Econ Exam 2
(Refer to table 4-1) Kendra's marginal benefit from consuming the second ice cream cone
3.00
(Refer to table 4-1) Kendra's marginal benefit from consuming the first ice cream cone
3.50 dollars
a technological advancement would be represented by a movement from
S1 to S2
Monique buys a new television of 795. She receives consumer surplus of 355 dollars from the purchase. How much was her Television?
1150 dollars
Kendra's marginal benefit from consuming the third ice cream cone is
2.30
(Refer to table 4-1) The table above lists the highest prices of three customers curly moe and larry are willing to pay for a bottle of champagne. if the price of one of the bottles is 27 dollars, total consumer surplus will be
26 dollars
Juanita goes to the Hardware Emporium to buy a new circular saw. She is willing to pay $120 for a new saw, but buys one on sale for $85. Juanita's consumer surplus from the purchase is
35 dollars
(Refers to table 4-4) If minimum wage of 9.50 an hour is mandated, what is the quantity of labor demanded?
360,000
Refer to figure 3-4. At a price of 25 dollars how many units will be sold?
500
Brett buys a new cell phone for $100. He receives a consumer surplus of $80 from the purchase. How much does Brett value his cell phone?
60 dollars
Marco goes to the pet store to buy a dozen koi fish for his new koi pond. he is willing to pay 200 dollars for the dozen fish buy buys them for 140 dollars. Marco's consumer surplus from the purchase is
60 dollars
refers to 3-4. At a price of 20 dollars how many units will be sold ?
600
(Refers to figure 4-3)What area represents consumer surplus at P2
A
When ________ in a market, the total net benefit to society is maximized.
A competitive equilibrium is achieved
(Refers to figure 4-2) What area represents the decrease in producer surplus when the market price falls from P2 to P1
A+B
(Refers to figure 4-5) What is the area that reprensts consumer surplus after the imposition of the ceiling
A+B+D
(Refers to figure 4-3)What area represents a producer suplus at P2
B+D
(Refers to figure 4-2)what area represents producer surplus at a price of P1
C
(Refer to table 4-1) The table above lists the highest prices of three customers, curly, moe, and larry are willing to pay for a bottle of champagne. if the price of one of the bottles is 24 dollars
Curly will recieve 26 dollars of consumer surplsus from buying one bottle
A decrease in the number of firms in a market will cause supply to increase
False
A positive technological change will cause the quantity of a good supplied to increase
False
All else equal, as the price of a product falls, the quantity supplied decreases
False
An increase in quantity supplied is represented by a rightward shift of the supply curve
False
An inferior good is a good whose quantity demanded increases as the price decreases , holding everything else constant
False
If consumers believe that the price of computer and tablet computers will increase in the future, this will cause the demand for tablet computers to decrease now
False
If the price of a product is expected to increase in the future, the supply today will increase
False
If the price of peaches, a substitute for plums, increases the demand for plums will decrease.
False
Peanut butter and jelly are complements. If the price of peanut butter increases, the demand for jelly will increase
False
a decrease in supply is caused by a decrease in the price of the product
False
the income effect explains why there is usually a direct relationship between the price of product and the quantity of the product demanded
False
The table above shows the demand schedules for Kona coffee of two individuals (Luke and Ravi) and the rest of the market. If the price of kona Coffee falls from 6 dollars to 4 dollars the market quantity demanded would
Increase by 61 lbs
suppose that when the price of oranges decreases, sanrita decreases her purchases of peaches. To sanrita -
Oranges and Peaches are substitutes
assume that the graph in this figure represent the demand and supply curves for laptop computers. which panel best describes what happens in this market when the price of computer hard drives falls?
Panel A
assume that the graphs in this figure represent the demand and supply curves for blu-ray discs. Which pannel best describes what happens in this market if there is a substantial increase in the price of blu-ray players?
Panel D
(Refers to figure 4-5) With rent control, the quantity supplied is Q1. Suppose apartment owners ignore the law and rent this quantity for the highest rent they can get. What is the highest rent they can get?
