Question 1

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

Accepted Answer

A) True 
 B)False

Question 2

Figure 7-1 
-Refer to Figure 7-1. If the price of the good is $200, then

Accepted Answer

A)   consumer surplus is $150.
B)   consumer surplus is $650.
C)   producer surplus is $650.
D)   producer surplus is $750.E) A) and D)
F) All of the above

Question 3

Table 7-11
The following table represents the costs of five possible sellers.
-Refer to Table 7-11. Suppose each of the five sellers can supply at most one unit of the good. The market quantity supplied is exactly 2 if the price is

Accepted Answer

A)   $1,700.
B)   $1,100.
C)   $1,650.
D)   $1,050.E) A) and B)
F) A) and C)

Question 4

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

Accepted Answer

A)   $40.
B)   $50.
C)   $60.
D)   $70.E) None of the above
F) B) and C)

Question 5

Figure 7-31 
-Refer to Figure 7-31. If the market equilibrium price rises from $25 to $35, how much is the increase in producer surplus to the producers supplying units at the initial $25 price?

Accepted Answer

The increase in prod...

Question 6

Refer to Figure 7-9. If producer surplus is $19, then the price of the good is

Accepted Answer

A)   $11.50.
B)   $14.50.
C)   $13.50.
D)   $9.75.E) A) and B)
F) None of the above

Question 7

Figure 7-15 
-Refer to Figure 7-15. Area B represents

Accepted Answer

A)   the combined profits of all producers when the price is P2.
B)   the increase in producer surplus to all producers as the result of an increase in the price from P1 to P2.
C)   producer surplus to new producers entering the market as the result of an increase in the price from P1 to P2.
D)   that portion of the increase in producer surplus that is offset by a loss in consumer surplus when the price increases from P1 to P2.E) None of the above
F) C) and D)

Question 8

Donald produces nails at a cost of $200 per ton. If he sells the nails for $350 per ton, his producer surplus per ton is

Accepted Answer

A)   $150.
B)   $200.
C)   $350.
D)   $550.E) B) and D)
F) A) and B)

Question 9

At the equilibrium price of a good, the good will be purchased by those buyers who

Accepted Answer

A)   value the good more than price.
B)   value the good less than price.
C)   have the money to buy the good.
D)   consider the good a necessity.E) A) and D)
F) A) and C)

Question 10

Figure 7-3 
-Refer to Figure 7-3. Area C represents the

Accepted Answer

A)   decrease in consumer surplus that results from a downward-sloping demand curve.
B)   consumer surplus to new consumers who enter the market when the price falls from P2 to P1.
C)   increase in producer surplus when quantity sold increases from Q2 to Q1.
D)   decrease in consumer surplus to each consumer in the market when the price increases from P1 to P2.E) B) and D)
F) C) and D)

Question 11

Table 7-17
 
-Refer to Table 7-17. At a price of $2.00, total surplus is

Accepted Answer

A)   larger than it would be at the equilibrium price.
B)   smaller than it would be at the equilibrium price.
C)   the same as it would be at the equilibrium price.
D)   There is insufficient information to make this determination.E) B) and D)
F) B) and C)

Question 12

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

Accepted Answer

A)   $600.
B)   $1,200.
C)   $1,500.
D)   $1,800.E) B) and C)
F) C) and D)

Question 13

When the supply of a good decreases and the demand for the good remains unchanged, consumer surplus

Accepted Answer

A)   decreases.
B)   is unchanged.
C)   increases.
D)   may increase, decrease, or remain unchanged.E) B) and C)
F) A) and D)

Question 14

Let P represent price; let QS represent quantity supplied; and assume the equation of the supply curve is
  If 80 units of the good are produced and sold, then producer surplus amounts to $1,200.

Accepted Answer

A) True 
 B)False

Question 15

Donald produces nails at a cost of $350 per ton. If he sells the nails for $500 per ton, his producer surplus is

Accepted Answer

A)   $150.
B)   $350.
C)   $500.
D)   $850.E) B) and C)
F) All of the above

Question 16

Figure 7-5 
-Refer to Figure 7-5. If the price of the good is $12, then consumer surplus is

Accepted Answer

A)   $9.
B)   $11.
C)   $13.
D)   $16.E) B) and C)
F) A) and B)

Question 17

According to many economists, government restrictions on ticket scalping do all of the following except

Accepted Answer

A)   inconvenience the public.
B)   reduce the audience for cultural and sports events.
C)   waste police officers' time.
D)   keep the cost of tickets to all consumers low.E) B) and D)
F) B) and C)

Question 18

Jeff decides that he would pay as much as $2,000 for a new laptop computer. He buys the computer and realizes a consumer surplus of $300. How much did Jeff pay for his computer?

