supply/demand and economic welfare

Which type of payment would NOT be a market transaction?

payment made to a victim of a natural disaster

Consumer surplus is defined as the difference between ____ and the market price

the demand curve

(Figure: Interpreting a Market Graph) The graph represents

the law of supply

Producer surplus is defined as the difference between

the market price and the supply curve

(Figure: Understanding Surplus and Efficiency) In the graph, efficiency in this market is achieved at a price of

$10

Suppose a customer's willingness-to-pay for a product is $79, and the seller's willingness-to-sell is $64. If the negotiated price is $68, how much is producer surplus?

$4

Suppose the demand for gasoline is rising. Which statement describes a possible cause?

Consumers expect prices to rise in the near future

(Figure: Predicting Demand Shifts 2) What would cause a shift from D1 to D2?

a new study that shows that honey reduces the risk of cancer

(Figure: Determining Surplus and Loss) Consider the graph. If the price is raised from $8 to $12, producer surplus

increases by $50 and deadweight loss increases by $70

(Table) According to the table, the equilibrium price is

$10, $6

(Figure: Interpreting Supply Shifts 3) When the supply shifts from S0 to S1, the equilibrium quantity changes from

20 units to 15 units

At any price below the equilibrium price:

the quantity demanded exceeds the quantity supplied in the market.

Jonathan purchased coffee for $5 at Jennifer's coffee shop; however, he was willing to pay $9. Jennifer was willing to accept $3 for the coffee. The results of this transaction are a consumer surplus of:

$4 and a producer surplus of $2

(Figure: Determining Surplus and Loss) In the graph, how much is the deadweight loss at a price of $12?

$70

(Figure: Individual and Market Demand Curves) According to the graph, the market quantity demanded at $20 is

10 units

Which item is most likely an inferior good?

a city bus ticket

(Figure: Interpreting Demand Curve) In the demand curve shown, an increase in price from $1 to $2 will

cause quantity demanded to fall from 30 to 20 units

Suppose that a customer's willingness to pay for a product is $79, and the seller's willingness to sell is $64. If the negotiated price is $65

consumer surplus is greater than producer surplus

(Figure: Supply and Demand for Shoes) If the price of shoes is $60, then the market

experiences a surplus of shoes

Which of these circumstances would NOT affect the supply of new automobiles?

higher interest rates for new car financing

(Figure: Interpreting Supply Shifts 2) A shift to the right of the supply curve could be caused be an

improvement in production technology

When quantity demanded in a market equals quantity supplied, then the

market is in equilibrium

Supply is defined as ____ over a particular time period at various prices, holding all other relevant factors constant

maximum amount of a product that sellers are willing and able to provide for sale

Other factors held constant, as the price of an iPad rises, the

quantity demanded of iPads falls

The measure of society's benefits due to a market transaction is called:

total surplus