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Consumers, Producers, and the Efficiency of Markets 1893
58. Refer to Figure 7-22. Assume demand increases, which causes the equilibrium price to increase
from $50 to $70.
The increase in producer surplus due to new producers entering the market would be
a. $400.
b. $800.
c. $1,200.
d. $900.
59. Refer to Figure 7-22. Assume demand increases, which causes the equilibrium price to increase
from $50 to $70.
The increase in producer surplus to producers already in the market would be
a. $1,600.
b. $600.
c. $800.
d. $1,200.
1894 Consumers, Producers, and the Efficiency of Markets
60. 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
a. $2,500.
b. $900.
c. $800.
d. $1,600.
61. Refer to Figure 7-22. The efficient price is
a. $80, and the efficient quantity is 50.
b. $70, and the efficient quantity is 60.
c. $70, and the efficient quantity is 100.
d. $50, and the efficient quantity is 60.
Consumers, Producers, and the Efficiency of Markets 1895
62. Refer to Figure 7-22. If 110 units of the good are bought and sold, then
a. the marginal cost to sellers is equal to the marginal value to buyers.
b. the marginal value to buyers is greater than the marginal cost to sellers.
c. the marginal cost to buyers is greater than marginal value to sellers.
d. producer surplus is greater than consumer surplus.
63. Refer to Figure 7-22. If 40 units of the good are bought and sold, then
a. the marginal cost to sellers is equal to the marginal value to buyers.
b. the marginal value to buyers is greater than the marginal cost to sellers.
c. the marginal cost to sellers is greater than the marginal value to buyers.
d. producer surplus would be greater than consumer surplus.
1896 Consumers, Producers, and the Efficiency of Markets
Figure 7-23
64. Refer to Figure 7-23. The equilibrium price is
a. P1.
b. P2.
c. P3.
d. P4.
65. Refer to Figure 7-23. At equilibrium, consumer surplus is represented by the area
a. A.
b. A+B+C.
c. D+H+F.
d. A+B+C+D+H+F.
Consumers, Producers, and the Efficiency of Markets 1897
66. Refer to Figure 7-23. If the price were P3, consumer surplus would be represented by the area
a. A.
b. A+B+C.
c. D+H+F.
d. A+B+C+D+H+F.
67. Refer to Figure 7-23. At equilibrium, producer surplus is represented by the area
a. F.
b. F+G.
c. D+H+F.
d. D+H+F+G+I.
68. Refer to Figure 7-23. If the price were P1, producer surplus would be represented by the area
a. F.
b. F+G.
c. D+H+F.
d. D+H+F+G+I.
1898 Consumers, Producers, and the Efficiency of Markets
69. Refer to Figure 7-23. At equilibrium, total surplus is represented by the area
a. A+B+C.
b. A+B+D+F.
c. A+B+C+D+H+F.
d. A+B+C+D+H+F+G+I.
70. Refer to Figure 7-23. The efficient price-quantity combination is
a. P1 and Q1.
b. P2 and Q2.
c. P3 and Q1.
d. P4 and 0.
Consumers, Producers, and the Efficiency of Markets 1899
Figure 7-24
71. Refer to Figure 7-24. At equilibrium, consumer surplus is measured by the area
a. AHG.
b. AFB.
c. ABD.
d. BDF.
1900 Consumers, Producers, and the Efficiency of Markets
72. Refer to Figure 7-24. At equilibrium, consumer surplus is
a. $18.
b. $36.
c. $54.
d. $72.
73. Refer to Figure 7-24. At equilibrium, producer surplus is measured by the area
a. ABD.
b. ABF.
c. CDI.
d. BDF.
Consumers, Producers, and the Efficiency of Markets 1901
74. Refer to Figure 7-24. At equilibrium, producer surplus is
a. $36.
b. $72.
c. $54.
d. $18.
75. Refer to Figure 7-24. At equilibrium, total surplus is measured by the area
a. ABD.
b. ABF.
c. FBD.
d. HGCI.
1902 Consumers, Producers, and the Efficiency of Markets
76. Refer to Figure 7-24. At equilibrium, total surplus is
a. $36.
b. $54.
c. $18.
d. $108.
