econ final sara seals

Originally, each producer divided his time equally between the production of novels and the production of poems. Now, each producer spends all his time producing the good in which he has a comparative advantage. As a result, the total output of novels increased by

1 novel.

Refer to Figure 7-29. Which of the following statements is correct?

At Q4, the value to buyers is less than the cost to sellers.

For which of the following individuals would the opportunity cost of going to college be highest?

a famous, highly-paid actor who wants to take time away from show business to finish college and earn a degree

Use the above figure to answer the following question. In this market, a minimum wage of $7.25 is

binding and creates unemployment (a labor surplus or a shortage of jobs).

Refer to Figure 15-2. If the firm's average total cost curve is ATC1, the firm will

make a profit.

Use the table below to answer the following question: Price. Qd. Qs $20. 50. 20 22. 45. 25 24. 40. 30 26. 35. 35 28. 30. 40 If the price in the market were $24, there would be a

shortage of 10 units.

Refer to Figure 6-1. The price ceiling shown in panel (a)

is not binding.

Refer to Figure 12-10. The total cost at the profit-maximizing output level equals

$3,300

What is the fixed cost per bowl (AFC) when 2 workers are hired?

$0.29 per bowl

Refer to Figure 7-22. At the equilibrium price, consumer surplus is

$1,000

Use the above graph to answer the following question. The vertical distance between points A and B represents a tax in the market. What is the size of the tax?

$10

Refer to Table 12-1. What is the fixed cost of production?

$1000

Table: Jersey Shore Buyer Willingness to Pay Pauly. $150.00 Vinnie. $135.00 Ronnie. $120.00 Mike. $100.00 Use the above table to answer the following question. If the market price is $99, total consumer surplus in the market is

$109

The table represents a demand curve faced by a restaurant in a competitive market. For this firm, the price is

$13

If the market price is $10, what is the competitive firm's profit?

$15

Use the above graph to answer the following question. The vertical distance between points A and B represents a tax in the market. What will be the deadweight loss due to the tax?

$1500

Use the above figure to answer the following question. A tax of $4 would decrease the price the sellers receive by

$2

Suppose that for a particular firm the only variable input into the production process is labor and that output equals zero when no workers are hired. In addition, suppose that when the firm hires 4 workers, the firm produces 50 units of output. If the fixed cost of production is $4, the variable cost per unit of labor is $20, and the marginal product of labor for the fifth unit of labor is 2, what is the average total cost of production when the firm hires 5 workers?

$2.00

What is the socially efficient price and quantity combination?

$22, 83 units

Use the above graph to answer the following question. Suppose the government imposes a tax of $3 per unit. What is producer surplus with the tax?

$22.50

What price/quantity combination will the monopolist use to maximize profit?

$24, 62 units

Use the above graph to answer the following question. The vertical distance between points A and B represents a tax in the market. How much tax revenue will the government collect?

$3000

Lucinda buys a new motorcycle helmet for $250. She receives consumer surplus of $75 from the purchase. What value does Lucinda place on her motorcycle helmet?

$325

Ziva is an organic lettuce farmer, but she also spends part of her day as a professional organizing consultant. As a consultant, Ziva helps people organize their houses. Due to the popularity of her home-organization services, Farmer Ziva has more clients requesting her services than she has time to help if she maintains her farming business. Farmer Ziva charges $25 an hour for her home-organization services. One spring day, Ziva spends 10 hours in her fields planting $130 worth of seeds on her farm. She expects that the seeds she planted will yield $300 worth of lettuce. An economist would calculate Ziva's total cost of farming to equal

$380

Use the above graph to answer the following question. The vertical distance between points A and B represents a tax in the market. What is total surplus in this market when the tax is imposed?

$4500

What is the deadweight loss due to the monopolist's price/quantity combination?

$500

Each worker at Casa Bonita costs $12 per hour. The cost of each oven is $20 per day regardless of the number of tacos produced. What is the total daily cost of producing at a rate of 55 tacos per hour if the restaurant operates 8 hours per day?

$520

Refer to Figure 7-22. The efficient price is

$70, and the efficient quantity is 100.

When a certain competitive firm produces and sells 100 units of output, marginal revenue is $80. When the same firm produces and sells 200 units of output, what is average revenue?

$80

Refer to Figure 2-6. If the economy is currently producing at point D, what is the opportunity cost of moving to point A?

0 spoons

Table 2-8 shows the output per month of two people, Ellie and Delilah. They can either devote their time to making marble statues or making marble benches.Refer to Table 2-8. What is Delilah's opportunity cost of making a statue?

1/2 of a bench

If Jordan spends all of his resources and technology producing poems, what is the maximum amount of poems he can produce?

12 poems

Assume that Mexico and the United States each has 2400 hours available. Originally, each country divided its time equally between the production of limos and jets. Now, each country spends all its time producing the good in which it has a comparative advantage. As a result, the total output of limos increased by

16

Table 2-4 shows the output per day of two gardeners, Gabe and Lucy. They can either devote their time to mowing lawns or cultivating gardens. What is Lucy's opportunity cost of mowing a lawn?

