7-2 to 7-4
Refer to Table 7-15. If each producer has one unit available for sale, and if the market equilibrium price is $70, how much is the combined total cost of all participating sellers in the market?
$100
Refer to Figure 7-11. If the supply curve is S', the demand curve is D, and the equilibrium price is $150, what is the producer surplus?
$625
Refer to Figure 7-10. Which area represents producer surplus when the price is P2?
ACH
Refer to Figure 7-10. Which area represents the increase in producer surplus when the price rises from P1 to P2?
AHGB
Refer to Figure 7-23. At equilibrium, producer surplus is represented by the area
D+H+F
Efficiency is attained when Correct!
Total surplus is maximized
Which of the following will cause a decrease in producer surplus?
income increases and buyers consider the good to be inferior
Inefficiency exists in a market when a good is
not being produced by the lowest-cost producers
Refer to Figure 7-22. If 40 units of the good are bought and sold, then
the marginal value to buyers is greater than the marginal cost to sellers.
Refer to Table 7-16. Both the demand curve and the supply curve are straight lines. At equilibrium, total surplus is
$72
Laissez-faire is a French expression which literally means
Allow them to do
Refer to Figure 7-22. Assume demand increases, which causes the equilibrium price to increase from $50 to $70. The increase in producer surplus would be
$1,600
Refer to Figure 7-19. If the government imposes a price floor of $55 in this market, then total surplus will be
187.50
Suppose that Firms A and B each produce high-resolution computer monitors, but Firm A can do so at a lower cost. Cassie and David each want to purchase a high-resolution computer monitor, but David is willing to pay more than Cassie. If Firm A produces a monitor that Cassie buys but David does not, then the market outcome illustrates which of the following principles? (i)Free markets allocate the supply of goods to the buyers who value them most highly, as measured by their willingness to pay.(ii)Free markets allocate the demand for goods to the sellers who can produce them at the least cost.
ii only
According to many economists, government restrictions on ticket scalping do all of the following except
keep the cost of tickets to all consumers low.