Econ Exam 2

(Refer to table 4-1) Kendra's marginal benefit from consuming the second ice cream cone

3.00

(Refer to table 4-1) Kendra's marginal benefit from consuming the first ice cream cone

3.50 dollars

a technological advancement would be represented by a movement from

S1 to S2

Monique buys a new television of 795. She receives consumer surplus of 355 dollars from the purchase. How much was her Television?

1150 dollars

Kendra's marginal benefit from consuming the third ice cream cone is

2.30

(Refer to table 4-1) The table above lists the highest prices of three customers curly moe and larry are willing to pay for a bottle of champagne. if the price of one of the bottles is 27 dollars, total consumer surplus will be

26 dollars

Juanita goes to the Hardware Emporium to buy a new circular saw. She is willing to pay $120 for a new saw, but buys one on sale for $85. Juanita's consumer surplus from the purchase is

35 dollars

(Refers to table 4-4) If minimum wage of 9.50 an hour is mandated, what is the quantity of labor demanded?

360,000

Refer to figure 3-4. At a price of 25 dollars how many units will be sold?

500

Brett buys a new cell phone for $100. He receives a consumer surplus of $80 from the purchase. How much does Brett value his cell phone?

60 dollars

Marco goes to the pet store to buy a dozen koi fish for his new koi pond. he is willing to pay 200 dollars for the dozen fish buy buys them for 140 dollars. Marco's consumer surplus from the purchase is

60 dollars

refers to 3-4. At a price of 20 dollars how many units will be sold ?

600

(Refers to figure 4-3)What area represents consumer surplus at P2

A

When ________ in a market, the total net benefit to society is maximized.

A competitive equilibrium is achieved

(Refers to figure 4-2) What area represents the decrease in producer surplus when the market price falls from P2 to P1

A+B

(Refers to figure 4-5) What is the area that reprensts consumer surplus after the imposition of the ceiling

A+B+D

(Refers to figure 4-3)What area represents a producer suplus at P2

B+D

(Refers to figure 4-2)what area represents producer surplus at a price of P1

C

(Refer to table 4-1) The table above lists the highest prices of three customers, curly, moe, and larry are willing to pay for a bottle of champagne. if the price of one of the bottles is 24 dollars

Curly will recieve 26 dollars of consumer surplsus from buying one bottle

A decrease in the number of firms in a market will cause supply to increase

False

A positive technological change will cause the quantity of a good supplied to increase

False

All else equal, as the price of a product falls, the quantity supplied decreases

False

An increase in quantity supplied is represented by a rightward shift of the supply curve

False

An inferior good is a good whose quantity demanded increases as the price decreases , holding everything else constant

False

If consumers believe that the price of computer and tablet computers will increase in the future, this will cause the demand for tablet computers to decrease now

False

If the price of a product is expected to increase in the future, the supply today will increase

False

If the price of peaches, a substitute for plums, increases the demand for plums will decrease.

False

Peanut butter and jelly are complements. If the price of peanut butter increases, the demand for jelly will increase

False

a decrease in supply is caused by a decrease in the price of the product

False

the income effect explains why there is usually a direct relationship between the price of product and the quantity of the product demanded

False

The table above shows the demand schedules for Kona coffee of two individuals (Luke and Ravi) and the rest of the market. If the price of kona Coffee falls from 6 dollars to 4 dollars the market quantity demanded would

Increase by 61 lbs

suppose that when the price of oranges decreases, sanrita decreases her purchases of peaches. To sanrita -

Oranges and Peaches are substitutes

assume that the graph in this figure represent the demand and supply curves for laptop computers. which panel best describes what happens in this market when the price of computer hard drives falls?

Panel A

assume that the graphs in this figure represent the demand and supply curves for blu-ray discs. Which pannel best describes what happens in this market if there is a substantial increase in the price of blu-ray players?

Panel D

(Refers to figure 4-5) With rent control, the quantity supplied is Q1. Suppose apartment owners ignore the law and rent this quantity for the highest rent they can get. What is the highest rent they can get?

