Economics Chapter 4 Surplus The Price Ticket See The Nutty

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Test Canvas : TestBanks Chapter 04: Consum er and Producer Surplus

Microeconom ics, 3e

Test Canvas: TestBanks Chapter 04: Consumer and Producer

Surplus

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1. True/False: A consumer’s willingness to pay for a…

Question A consumer‘s willingness to pay for a surfboard is the minimum price at which he

or she would buy the surfboard.

2. True/False: Gehrig is willing to pay $90 for a ca…

Question Gehrig is willing to pay $90 for a cap made of raccoon skin. Suppose he finds such

a cap for $71 on eBay. If Gehrig buys the cap, he will have an individual consumer

surplus of $71.

3. True/False: Consumer surplus is the amount buyers...

Question

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Consumer surplus is the amount buyers actually pay for a good minus the

maximum amount they are willing to pay for it.

4. True/False: One way to measure the gain to societ…

Question One way to measure the gain to society from a drug that has the potential to

reduce obesity is to measure what people are willing to pay for the good and

subtract the amount they have to pay.

5. True/False: If the cost of soybeans (the major in...

Question If the cost of soybeans (the major ingredient in tofu) decreases, consumer surplus

in the market for tofu will decrease.

6. True/False: Floyd‘s cost of selling haircuts is t…

Question Floyd’s cost of selling haircuts is the lowest price at which he is willing to sell

haircuts.

7. True/False: For calculating producer surplus, it …

Question For calculating producer surplus, it is important to distinguish between the

minimum price at which a seller is willing to sell a good and the seller‘s cost.

8. True/False: Producer surplus is the amount seller…

Question Producer surplus is the amount sellers receive from the sale of a good minus the

minimum amount they are willing to accept for supplying the good.

9. True/False: All else equal, when the supply curve...

Question All else equal, when the supply curve shifts left, the producer surplus increases.

Points: 0

10. True/False: If the price of gasoline rises, the p...

Question If the price of gasoline rises, the producer surplus of auto manufacturers

decreases.

11. True/False: The total surplus generated in the ma…

Question The total surplus generated in the market for blackberries is the total net gain to

consumers in that market.

12. True/False: Efficiency exists when there is no wa…

Question Efficiency exists when there is no way to make someone better off without making

someone else worse off.

13. True/False: Prices above equilibrium on agricultu…

Question Prices above equilibrium on agricultural products like milk exist to maximize the

consumer surplus.

14. True/False: A price below the equilibrium price w...

Question A price below the equilibrium price will cause a reduction in total surplus.

15. Multiple Choice: A consumer’s willingness to pay reflects

Question A consumer‘s willingness to pay reflects

Points: 0

16. Multiple Choice: A consumer’s willingness to pay depen…

Question A consumer‘s willingness to pay depends on

17. Multiple Choice: Reference: Ref 4-1 (Table: Willingne…

Question

Reference: Ref 4-1

(Table: Willingness to Pay for Basketball Sneakers) If the price of basketball

sneakers is $145, which player will purchase sneakers?

18. Multiple Choice: Reference: Ref 4-1 (Table: Willingne…

Question

Reference: Ref 4-1

(Table: Willingness to Pay for Basketball Sneakers) If the price of basketball

sneakers is $125, which players will purchase sneakers?

Points: 0

19. Multiple Choice: Reference: Ref 4-1 (Table: Willingne…

Question

Reference: Ref 4-1

(Table: Willingness to Pay for Basketball Sneakers) If the price of basketball

sneakers is $180, how many pairs will be purchased?

20. Multiple Choice: Reference: Ref 4-1 (Table: Willingne…

Question

Reference: Ref 4-1

(Table: Willingness to Pay for Basketball Sneakers) If the price of basketball

sneakers is $130, how many pairs will be purchased?

Answer 0

Points: 0

21. Multiple Choice: Reference: Ref 4-1 (Table: Willingne…

Question

Reference: Ref 4-1

(Table: Willingness to Pay for Basketball Sneakers) If the price of basketball

sneakers is $100, how many pairs will be purchased?

Answer 1

22. Multiple Choice: Reference: Ref 4-1 (Table: Willingne…

Question

Reference: Ref 4-1

(Table: Willingness to Pay for Basketball Sneakers) If the price of basketball

sneakers is $60, how many pairs will be purchased?

Points: 0

23. Multiple Choice: The consumers’ willingness to pay for…

Question The consumers‘ willingness to pay for a good is used to derive the __________ for

that good.

