Micro Econ test 2 BYUI

Carlos buys six new plants for his garden. If he has purchased according to the rational rule, his consumer surplus on the sixth plant is equal to:

zero.

An external benefit is:

A benefit accruing to bystanders.

What is the economically efficient quantity of watermelons?

5

A government uses taxes to build and maintain a museum, and citizens can visit the museum without paying an admission fee. Which of the following considerations implies that visiting a museum is NOT a public good?

Although enjoying the exhibits might be nonrival, the experience is excludable because admittance could easily be limited to those who pay

An external cost is

a cost imposed on bystanders.

A monopolistically competitive industry consists of:

many firms producing somewhat differentiated products.

Refer to the market for child care that is shown in the figure. The original equilibrium price is $10,000. A subsidy is now introduced for parents who pay for child care. After the subsidy is implemented the amount that parents pay is:

$9,000.

A firm in an oligopoly knows that it's ___ affect its ___ and that the reactions of its rivals will affect it. actions;

actions; rivals

Competitive Market in the Presence of Externalities. Given the figure, if there are external costs:

resources will be over allocated to the production of the good.

Competitive Market in the Presence of Externalities. Given the figure, if there are external benefits:

resources will be under allocated to the production of the good

The graph shows the marginal social benefit, demand, and supply curves in the toothbrush market. What are the socially optimal quantity and price?

six; $6

If a monopolist produces a quantity that generates MC < MR, then profit:

can be increased by increasing output

Candice's stand-up paddleboard company will earn profits producing and selling at any output level where the company's:

demand curve is above its average cost curve

The graph shows the marginal social benefit, demand, and supply curves in the toothbrush market. Market forces would yield a quantity of _____, whereas the socially optimal quantity is _____.

eight, 12

The graph show the marginal social benefit, demand, and supply curves in the milkshake market. Market forces would yield a quantity of _____ and a price of _____ in the milkshake market.

eight; $2