Steve; $399
C)   LeBron; more than $700
D)   LeBron; more than $600 but less than $700E) B) and D)
F) B) and C)

Question 4

Suppose Lauren, Leslie and Lydia all purchase bulletin boards for their rooms for $15 each. Lauren's willingness to pay was $35, Leslie's willingness to pay was $25, and Lydia's willingness to pay was $30. Total consumer surplus for these three would be

Accepted Answer

A)   $15.
B)   $30.
C)   $45.
D)   $90.E) C) and D)
F) A) and C)

Question 5

Figure 7-26 
-Refer to Figure 7-26. If the government imposes a price floor of $90 in this market, then consumer surplus will be

Accepted Answer

A)   $225.
B)   $450.
C)   $975.
D)   $1,350E) A) and B)
F) B) and C)

Question 6

Producer surplus measures the

Accepted Answer

A)   benefits to sellers of participating in a market.
B)   costs to sellers of participating in a market.
C)   price that buyers are willing to pay for sellers' output of a good or service.
D)   benefit to sellers of producing a greater quantity of a good or service than buyers demand.E) C) and D)
F) A) and B)

Question 7

Figure 7-11 
-Refer to Figure 7-11. If the supply curve is S, the demand curve is D, and the equilibrium price is $100, what is the producer surplus?

Accepted Answer

A)   $625
B)   $1,250
C)   $2,500
D)   $5,000E) All of the above
F) B) and C)

Question 8

Scenario 7-1
Suppose market demand is given by the equation 
-Refer to Scenario 7-1. If the market equilibrium price falls from $10 to $5, what is the change in total consumer surplus in the market?

Accepted Answer

Consumer s...

Question 9

Figure 7-14 
-Refer to Figure 7-14. At the equilibrium price, producer surplus is

Accepted Answer

A)   $800.
B)   $400.
C)   $450.
D)   $900.E) All of the above
F) B) and C)

Question 10

Moving production from a high-cost producer to a low-cost producer will

Accepted Answer

A)   lower total surplus.
B)   raise total surplus.
C)   lower producer surplus.
D)   raise producer surplus but lower consumer surplus.E) A) and D)
F) None of the above

Question 11

Total surplus in a market is equal to

Accepted Answer

A)   value to buyers - amount paid by buyers.
B)   amount received by sellers - costs of sellers.
C)   value to buyers - costs of sellers.
D)   amount received by sellers - amount paid by buyers.E) C) and D)
F) A) and B)

Question 12

Table 7-4
The numbers in Table 7-1 reveal the maximum willingness to pay for a ticket to a Chicago Cubs vs. St. Louis Cardinal's baseball game at Wrigley Field.
 
-Refer to Table 7-4. If tickets sell for $25 each, then what is the total consumer surplus in the market?

Accepted Answer

A)   $25
B)   $35
C)   $60
D)   $110E) A) and D)
F) B) and C)

Question 13

Total surplus is

Accepted Answer

A)   the total cost to sellers of providing the good minus the total value of the good to buyers.
B)   the total value of the good to buyers minus the cost to sellers of providing the good.
C)   the difference between consumer surplus and sellers' cost.
D)   always smaller than producer surplus.E) A) and D)
F) All of the above

Question 14

Figure 7-19 
-Refer to Figure 7-19. At the equilibrium price, total surplus is

Accepted Answer

A)   $125.
B)   $450.
C)   $250.
D)   $500.E) None of the above
F) All of the above

Question 15

If the cost of producing sofas decreases, then consumer surplus in the sofa market will

Accepted Answer

A)   increase.
B)   decrease.
C)   remain constant.
D)   increase for some buyers and decrease for other buyers.E) None of the above
F) A) and B)

Question 16

Total surplus in a market is consumer surplus minus producer surplus.

Accepted Answer

A) True 
 B)False

Question 17

Table 7-5
For each of three potential buyers of oranges, the table displays the willingness to pay for the first three oranges of the day. Assume Allison, Bob, and Charisse are the only three buyers of oranges, and only three oranges can be supplied per day.
 
-Refer to Table 7-5. The market quantity of oranges demanded per day is exactly 7 if the price of an orange, P, satisfies

Accepted Answer

A)   $0.60 
B)   $0.60 
C)   $0.25 
D)   $0.25 < P < $0.60.E) All of the above
F) B) and C)

Question 18

Figure 7-7 
-Refer to Figure 7-7. What is the consumer surplus if the price is $100?

Accepted Answer

A)   $2,500
B)   $5,000
C)   $10,000
D)   $20,000E) A) and D)
F) B) and C)

Question 19

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

Accepted Answer

A)   Producer surplus increases by $3,125.
B)   Producer surplus increases by $5,625.
C)   Producer surplus decreases by $3,125.
D)   Producer surplus decreases by $5,625.E) A) and B)
F) C) and D)

Question 20

Which of the following statements is not correct?