2/3 of a cultivated garden

Use the supply schedule below to answer the following question: Price. Quantity Supplied $10 100. $20. Q1 If the law of supply applies to this good, then Q1 could be

200

What is total output when 5 workers are hired?

225 units

If the firm can sell its output for $1 per unit, what is the profit-maximizing level of output?

230 units

Refer to Figure 2-6. If the economy is currently producing at point B, what is the opportunity cost of moving to point C?

26 thousand forks

Studies indicate that the price elasticity of demand for cigarettes is about 0.4. A government policy aimed at reducing smoking changed the price of a pack of cigarettes from $2 to $6. According to the midpoint method, the government policy should have reduced smoking by

40%

Assume that Jordan and Christian each has 180 minutes available. If each producer divides his time equally between the production of stuffed animals and pinatas, then the total combined production between the two producers is

48 stuffed animals and 24 pinatas

Use the above graph to answer the following question. If this economy uses all of it's resources to produce quesadillas, what's the maximum amount of quesadillas it can possibly produce?

70 quesadillas

Use the above graph to answer the following question. Suppose the government imposes at tax of P3-P1. What is the consumer surplus with the tax?

A

Refer to Figure: Clorox Wipes. A decrease in the price of Clorox wipes would cause a movement from

A to B.

Suppose Nicole can record two makeup tutorials per hour or she can record four dance tutorials per hour. Angela can record one makeup tutorial per hour or she can record three dance tutorials per hour. Which of the following is true? A. Nicole has the absolute advantage in makeup tutorials. B. Nicole has the comparative advantage over Angela in makeup tutorials. C. Angela has the comparative advantage over Nicole in dance tutorials.

A, B, and C are all correct.

In the long run, the firm can operate on which of the following average total cost curves?

ATCA ATCB ATCC All of the above are correct.

Minutes Needed to Make 1 Stuffed Animal Pinata Jordan 3 10 Christian 5 6 Who has the absolute advantage in the production of pinatas?

Christian

Use the graph below to answer the following question. As the price falls from Pa to Pb, which demand curve represents the most elastic demand

D1

Refer to Figure: Clorox Wipes. An decrease in the price of a substitute (Lysol wipes) would be represented by a movement from

D2 to D1

Table 2-4 shows the output per day of two gardeners, Gabe and Lucy. They can either devote their time to mowing lawns or cultivating gardens.Refer to Table 2-4. Which of the following statements is true?

Lucy has a comparative advantage in garden cultivating and Gabe in lawn mowing.

Figure 2-9 shows the production possibilities frontiers for Greenland and Iceland. Each country produces two goods, snow cones and popsicles.Refer to Figure 2-9. Which country has a comparative advantage in the production of snow cones?

Iceland

Figure: Coffee Market shows the demand and supply curves for the coffee market. The government believes that the equilibrium price is too low and tries to help almond growers by setting a price floor at $7.00. Refer to Figure: Coffee Market. What does consumer surplus in this market decrease by when the price floor of $7 is imposed?

None of the above

What is the monopolist's profit?

None of the above.

Refer to Figure 2-1. ___________ is (are) considered inefficient given the current resources.

Only point A

Refer to Table 15-1. What is the firm's profit-maximizing output and what is the price charged to sell this output?

P = $70; Q = 13

Refer to Figure 3-7. Assume that the graphs in this figure represent the demand and supply curves for limo rides and that limo rides and helicopter rides are substitutes. What panel describes what happens in this market when the price of helicopter rides rises?

Panel (c)

Suppose the state of Illinois passes a law that bans smoking in restaurants. As a result, residents of Wisconsin who do not like breathing second-hand smoke begin driving across the border to Illinois to eat at restaurants there. Which of the following principles does this best illustrate?

People respond to incentives

Due to a fear of increases in produce prices, and the fear of contracting COVID-19 with a trip to the grocery store, many families started gardens this past spring. Starting a garden requires the purchase of seeds (for example: tomato seeds). As a result of this change in consumer's expectations/tastes, what happened to producer surplus in the market for tomato seeds? (Hint: draw a supply and demand diagram to help you).

Producer surplus increased

Suppose a binding price floor on sparkling wine is proposed by the Health Minister of the country of Vinyardia. What will be the likely effect on the market for sparkling wine in Vinyardia?

Quantity demanded will decrease, quantity supplied will increase, and a surplus will result.

Refer to Figure: Clorox Wipes. Acquiring new machinery that could produce Clorox wipes more quickly (i.e. an advance in technology) would be represented by a movement from

S1 to S2

Refer to Figure 4-7 which shows the market for vitamins. Suppose the government imposes a price ceiling of Pv. Which of the following is true regarding how this price ceiling will affect the quantity supplied, quantity demanded, and quantity exchanged?

This price ceiling will have no effect on the market outcome, because it will not be binding.

Using the figure above: which of the following statements is not correct?

Supply curve C is unit elastic.

For each watch that Switzerland produces, it gives up the opportunity to make 50 pounds of chocolate. Germany can produce 1 watch for every 100 pounds of chocolate it produces. Which of the following is true about the comparative advantage between the two countries?