Answer producer surplus

24. Multiple Choice: The total consumer surplus for good X...

Question The total consumer surplus for good X can be calculated in all except one of the

following ways. Which is the exception?

Answer the sum of the individual consumer surpluses for all buyers of X

25. Multiple Choice: Reference: Ref 4-2 (Table: Consumer …

Question

Reference: Ref 4-2

(Table: Consumer Surplus and Phantom Tickets) Look at the table Consumer

Surplus and Phantom Tickets. If the price of a ticket to see Phantom of the Opera

is $50, then Robert’s consumer surplus is:

Answer $60.

Points: 0

26. Multiple Choice: Reference: Ref 4-2 (Table: Consumer …

Question

Reference: Ref 4-2

(Table: Consumer Surplus and Phantom Tickets) Look at the table Consumer

Surplus and Phantom Tickets. If the box office price of a ticket to see Phantom of

the Opera is $50 and there is no other market for tickets, the total consumer

surplus for the five students is:

Answer $100.

27. Multiple Choice: Reference: Ref 4-2 (Table: Consumer …

Question

Reference: Ref 4-2

(Table: Consumer Surplus and Phantom Tickets) Look at the table Consumer

Surplus and Phantom Tickets. If the box office price of a ticket to see Phantom of

the Opera is $130 and there is no other market for tickets, the total consumer

surplus for the five students is:

Answer $150.

Points: 0

28. Multiple Choice: Reference: Ref 4-3 (Table: Consumer …

Question

Reference: Ref 4-3

(Table: Consumer Surplus) Look at the table Consumer Surplus. If the price of a

ticket to see The Nutty Nutcracker is $50, Lois‘s consumer surplus is:

Answer $60.

29. Multiple Choice: Reference: Ref 4-3 (Table: Consumer …

Question

Points: 0

Reference: Ref 4-3

(Table: Consumer Surplus) Look at the table Consumer Surplus. If the price of a

ticket to see The Nutty Nutcracker is $50, Narum’s consumer surplus is:

Answer $60.

30. Multiple Choice: Reference: Ref 4-3 (Table: Consumer …

Question

Reference: Ref 4-3

(Table: Consumer Surplus) Look at the table Consumer Surplus. If the price of a

ticket to see The Nutty Nutcracker is $75, Lois‘s consumer surplus is:

Points: 0

31. Multiple Choice: Reference: Ref 4-3 (Table: Consumer …

Question

Reference: Ref 4-3

(Table: Consumer Surplus) Look at the table Consumer Surplus. If the price of a

ticket to see The Nutty Nutcracker is $75, Miguel’s consumer surplus is:

32. Multiple Choice: Reference: Ref 4-3 (Table: Consumer …

Question

Reference: Ref 4-3

(Table: Consumer Surplus) Look at the table Consumer Surplus. If the price of a

ticket to see The Nutty Nutcracker is $50 and there is no other market for tickets,

total consumer surplus for the five students is:

Points: 0

33. Multiple Choice: Reference: Ref 4-3 (Table: Consumer …

Question

Reference: Ref 4-3

(Table: Consumer Surplus) Look at the table Consumer Surplus. If the price of a

ticket to see The Nutty Nutcracker is $75 and there is no other market for tickets,

the total consumer surplus for the five students is:

Answer $190.

34. Multiple Choice: Reference: Ref 4-3 (Table: Consumer …

Question

Points: 0

Reference: Ref 4-3

(Table: Consumer Surplus) Look at the table Consumer Surplus. If the tickets to

The Nutty Nutcracker are free and there is no other market for tickets, the total

consumer surplus for the five students is:

Answer $0.

35. Multiple Choice: We can measure total consumer surplus...

Question We can measure total consumer surplus for good X as:

36. Multiple Choice: Consumer surplus for an individual bu...

Question Consumer surplus for an individual buyer is equal to:

Answer the consumer‘s willingness to pay for the good minus the marginal cost of

producing the good.

Points: 0

37. Multiple Choice: Consumer surplus can be found by comp...

Question Consumer surplus can be found by computing the area:

Answer above the supply curve and below the price.

38. Multiple Choice: Reference: Ref 4-4 (Table: Music Dow...

Question

Reference: Ref 4-4

(Table: Music Downloads) Look at the table Music Downloads. Two consumers, Eli

and Madison, like to download songs to their MP3 players, and the table

represents their willingness to pay for each downloaded song. If an individual song

can be downloaded at a price of $1, what is the total consumer surplus received by

these consumers?

