Microeconomics Final Exam Review
figure 8-2 consumer surplus without the tax is
$6 and consumer surplus with tax is $1.5
when large changes in price lead to no changes in quantity demanded, demand is perfectly
inelastic, and the demand curve will be vertical
When her income increased from $10,000 to $20,000, Heather's consumption of macaroni decreased from 10 pounds to 5 pounds and her consumption of soy-burgers increased from 2 pounds to 4 pounds. We can conclude that for Heather, macaroni
is an inferior good with an income elasticity of -1 and soy burgers are normal goods with an income elasticity of 1
if something happens to alter the quantity supplied at any given price, then
the supply curve shifts
the bow wow company produced and sold 350 dog beds. the average cost of production per dog bed was $35. each dog bed can be sold for a price of $45. bow wow's total cost is
$12,250
table 4-5 if the four suppliers listed are the only suppliers in this market and the market demand schedule is (shown) the equilibrium price and quantity are
$2 and 300 cases
suppose that when the price of good x increases 610-710 the quantity demanded of good y decreases from 51 to 15. use midpoint method, the corss price elasticity of demand is about
-7.20 and x and y are complements
table 3-6 which of the following points is on max's production possibilities frontier, based on a 36 hour production period
18 mittens zero hats
figure 8-2 the per unit burden of the tax on buyers is
3 dollars
Katherine gives piano lessons for $15 per hour. She also grows flowers, which she arranges and sells at the local farmer's market. One day she spends 5 hours planting $50 worth of seeds in her garden. Once the seeds have grown into flowers, she can sell them for $150 at the farmer's market. Katherine's accounting profits are
400 and economic profits are 175
if the price elasticity of demand for a good is 5 then a 10% increase in price results in a
50% decrease in the quantity demanded
if the price elasticy of supply is .6 and a price increase led to a 3.7 percent increase in quantity supplied then the price increase is about
6.17 percent
table 13-9 what is the marginal product of the third worker
60 units
when a tax is placed on the sellers of cell phones, the size of the cell phone market
and the effective price recieved by sellers both decrease
table 4-7who experiences the largest loss of consumer surplus when the price of an apple increases from .70 to 1.40
bob
on a graph the area below the demand curve and above the price measures
consumer surplus
figure 6-2 the price ceiling causes quantity
demanded to exceed quantity suppllied by 90 units
suppose the number of buyers in a market increases and a technological advancement occurs also. what would we expect to happen in the market
equilibrium quantity would increase but the impact on equilibrium price would be ambiguous
figure 14-7 if the market starts in equilibrium at point z in graph b, a decrease in demand will ultimately lead to
fewer firms in the market
table 8-1 suppose the government is considering levying a tax in one or more of the markets described in the table. which of the markets will allow the government to minimize the deadweight loss from the tax
markets b and d only
cost is a measure of the
sellers willingness to sell
figure 4-7; at price 15 there would be a
shortage of 400 units
a taz levied on the sellers of a good shifts the
supply curve upward or to the left
which of the following causes the price paid by buyers to be different than the price recieved by sellers
tax on the good
suppose sellers of cologne are required to send $1.50 to the gov for every bottole of cologne they sell. further, suppose this tax causes the price paid by buyers of cologne to rise by .90 per bottle. which of the following statements is correct
the effective price recieved by the sellers is .60 per bottle less than it was before the tax
table 2-2 which of the following statements is correct
the opportunity cost of an additional 100 toys increases as more toys are produced
what happens to the total surplus in a market when the government imposes a tax
total surplus decreases
consider the market for gasoline. buyers
would lobby for a price ceiling whereas sellers would lobby. for a price floor
figure 14-1 if the market price is exactly $6.5 the firm will earn
zero economic profits in the short run