Accepted Answer

A)   An invisible hand leads buyers and sellers to an equilibrium that maximizes total surplus.
B)   Market power can cause markets to be inefficient.
C)   Externalities can cause markets to be inefficient.
D)   The invisible hand can remedy all types of market failures.E) B) and D)
F) B) and C)

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

Moving production from a high-cost producer to a low-cost producer will

Correct Answer
verified

Table 7-4 The numbers in Table 7-1 reveal the maximum willingness to pay for a ticket to a Chicago Cubs vs. St. Louis Cardinal's baseball game at Wrigley Field. -Refer to Table 7-4. If tickets sell for $25 each, then what is the total consumer surplus in the market?

Correct Answer
verified

Figure 7-11 -Refer to Figure 7-11. If the supply curve is S, the demand curve is D, and the equilibrium price is $100, what is the producer surplus?

Correct Answer
verified

Correct Answer
verified

Figure 7-13 -Refer to Figure 7-13. If the equilibrium price rises from $60 to $120, what is the additional producer surplus to initial producers in the market?

Correct Answer
verified

Total surplus in a market is equal to

Correct Answer
verified

Producer surplus measures the

Correct Answer
verified

Figure 7-19 -Refer to Figure 7-19. At the equilibrium price, total surplus is

Correct Answer
verified

Total surplus is

Correct Answer
verified

Figure 7-7 -Refer to Figure 7-7. What is the consumer surplus if the price is $100?

Correct Answer
verified

Correct Answer
verified

Suppose Lauren, Leslie and Lydia all purchase bulletin boards for their rooms for $15 each. Lauren's willingness to pay was $35, Leslie's willingness to pay was $25, and Lydia's willingness to pay was $30. Total consumer surplus for these three would be

Correct Answer
verified

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

Correct Answer
verified

Which of the following statements is not correct?

Correct Answer
verified

Figure 7-26 -Refer to Figure 7-26. If the government imposes a price floor of $90 in this market, then consumer surplus will be

Correct Answer
verified

Correct Answer
verified

Total surplus in a market is consumer surplus minus producer surplus.

Correct Answer
verified

Figure 7-14 -Refer to Figure 7-14. At the equilibrium price, producer surplus is

Correct Answer
verified

Scenario 7-1 Suppose market demand is given by the equation -Refer to Scenario 7-1. If the market equilibrium price falls from $10 to $5, what is the change in total consumer surplus in the market?

Correct Answer
verified
Consumer s...
View Answer

If the cost of producing sofas decreases, then consumer surplus in the sofa market will

Correct Answer
verified

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

Moving production from a high-cost producer to a low-cost producer will

Correct AnswerverifiedShow Answer

Table 7-4 The numbers in Table 7-1 reveal the maximum willingness to pay for a ticket to a Chicago Cubs vs. St. Louis Cardinal's baseball game at Wrigley Field. -Refer to Table 7-4. If tickets sell for $25 each, then what is the total consumer surplus in the market?

Correct AnswerverifiedShow Answer

Figure 7-11 -Refer to Figure 7-11. If the supply curve is S, the demand curve is D, and the equilibrium price is $100, what is the producer surplus?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Figure 7-13 -Refer to Figure 7-13. If the equilibrium price rises from $60 to $120, what is the additional producer surplus to initial producers in the market?

Correct AnswerverifiedShow Answer

Total surplus in a market is equal to

Correct AnswerverifiedShow Answer

Producer surplus measures the

Correct AnswerverifiedShow Answer

Figure 7-19 -Refer to Figure 7-19. At the equilibrium price, total surplus is

Correct AnswerverifiedShow Answer

Total surplus is

Correct AnswerverifiedShow Answer

Figure 7-7 -Refer to Figure 7-7. What is the consumer surplus if the price is $100?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Suppose Lauren, Leslie and Lydia all purchase bulletin boards for their rooms for $15 each. Lauren's willingness to pay was $35, Leslie's willingness to pay was $25, and Lydia's willingness to pay was $30. Total consumer surplus for these three would be

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Which of the following statements is not correct?

Correct AnswerverifiedShow Answer

Figure 7-26 -Refer to Figure 7-26. If the government imposes a price floor of $90 in this market, then consumer surplus will be

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Total surplus in a market is consumer surplus minus producer surplus.

Correct AnswerverifiedShow Answer

Figure 7-14 -Refer to Figure 7-14. At the equilibrium price, producer surplus is

Correct AnswerverifiedShow Answer

Scenario 7-1 Suppose market demand is given by the equation -Refer to Scenario 7-1. If the market equilibrium price falls from $10 to $5, what is the change in total consumer surplus in the market?

Correct AnswerverifiedConsumer s...View AnswerShow Answer

If the cost of producing sofas decreases, then consumer surplus in the sofa market will

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Consumer s...
View Answer

Correct Answer
verified