Macroeconomics midterm

Monique buys a new television for $795. She receives consumer surplus of $355 from the purchase. How much does Monique value her television?

$1150

If the market price is $3.00, what is the consumer surplus on the first ice cream cone?

$.50

Paul goes to Dick's sporting goods to buy a new tennis racquet. He is willing to pay $200 for a new racquet, but buys one on sale for $125. Paul's consumer surplus from the purchase is

$75

If an increase in income leads to an increase in the demand for sushi, then sushi is

A Normal good

A supply curve

A curve that shows the relationship between the price of a product and the quantity of the product supplied.

________ means the supply curve has shifted to the right, while ________ refers to a movement along a given supply curve in response to an increase in price.

An increase in supply; an increase in quantity supplied

comparative advantage means the ability to produce a good or service

At a lower opportunity cost than any other producer

product efficiency is achieved when firms produce goods and services

At the lowest cost

refers to the reduction in economic surplus resulting from not being in competitive equilibrium

Deadweight loss

A(n) _____ is represented by a rightward shift of the demand curve while a(n) ______ is represented by a movement alone a given demand curve.

Increase in demand; increase in quantity demanded

perfectly competitive market, there are _____ buyers and ____ sellers.

Many;many

A____ demand curve for shampoo would be caused by a change in the price of shampoo

Movement along the

If a minimum wage of $10.50 is mandated there will be a

Surplus of 60,000 units of labor

oppurtunity cost

The highest-valued alternative that must be given up to engage in an activity.

The unattainable points in a production possibilities frontier are

The points outside the production possibilities frontier

The law of demand implies, holding everything else constant, that as the price of the bagel increases

The quantity of bagels demanded will decrease

Which of the following will not shift the demand curve for a good

an increase in the price of the good

Economists assume that individuals

are rational and respond to incentives

An outward shift of a nation's production possibilities frontier represents

economic growth

______ occurs when economic benefits are distributed fairly.

equity

In economics, the term ________ means "additional" or "extra."

marginal

Economic decline (negative growth) is represented on a production possibilities frontier model by the production possibility frontier

shifting inward

economic growth is represented on a production possibilities frontier model by the production possibilities frontier

shifting outward

allocative efficiency is achieved when firms produce goods and services

that consumers value most

The demand curve shows the relationship between:

the price of a product and the quantity of the product demanded.

If in the market for peaches the supply curve has shifted to the left,

the supply of peaches has decreased.

marginal analysis involves undertaking an activity

until its marginal benefits equal marginal costs.