R1

a decrease in the price of inputs would be represented by a movement from

S1 to S2

an increase in the expected future price of the product would be represented by a movement from

S2 to S1

if the united states lifts the emargo on cuban products, what will happen in the us market for cuban cigars

The supply curve will shift to the the right

A decrease in the price of inputs will cause the supply curve for a product to shift to the right

True

An increase in population results in an increase in demand

True

The substitution effect explains why there is an inverse relationship between the price of a product and the quantity of the product demanded

True

a change in quantity supplied is represented by a movement along the supply curve

True

a normal good is a good for which the demanded decreases as income decreases, holding everything else constant

True

(Refers to table 4-4) what is the equilibrium hourly wage and the equilibrium quantity of labor

W=9.00; Labor=370,000

which of the following would shift the supply curve for energy drinks to the left?

a decrease in the number of firms that produce energy drinks

Which of the following would shift the supply curve for smartphones to the right?

a decrease in the price of an input used to produce smartphones

hurricane katrina damaged a large portion of the refining and pipline capacity when it swept through the gulf coast states in august 2005. As a result of this many gasoline distributors were not able to produce normal deliveries. At the pre-hurricane quilibrium price we would expect to see

a shortage of gasoline

electric car enthusiasts want to buy more electric cars at a lower price. All of the following events would have this effect except-

an increase in the price of gasoline

Indicate if this would whether each of the following situations would shift the supply curve to the left, to the right, or not at all e.a decrease in the current price of the product

no shift at all

which of the following would cause a decrease in the supply of peanut butter?

an increase on the price of peanuts

If a decrease in income leads to an increase in the demand for macaroni is

an inferior good

at a products equilibrium price

any buyer who is willing and able to pay the price will find a seller for the product.

In Venezuela, the government attempted to control rising food prices by implementing price ceilings in the market. These prices were set _____ the market prices, which resulted in _____ of food

below;shortages

The table above shows the demand schedules for Kona coffee of the two individuals (Luke and Ravi) and the rest of the market. If the price of Kona coffee rises from 4 dollars to five, the market quantity demanded would-

decrease by 35 Lbs

what would happen in the market for knee replacement surgery if insurance companies started to consider a smaller portion of the cost of the surgery

demand will decrease, but this will not shift the supply curve

_____ is defined as a market outcome in which the marginal benefit to consumers of the last unit produced is equal to the marginal cost of production and in which the sum of consumer surplus and producer surplus is at a maximum

economic efficiency

suppose that when the price of hamburgers increase, the ruiz family increases their purchases of hot dogs. To the ruiz family-

hamburgers and hot dogs are substitutes

The difference between the _____ for a good and the ____ is called consumer surplus

highest price a customer is willing to pay; price the consumer actually pays

Indicate if this would whether each of the following situations would shift the supply curve to the left, to the right, or not at all a. an increase in the price of an input

left

Indicate if this would whether each of the following situations would shift the supply curve to the left, to the right, or not at all c. an increase in the price of a substitute in production

left

Economic surplus is maximized in competitive market when

marginal benefit equals marginal cost

The additional cost to a firm of producing one more unit of a good or service is the

marginal cost

(Refer to table 4-3) The table above lists the marginal cost of polo shirts by Marko's a firm that specializes in selling men's clothing. If the market price of marko's polo shirt is 18 dollars

producer surplus will equal 22 dollars

At market equilibrium-

quantity demanded = quantity supplied

Indicate if this would whether each of the following situations would shift the supply curve to the left, to the right, or not at all b. an increase in productivity

right

Indicate if this would whether each of the following situations would shift the supply curve to the left, to the right, or not at all d.a decrease in the expected future price of a product

right

when the price of a good rises, consumers buy a smaller quantity because of the ____ effect and the _____ effect

substitution; income

factory incentives on cell phones have encouraged consumers to upgrade their phones. How does this affect the market for Bluetooth headsets?

the demand for Bluetooth hradsets increases

assume the price for lawn care has fallen and sales of lawn care services have also fallen. One can conclude that-

the demand for lawn care services has increased

refers to 3-4. If the price is 20 dollars-

the market is in equilibrium

By drawing a demand curve with the price on the vertical axis and quantity on the horizontal axis, economists assume that the most important determinant of the demand for a good is the

the price of the good

which of the following is evidence of a shortage of chocolate?

the quantity of chocolate demanded is greater than the quantity supplied

which of the following describes a characteristic of a perfectly competitive market?

there are many buyers and sellers

refers to figure 3-5. At a price of 5 dollars

there is a shortage of 4 units

refers to figure 3-5. At a price of 0 dollars

there is a shortage of 8 units

Refer to figure 3-4. If the price is 25 dollars

there is a surplus of 300 units

The maximum price that a buyer is willing to pay for good measures his

willingness to pay