Switzerland has the comparative advantage in watches.

Assume that Mexico and the United States each has 2400 hours available. Applying the principle of comparative advantage, which of the following is true?

The U.S. should export limos, and Mexico should export jets.

In Singapore the government places a $5,000 tax on the buyers of new automobiles. After buying a new car, the buyer must pay the government $5,000. How would the imposition of the tax on buyers be illustrated in a graph?

The tax will shift the demand curve down by $5,000.

Refer to Table 4-4. Suppose that the quantity of labor demanded increases by 40,000 at each wage level. What are the new free market equilibrium hourly wage and the new equilibrium quantity of labor?

W = $11.50; Q = 610,000

Refer to Figure 2-4. A movement from ________ is the result of advancements in both plastics and food products production technology.

X to Y

The following table shows the cost of producing a good for the only four producers in a market. Producer. Cost W. $40 X $30 Y $20 Z $10 Refer to Table 7-19. If the market price is $28, which producers will supply units in the market?

Y and Z

Figure 4-8 shows the market for beer. The government plans to impose a per-unit tax in this market. As a result of the tax, is there a loss in consumer surplus?

Yes, because consumers pay a price above the economically efficient price.

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

a normal good.

When the government taxes a good or service, it

affects the market equilibrium for that good or service.

Regan grows flowers and makes ceramic vases. Jayson also grows flowers and makes ceramic vases, but Regan is better at producing both goods. In this case, trade could

benefit both Jayson and Regan

Suppose a tax of $2 per unit is imposed on this market. The new price the buyers pay will be

between $5 and $7

In the above figure, the long-run average cost curve exhibits diseconomies of scale

between 20 and 25 units per hour

Suppose a tax of $2 per unit is imposed on this market. What will be the new equilibrium quantity in this market?

between 50 and 100 units

Suppose the demand for macaroni is inelastic, the supply of macaroni is elastic, the demand for cigarettes is inelastic, and the supply of cigarettes is elastic. If a tax were levied on the sellers of both of these commodities, we would expect that the burden of

both taxes would fall more heavily on the buyers than on the sellers.

Tommy likes to consume lemonade with his sweet tea (as an "Arnold Palmer"). For Tommy, lemonade and sweet tea are

complements, and his cross-price elasticity of demand between the two goods is negative.

Refer to Table 2-1. Love faces ________ opportunity costs in the production of cakes and roast chicken.

constant

Specializing in the production of a good or service in which one has a comparative advantage enables a country to do which of the following?

consume a combination of goods that lies outside its own production possibilities frontier

Use the above figure to answer the following question. If the government imposes a price ceiling of $50 on this good, then total surplus will

decrease

Refer to Table 3-2. The table above shows the demand schedules for caviar of two individuals (Ari and Sonia) and the rest of the market. If the price of caviar rises from $65 to $75, the market quantity demanded would

decrease by 36 oz

Studies have shown that drinking one glass of red wine per day may help prevent heart disease. Assume this is true, and California has the best weather they've seen in decades (making for a huge production of grapes in the California vineyards). In the market for red wine, these two developments would

increase demand and increase supply, resulting in an increase in the equilibrium quantity and an ambiguous effect on the equilibrium price of red wine.

If a market is allowed to adjust freely to its equilibrium price and quantity, then an increase in demand will

increase producer surplus

Refer to Table 2-1. Assume Love's kitchen only produces cakes and roast chicken. A combination of 20 cakes and 60 roast chickens would appear

inside Love's production possibilities frontier.

If the market price is less than P2, in the short run, the perfectly competitive firm will earn

negative economic profit and shut down.

If the market price is less than P3 and greater than P2, in the short run, the perfectly competitive firm will earn

negative economic profit but continue to produce output.

Last year, Joan bought 50 pounds of hamburger when her household's income was $40,000. This year, her household income was only $30,000 and Joan bought 60 pounds of hamburger. All else constant, Joan's income elasticity of demand for hamburger is

negative, so Joan considers hamburger to be an inferior good.

If the market price is $8, in the long run,

new firms will enter the market.

If a firm raised its price and discovered that its total revenue fell, then the demand for its product is

relatively elastic.

The overriding reason why households and societies face many decisions is that

resources are scarce.

Refer to Figure: Hunter Hayes Concert Tickets. At a price of $15

there is a surplus of 4 tickets.

Refer to Figure 4-4. The figure above represents the market for pecans. Assume that this is a competitive market. If the price of pecans is $9

the quantity supplied is greater than the economically efficient quantity

This firm experiences diminishing marginal product of labor with the addition of which worker?

the sixth worker

Suppose that gasoline prices increase dramatically this month. Tammy commutes 100 miles to work each weekday. Over the next few months, Tammy drives less on the weekends to try to save money. Within the year, she sells her home and purchases one only 10 miles from her place of employment. These examples illustrate the importance of

the time horizon in determining price elasticity of demand.

Economists assume that rational people do all of the following except

undertake activities that benefit others and hurt themselves

If the market price is P3, in the short run, the perfectly competitive firm will earn

zero economic profit.

Refer to Figure 12-9. At price P1, the firm would produce

zero units