R1
a decrease in the price of inputs would be represented by a movement from
S1 to S2
an increase in the expected future price of the product would be represented by a movement from
S2 to S1
if the united states lifts the emargo on cuban products, what will happen in the us market for cuban cigars
The supply curve will shift to the the right
A decrease in the price of inputs will cause the supply curve for a product to shift to the right
True
An increase in population results in an increase in demand
True
The substitution effect explains why there is an inverse relationship between the price of a product and the quantity of the product demanded
True
a change in quantity supplied is represented by a movement along the supply curve
True
a normal good is a good for which the demanded decreases as income decreases, holding everything else constant
True
(Refers to table 4-4) what is the equilibrium hourly wage and the equilibrium quantity of labor
W=9.00; Labor=370,000
which of the following would shift the supply curve for energy drinks to the left?
a decrease in the number of firms that produce energy drinks
Which of the following would shift the supply curve for smartphones to the right?
a decrease in the price of an input used to produce smartphones
hurricane katrina damaged a large portion of the refining and pipline capacity when it swept through the gulf coast states in august 2005. As a result of this many gasoline distributors were not able to produce normal deliveries. At the pre-hurricane quilibrium price we would expect to see
a shortage of gasoline
electric car enthusiasts want to buy more electric cars at a lower price. All of the following events would have this effect except-
an increase in the price of gasoline
Indicate if this would whether each of the following situations would shift the supply curve to the left, to the right, or not at all e.a decrease in the current price of the product
no shift at all
which of the following would cause a decrease in the supply of peanut butter?
an increase on the price of peanuts
If a decrease in income leads to an increase in the demand for macaroni is
an inferior good
at a products equilibrium price
any buyer who is willing and able to pay the price will find a seller for the product.
In Venezuela, the government attempted to control rising food prices by implementing price ceilings in the market. These prices were set _____ the market prices, which resulted in _____ of food
below;shortages
The table above shows the demand schedules for Kona coffee of the two individuals (Luke and Ravi) and the rest of the market. If the price of Kona coffee rises from 4 dollars to five, the market quantity demanded would-
decrease by 35 Lbs
what would happen in the market for knee replacement surgery if insurance companies started to consider a smaller portion of the cost of the surgery
demand will decrease, but this will not shift the supply curve
_____ is defined as a market outcome in which the marginal benefit to consumers of the last unit produced is equal to the marginal cost of production and in which the sum of consumer surplus and producer surplus is at a maximum
economic efficiency
suppose that when the price of hamburgers increase, the ruiz family increases their purchases of hot dogs. To the ruiz family-
hamburgers and hot dogs are substitutes
The difference between the _____ for a good and the ____ is called consumer surplus
highest price a customer is willing to pay; price the consumer actually pays
Indicate if this would whether each of the following situations would shift the supply curve to the left, to the right, or not at all a. an increase in the price of an input
left
Indicate if this would whether each of the following situations would shift the supply curve to the left, to the right, or not at all c. an increase in the price of a substitute in production
left
Economic surplus is maximized in competitive market when
marginal benefit equals marginal cost
The additional cost to a firm of producing one more unit of a good or service is the
marginal cost
(Refer to table 4-3) The table above lists the marginal cost of polo shirts by Marko's a firm that specializes in selling men's clothing. If the market price of marko's polo shirt is 18 dollars
producer surplus will equal 22 dollars
At market equilibrium-
quantity demanded = quantity supplied
Indicate if this would whether each of the following situations would shift the supply curve to the left, to the right, or not at all b. an increase in productivity
right
Indicate if this would whether each of the following situations would shift the supply curve to the left, to the right, or not at all d.a decrease in the expected future price of a product
right
when the price of a good rises, consumers buy a smaller quantity because of the ____ effect and the _____ effect
substitution; income
factory incentives on cell phones have encouraged consumers to upgrade their phones. How does this affect the market for Bluetooth headsets?
the demand for Bluetooth hradsets increases
assume the price for lawn care has fallen and sales of lawn care services have also fallen. One can conclude that-
the demand for lawn care services has increased
refers to 3-4. If the price is 20 dollars-
the market is in equilibrium
By drawing a demand curve with the price on the vertical axis and quantity on the horizontal axis, economists assume that the most important determinant of the demand for a good is the
the price of the good
which of the following is evidence of a shortage of chocolate?
the quantity of chocolate demanded is greater than the quantity supplied
which of the following describes a characteristic of a perfectly competitive market?
there are many buyers and sellers
refers to figure 3-5. At a price of 5 dollars
there is a shortage of 4 units
refers to figure 3-5. At a price of 0 dollars
there is a shortage of 8 units
Refer to figure 3-4. If the price is 25 dollars
there is a surplus of 300 units
The maximum price that a buyer is willing to pay for good measures his
willingness to pay