Answer $19.25

39. Multiple Choice: Reference: Ref 4-5 (Table: Economics...

Question

Points: 0

Reference: Ref 4-5

(Table: Economics Textbooks) Look at the table Economics Textbooks. The table

shows how much money four consumers would be willing to pay for a new

economics textbook. If the price of the textbook is $100, what is the total

consumer surplus received by these consumers?

40. Multiple Choice: Figure: Monthly Demand for Ice Cream ...

Question Figure: Monthly Demand for Ice Cream Cones

Reference: Ref 4-6

(Figure: Monthly Demand for Ice Cream Cones) Look at the table Monthly Demand

for Ice Cream Cones. The graph represents one individual‘s monthly demand for ice

cream cones. At a price of $5 per cone, this individual will consume 10 cones in a

month. How much consumer surplus does this consumer receive?

Answer $100

Points: 0

41. Multiple Choice: Ashley bought a new pair of jeans. Wh...

Question Ashley bought a new pair of jeans. When she walked out of the store, she thought,

“I got such a great deal; I would have paid $40 more for these jeans!” This best

represents the concept of:

42. Multiple Choice: Mark and Rasheed are at the bookstore…

Question Mark and Rasheed are at the bookstore buying new calculators for the semester.

Mark is willing to pay $75 and Rasheed is willing to pay $100 for a graphing

calculator. The price for a calculator at the bookstore is $65. How much is total

consumer surplus?

Answer $10

43. Multiple Choice: Mark and Rasheed are at the bookstore…

Question Mark and Rasheed are at the bookstore buying new calculators for the semester.

Mark is willing to pay $75 and Rasheed is willing to pay $100 for a graphing

calculator. The price for a calculator at the bookstore is $65. How much is Mark‘s

individual consumer surplus?

Points: 0

44. Multiple Choice: Vonda and Aleiyah are shopping togeth...

Question Vonda and Aleiyah are shopping together at the mall for new jeans. Vonda is

willing to pay $90 and Aleiyah is willing to pay $50 for a pair of jeans. If the price of

jeans is $59, how much total consumer surplus is achieved in this market?

Answer $0

45. Multiple Choice: Consumer surplus is represented by th…

Question Consumer surplus is represented by the area ________ the demand curve and

________ the market price.

Answer above; below

46. Multiple Choice: Jeanette is willing to pay $100 for t...

Question Jeanette is willing to pay $100 for the first pair of shoes, $80 for the second pair,

$50 for the third, and $30 for the fourth. If shoes cost $50, Jeanette will buy

________ pairs of shoes and her total consumer surplus equals ________.

Answer 4; $110

47. Multiple Choice: Adie wants to take some online classe…

Question Adie wants to take some online classes this semester. She is willing to pay

$1,000 for the first class, $800 for the second, $700 for the third, and $500 for the

fourth. If online classes cost $750, Adie will take ________ online classes and her

consumer surplus will equal ________.

Answer 3; $350

Points: 0

48. Multiple Choice: Figure: Wireless Mouse Market Refer…

Question Figure: Wireless Mouse Market

Reference: Ref 4-7

(Figure: Wireless Mouse Market) Look at the figure Wireless Mouse Market. Use

the graph to calculate consumer surplus when the market is at equilibrium.

Answer $4,000

49. Multiple Choice: Figure: Market Demand Reference: Ref ...

Question

Points: 0

Figure: Market Demand

Reference: Ref 4-8

(Figure: Market Demand) Look at the figure Market Demand. The amount by which

the total benefits to consumers exceed their total expenditure is called ________,

and if the price is B, is depicted by the area ________.

Answer producer surplus; BCD

50. Multiple Choice: Along a given demand curve, an increa...

Question Along a given demand curve, an increase in the price of a good will cause

consumer surplus to:

Answer increase.

51. Multiple Choice: Which situation would most likely cau...

Question Which situation would most likely cause a decrease in consumer surplus in the toy

market?

Points: 0

52. Multiple Choice: Vonda and Aleiyah are shopping togeth...

Question Vonda and Aleiyah are shopping together at the mall for new jeans. Vonda is

willing to pay $90 and Aleiyah is willing to pay $50 for a pair of jeans. What is the

gain in total consumer surplus when the price decreases from $59 to $40?

Answer $10

53. Multiple Choice: Some smaller retailers often go out o...

Question Some smaller retailers often go out of business when Walmart opens a new store.

One of the reasons for this development could be that:

Answer Walmart practices unfair pricing methods that reduce consumer surplus over

time.

54. Multiple Choice: An increase in the consumer surplus i...

Question An increase in the consumer surplus in the market for milkshakes may result from:

Answer an increase in the price of milkshakes.

Points: 0