MICRO ECON Exam 2

Ace your homework & exams now with Quizwiz!

Ceteris paribus, when supply shifts to the left, there is:

an increase in price and a decrease in consumer surplus.

According to the Coase Theorem, an efficient outcome can be achieved without any need for active government involvement as long as:

property rights are clearly defined and transaction costs are sufficiently low.

Goods that are both nonrival and nonexcludable are:

pure public goods

After a price floor is established above the equilibrium price in the market for strawberries:

the quantity of strawberries actually bought and sold decreases.

The Tragedy of the Commons refers to:

the tendency to use common resources more than is desirable from society's point of view.

Based on the information in the graph below, the tax generates tax revenue of _________ and a deadweight loss of _________.

$128; $16

Based on the information in the graph below, if there is a price ceiling of $5, then consumer surplus is equal to _______ and producer surplus is equal to ______.

$250; $50

Based on the information in the graph below, in free market equilibrium, total consumer and producer surplus is equal to _______.

$400

Which of the following is an example of a positive externality?

A lower crime rate in a neighborhood patrolled by a security company

Which of the following is not an example of government response to a market failure?

A privately-owned business that does not allow smoking

All of the following are examples of public goods except:

a bagel with cream cheese.

The economic burden of a tax:

is partially shifted to consumers through higher prices in most cases.

The purpose of setting a price ceiling below the equilibrium price is to:

maintain a low price for buyers in the market.

A demand curve can be interpreted as:

marginal benefit curve

An efficient level of an output exists when:

marginal benefit is equal to marginal cost.

Consumer surplus is the difference between ________ and product price and producer surplus is the difference between ________ and product price.

marginal benefit; marginal cost

Products that generate negative externalities tend to be:

overproduced by private markets.

A tax levied on gasoline is predicted to:

reduce production and consumption, leading to less pollution.

The Truth in Lending Act of 1968 protects consumers by:

requiring clear disclosure of the costs of credit.

The "free-rider" problem refers to a situation in which:

the benefits associated with public goods cannot be denied to users, whether or not they are willing to pay for them.


Related study sets

Quiz 12 Peripheral Nervous System

View Set

Equation of a Tangent Line Practice

View Set

Trauma, Crisis, Disaster, and Related Disorder Assessment

View Set

NURSE CH8 Online Exam Review Questions

View Set

pediatric success chapter 7 immunological

View Set