Econ Final

Refer to Figure 7-2. If the price of the good is $100, then consumer surplus amounts to a. $50. b. $75. c. $100. d. $125.

D

Refer to Figure 8-1. Suppose the government imposes a tax of P' - P'''. Total surplus before the tax is measured by the area a. I+Y. b. J+K+L+M. c. L+M+Y. d. I+J+K+L+M+Y

D

Refer to Figure 8-1. Suppose the government imposes a tax of P' - P'''. The area measured by J represents a. consumer surplus after the tax. b. consumer surplus before the tax. c. producer surplus after the tax. d. producer surplus before the tax.

A

Producer surplus is the area a. under the supply curve. b. between the supply and demand curves. c. below the price and above the supply curve. d. under the demand curve and above the price.

C

Where can an economy produce?

Under and on the curve

Refer to Figure 8-1. Suppose the government imposes a tax of P' - P'''. The deadweight loss due to the tax is measured by the area a. J+K+L+M. b. J+K+L+M+N. c. I+Y. d. I+Y+B.

C

What happens when quantity supplied decreases?

results in a movement downward and to the left along a fixed supply curve

Refer to Figure 7-3. When the price rises from P1 to P2, consumer surplus a. increases by an amount equal to A. b. decreases by an amount equal to B+C. c. increases by an amount equal to B+C. d. decreases by an amount equal to C.

B

Are rebates good or bad for the consumer?

Bad

A macroeconomist - as opposed to a microeconomist - would study a. the effects of rent control on housing in New York City. b. the effects of foreign competition on the US auto industry. c. the effects of borrowing by the federal government. d. the effects of raising the gasoline tax on transit ridership

C

Refer to Figure 4-15. Which of the following would cause the supply curve to shift from Supply A to Supply C in the market for sailboats? a. an increase in the price of sailboats b. a decrease in the number of firms selling sailboats c. a decrease in the price of fiberglass and sailcloth d. a decrease in the price of America's Cup sailing t-shirts

C

What causes a decrease in surplus from market distortion? I.e tax?

Deadweight

Positive statement

Statement that has an answer to a problem