Accepted Answer

A)   $300.
B)   $1,700.
C)   $2,000.
D)   $2,300.E) C) and D)
F) A) and B)

Question 19

Michael values a stainless steel refrigerator for his new house at $3,500, but he succeeds in buying one for $3,000. Michael's consumer surplus is

Accepted Answer

A)   $500.
B)   $3,000.
C)   $3,500.
D)   $6,500.E) None of the above
F) A) and B)

Question 20

Table 7-10
The only four consumers in a market have the following willingness to pay for a good:
Buyer Willingness to Pay
 
-Refer to Table 7-10. If there is only one unit of the good available for purchase, and if the buyers bid against each other for the right to purchase it, then the consumer surplus will be

Accepted Answer

A)   $0 or slightly more.
B)   $3 or slightly less.
C)   $4 or slightly more.
D)   $8 or slightly less.E) A) and B)
F) A) and C)

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

Jeff decides that he would pay as much as $2,000 for a new laptop computer. He buys the computer and realizes a consumer surplus of $300. How much did Jeff pay for his computer?

Correct Answer
verified

Donald produces nails at a cost of $350 per ton. If he sells the nails for $500 per ton, his producer surplus is

Correct Answer
verified

According to many economists, government restrictions on ticket scalping do all of the following except

Correct Answer
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Figure 7-26 -Refer to Figure 7-26. At the equilibrium price, total surplus is

Correct Answer
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Let P represent price; let QS represent quantity supplied; and assume the equation of the supply curve is If 80 units of the good are produced and sold, then producer surplus amounts to $1,200.

Correct Answer
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Table 7-11 The following table represents the costs of five possible sellers. -Refer to Table 7-11. Suppose each of the five sellers can supply at most one unit of the good. The market quantity supplied is exactly 2 if the price is

Correct Answer
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Table 7-17 -Refer to Table 7-17. At a price of $2.00, total surplus is

Correct Answer
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Figure 7-3 -Refer to Figure 7-3. Area C represents the

Correct Answer
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Figure 7-15 -Refer to Figure 7-15. Area B represents

Correct Answer
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When the supply of a good decreases and the demand for the good remains unchanged, consumer surplus

Correct Answer
verified

Donald produces nails at a cost of $200 per ton. If he sells the nails for $350 per ton, his producer surplus per ton is

Correct Answer
verified

Michael values a stainless steel refrigerator for his new house at $3,500, but he succeeds in buying one for $3,000. Michael's consumer surplus is

Correct Answer
verified

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

Correct Answer
verified

Figure 7-1 -Refer to Figure 7-1. If the price of the good is $200, then

Correct Answer
verified

Figure 7-5 -Refer to Figure 7-5. If the price of the good is $12, then consumer surplus is

Correct Answer
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At the equilibrium price of a good, the good will be purchased by those buyers who

Correct Answer
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Figure 7-31 -Refer to Figure 7-31. If the market equilibrium price rises from $25 to $35, how much is the increase in producer surplus to the producers supplying units at the initial $25 price?

Correct Answer
verified
The increase in prod...
View Answer

Refer to Figure 7-9. If producer surplus is $19, then the price of the good is

Correct Answer
verified

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

Correct Answer
verified

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

Jeff decides that he would pay as much as $2,000 for a new laptop computer. He buys the computer and realizes a consumer surplus of $300. How much did Jeff pay for his computer?

Correct AnswerverifiedShow Answer

Donald produces nails at a cost of $350 per ton. If he sells the nails for $500 per ton, his producer surplus is

Correct AnswerverifiedShow Answer

According to many economists, government restrictions on ticket scalping do all of the following except

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Let P represent price; let QS represent quantity supplied; and assume the equation of the supply curve is If 80 units of the good are produced and sold, then producer surplus amounts to $1,200.

Correct AnswerverifiedShow Answer

Table 7-11 The following table represents the costs of five possible sellers. -Refer to Table 7-11. Suppose each of the five sellers can supply at most one unit of the good. The market quantity supplied is exactly 2 if the price is

Correct AnswerverifiedShow Answer

Table 7-17 -Refer to Table 7-17. At a price of $2.00, total surplus is

Correct AnswerverifiedShow Answer

Figure 7-3 -Refer to Figure 7-3. Area C represents the

Correct AnswerverifiedShow Answer

Figure 7-15 -Refer to Figure 7-15. Area B represents

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

When the supply of a good decreases and the demand for the good remains unchanged, consumer surplus

Correct AnswerverifiedShow Answer

Donald produces nails at a cost of $200 per ton. If he sells the nails for $350 per ton, his producer surplus per ton is

Correct AnswerverifiedShow Answer

Michael values a stainless steel refrigerator for his new house at $3,500, but he succeeds in buying one for $3,000. Michael's consumer surplus is

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Figure 7-1 -Refer to Figure 7-1. If the price of the good is $200, then

Correct AnswerverifiedShow Answer

Figure 7-5 -Refer to Figure 7-5. If the price of the good is $12, then consumer surplus is

Correct AnswerverifiedShow Answer

At the equilibrium price of a good, the good will be purchased by those buyers who

Correct AnswerverifiedShow Answer

Figure 7-31 -Refer to Figure 7-31. If the market equilibrium price rises from $25 to $35, how much is the increase in producer surplus to the producers supplying units at the initial $25 price?

Correct AnswerverifiedThe increase in prod...View AnswerShow Answer

Refer to Figure 7-9. If producer surplus is $19, then the price of the good is

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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The increase in prod...
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