77. Refer to Figure 7-24. The equilibrium allocation of resources is
a. efficient because total surplus is maximized at the equilibrium.
b. efficient because consumer surplus is maximized at the equilibrium.
c. inefficient because consumer surplus is larger than producer surplus at the equilibrium.
d. inefficient because producer surplus is not maximized.
Consumers, Producers, and the Efficiency of Markets 1903
78. Refer to Figure 7-24. If 4 units of the good are produced and sold, then
a. producer surplus is greater than consumer surplus.
b. consumer surplus is $16.
c. total surplus is minimized.
d. total surplus is not maximized.
79. Refer to Figure 7-24. If 10 units of the good are produced and sold, then
a. the marginal cost to sellers exceeds the marginal value to buyers.
b. producer surplus is maximized.
c. total surplus is minimized.
d. the marginal value to buyers exceeds the marginal cost to sellers.
1904 Consumers, Producers, and the Efficiency of Markets
80. Refer to Figure 7-24. If 6 units of the good are produced and sold, then
a. consumer surplus is greater than producer surplus.
b. producer surplus is maximized.
c. the sum of consumer surplus and producer surplus is maximized.
d. consumer surplus equals producer surplus.
81. Refer to Figure 7-24. If 6 units of the good are produced and sold, then
a. efficiency is achieved in this market.
b. the marginal value to buyers equals the marginal cost to sellers.
c. the sum of consumer surplus and producer surplus is maximized.
d. All of the above are correct.
Consumers, Producers, and the Efficiency of Markets 1905
82. Refer to Figure 7-24. If the government imposes a price floor at $18, then consumer surplus is
a. ABF.
b. AGH.
c. HGCD.
d. HGBF.
83. Refer to Figure 7-24. If the government imposes a price ceiling at $12, then producer surplus is
a. CDI.
b. BDF.
c. BCIF.
d. HGCD.
1906 Consumers, Producers, and the Efficiency of Markets
Figure 7-25
84. Refer to Figure 7-25. At the equilibrium price, total surplus is
a. $288.
b. $576.
c. $1,152.
d. $2,304.
Consumers, Producers, and the Efficiency of Markets 1907
85. Refer to Figure 7-25. Suppose the government imposes a price ceiling of $16 in this market. If
the buyers with the highest willingness to pay purchase the good, then total surplus will be
a. $256.
b. $768.
c. $1,024.
d. $1,280.
86. Refer to Figure 7-25. Suppose the government imposes a price floor of $28 in this market. If
the sellers with the lowest cost are the ones who sell the good and the government does not
purchase any excess units produced, then total surplus will be
a. $400.
b. $800.
c. $1,120.
d. $1,184.
1908 Consumers, Producers, and the Efficiency of Markets
Figure 7-26
87. Refer to Figure 7-26. At the equilibrium price, consumer surplus is
a. $600.
b. $900.
c. $1,500.
d. $1,800.
Consumers, Producers, and the Efficiency of Markets 1909
88. Refer to Figure 7-26. At the equilibrium price, producer surplus is
a. $600.
b. $900.
c. $1,200.
d. $1,800.
89. Refer to Figure 7-26. At the equilibrium price, total surplus is
a. $600.
b. $1,200.
c. $1,500.
d. $1,800.
90. Refer to Figure 7-26. If the government imposes a price floor of $90 in this market, then
consumer surplus will be
a. $225.
b. $450.
c. $975.
d. $1,350
Figure 7-27
Consumers, Producers, and the Efficiency of Markets 1911
91. Refer to Figure 7-27. Buyers who value this good more than the equilibrium price are
represented by which line segment?
a. AC.
b. CK.
c. BC.
d. CH.
92. Refer to Figure 7-27. Buyers who value this good less than the equilibrium price are
represented by which line segment?
a. AC.
b. CK.
c. BC.
d. CH.
1912 Consumers, Producers, and the Efficiency of Markets
93. Refer to Figure 7-27. Sellers whose costs are less than the equilibrium price are represented by
which line segment?
a. AC.
b. CK.
c. BC.
d. CH.
94. Refer to Figure 7-27. Sellers whose costs are greater than the equilibrium price are represented
by segment
a. AC.
b. CK.
c. BC.
d. CH.
