ECO 201 Final Exam pt 3

Q 3 − Q 0 .

(Figure: Supply and Demand in the Market for Fresh Produce) Use Figure: Supply and Demand in the Market for Fresh Produce. If a price floor is set at P 4 to help improve farm incomes, and the government wants to assure farmers that their output will be purchased, the government must purchase an amount of output equal to:

$20,000

(Figure: Market for Logs) A quota of 10,000 logs forest wood per month is placed in the market that is shown in the figure. How much are buyers willing to pay after the implementation of the quota?

be too many; unemployment

Economic theory implies that if a minimum wage is set above the equilibrium wage, there will _____ workers, and _____ will result.

more people supplying their labor to a labor market.

Higher wages lead to

A,C

In the graph below, P2 is a price ceiling. Select all letters corresponding to areas on the graph that are part of the consumer surplus after the price ceiling is imposed.

the size and composition of a family

The official poverty line depends on _____ and is adjusted every year to reflect changes in the cost of living.

poverty line.

An income level below which a family is defined to be in poverty is known as the:

producer surplus in the market for lumber will increase.

If a country has the comparative advantage in producing lumber, then with free trade:

an incentive.

The price of firewood rises, which encourages Marcella to buy less firewood. Price is functioning as

below

To be binding, a price ceiling must be set at a price _____ the equilibrium price.

decrease; decrease

(Figure: Competitive Equilibrium in the Labor Market) Use Figure: Competitive Equilibrium in the Labor Market. In the figure, a decrease in the productivity of labor will, all else equal, lead to a(n) _____ in the equilibrium quantity of labor and a(n) _____ in the equilibrium price of labor.

500; 0

(Figure: Market for Engines) According to the figure, if there is international trade in this market, and the world price of an engine is $800, domestic consumers will purchase _____ units from domestic producers and _____ units from foreign producers.

d; shortage; i and h

(Figure: Price Control in the Market for Gasoline) Use Figure: Price Control in the Market for Gasoline. Dramatic increases in the price of gasoline have led the government to impose a price ceiling. One effective price ceiling would be the price indicated at point _____, creating a _____ equal to the difference between points _____.

$1,200 for 1.8 million units.

(Figure: Rent Controls in the Market for Apartments in New York City) Use Figure: Rent Controls in the Market for Apartments in New York City. If a rent ceiling were set at $800, renters would be willing to pay a price at least as high as:

floor; $180

(Figure: The Market for Accounting Textbooks) Use Figure: The Market for Accounting Textbooks. Suppose the government believes the producers of accounting textbooks are not profitable, and it wants to make sure textbook producers are profitable. It could impose a control called a price _____, and for it to be binding, one possible price would be _____.

export 150,000 Apple AirPods.

(Figure: The Market for Apple AirPods) Use Figure: The Market for Apple AirPods. Assume that S d represents the domestic supply curve and that D d represents the domestic demand curve. If the world price equals $120, and there is free trade, this country will:

Y.

(Figure: The Market for Apple Computers in the United States) Use Figure: The Market for Apple Computers in the United States. Assume that P A is the domestic equilibrium price without trade and P W is the world price. Producer surplus without international trade would be area:

rises; G + H + I + J + K

(Figure: The Market for Tea in India) Use Figure: The Market for Tea in India. Without trade, the price is P A . When the economy is opened to trade, the price rises to P W , and producer surplus _____ to _____.

I.

(Figure: The Market for Tea in India) Use Figure: The Market for Tea in India. Without trade, the price is P A . When the economy is opened to trade, the price rises to P W , and the change in total surplus is:

Jason because he has a lower opportunity cost than Marla.

(Table: Cooking time) The table provides data on how long it takes Marla and Jason to cook lasagna and cook chicken curry. Which statement explains who has a comparative advantage in cooking chicken curry?

4

(Table: Employment and Output in the Buckwheat Market) Use Table: Employment and Output in the Buckwheat Market. In the table, if the price of a bushel of buckwheat is $10, and the price of labor (the wage) is $120, then the profit-maximizing quantity of labor is: ​

.4 of the windows washed; .5 of the windows washed

(Table: Joachim and Zane's opportunity cost) The table provides data on how long it takes Joachim and Zane to clean the bathrooms and wash the windows at a home. Joachim's opportunity cost for cleaning bathrooms is _____, and Zane's opportunity cost for cleaning bathrooms is _____.

export; import

A Korean-made washing machine purchased by a Chinese citizen is an example of a Korean _____, and a Chinese-made washing machine purchased by a Korean citizen is an example of a Korean _____.

The market price will fall.

A binding price floor in a market is removed. Which of the following is likely to occur as a result?

as a person's income rises, a higher tax rate is paid on the extra dollars that are earned.

A progressive tax system is designed so that:

hire the additional pastry chef.

Amanda owns a small bakery in the perfectly competitive pastry industry. She is considering whether to hire an additional pastry chef. The wage rate for pastry chefs is $1,000 per week, the marginal product of an additional pastry chef is 1,000 pastries per week, and the unit price of pastries is $1.25. Amanda should:

rise; fall

If a country imposes a tariff on imported designer boots, the domestic price of designer boots will likely _____, and the quantity of designer boots purchased in the domestic market will likely _____.

Gregory; cookies

If they bake only muffins, in a single day, Gregory can bake 10 muffins, and Gabriella can bake five muffins. If they bake only cookies, in a single day, Gregory can bake 10 cookies, and Gabriella can bake four cookies. We know that _____ has an absolute advantage and a comparative advantage in baking _____.

Zane, Zane

The table shows data on how long it takes Joachim and Zane to clean the bathrooms and wash the windows at a home. _______ has the absolute advantage in cleaning bathrooms, and __________ has the absolute advantage in washing windows.

falls; rises; gains

When an economy moves from a scenario without trade to free international trade, for industries in the export sector, consumer surplus _____, producer surplus _____, and the economy as a whole _____.

a means-tested

When eligibility for a government program is based on income and sometimes on wealth, the program is classified as _____ program.

Martin receives housing from the government due to his low income.

Which of the following is an example of an in-kind transfer?

25%

Which of the following tax systems is progressive? Corinne pays a 10% tax on the first $10,000 she earns plus _____ tax on any additional income.

at a lower opportunity cost than anyone else.

You have a comparative advantage if you can complete a task: