Econ Exam 2

Refer to Figure 6-10. The amount of the tax per unit is

$14

Refer to Table 7-11. The equilibrium price is

$4.00

Okino's Bean Bag Emporium produced 300 bean bag chairs but sold only 255 of the units it produced. The average cost of production for each unit of output produced was $100. The price for each of the 255 units sold was $95. Total profit for Okino's Bean Bag Emporium would be

-$1,275.

Refer to Table 14-7. What is the value of B?

100

Suppose a certain firm is able to produce 200 units of output per day when 18 workers are hired. The firm is able to produce 219 units of output per day when 19 workers are hired, holding other inputs fixed. The marginal product of the 19th worker is

19 units of output

Let L represent the number of workers hired by a firm, and let Q represent that firm's quantity of output. Assume two points on the firm's production function are (L = 12, Q = 122) and (L = 13, Q = 130). Then the marginal product of the 13th worker is

8 units of output.

Refer to Figure 7-1. When the price is P1, consumer surplus is

A+B+C

For any competitive market, the supply curve is closely related to the

B

Which tools allow economists to determine if the allocation of resources determined by free markets is desirable?

Consumer and producer surplus

Refer to Table 14-12. Which firm has economies of scale and then diseconomies of scale as output increases from 1 to 7?

Firm 4

Refer to Figure 7-9. The price the buyer pays with the tax equals

P3

Refer to Table 14-5. The Wooden Chair Factory experiences diminishing marginal product of labor with the addition of which worker?

The sixth worker

When marginal cost is less than average total cost,

average total cost is falling

A tax affects

buyers, sellers, and the government.

The decrease in total surplus that results from a market distortion, such as a tax, is called a

deadweight loss.

Refer to Figure 15-1. If the market price is $24, the firm will earn

negative economic profits in the short run but remain in business

Refer to Figure 15-3. In the short run, if the market price is higher than P4 but less than P6, individual firms in a competitive industry will earn

positive profits

Cost is a measure of the

seller's willingness to sell

Efficiency in a market is achieved when

the sum of producer surplus and consumer surplus is maximized.

A seller's opportunity cost measures the

value of everything she must give up to produce a good.