Chapter Quiz Chapter 7

A  $500

B  $100

C  $400

D  $300

E  $200

A  efficiency, Sue should receive the glove.

B  consumer surplus, both should receive a glove.

C  equality, Joe should receive the glove.

D  efficiency, Joe should receive the glove.

A  we must cut back on the consumption of other goods.

B  the benefit buyers place on medical care is equal to the cost of producing it.

C  buyers receive no benefit from another unit of medical care.

D  everyone has as much as they would like.

A  generate equality.

B  are inefficient.

C  are efficient.

D  maximize producer surplus.

A  the quantity produced in the market maximizes the sum of consumer and producer surplus.

B  the market allocates buyers to the sellers who can produce the good at least cost.

C  all of the choices are true

D  the market allocates output to the buyers who value it the most.

E  none of the above is true

A  are inefficient.

B  are efficient.

C  maximize consumer surplus.

D  generate equality.

A  free market solutions generate equality.

B  free market solutions are efficient and maximize total surplus.

C  all of the above are true.

A  choose a price below the market equilibrium price.

B  choose any price the planner wants because the losses to the sellers (buyers) from any change in price are exactly offset by the gains to the buyers (sellers).

C  allow the market to seek equilibrium on its own.

D  choose a price above the market equilibrium price.

A  maximizes total surplus and generates equality among the members of society.

B  maximizes total surplus.

C  minimizes total surplus.

D  generates equality among the members of society.

A  decreases producer surplus.

B  improves market equity.

C  increases producer surplus.

D  does all of the above.

A  below the demand curve and above the supply curve.

B  above the supply curve and below the price.

C  above the demand curve and below the price.

D  below the demand curve and above the price.

E  below the supply curve and above the price.

A  the maximum amount the seller is willing to accept for a good.

B  the minimum amount the seller is willing to accept for a good.

C  the seller’s consumer surplus.

D  the seller’s producer surplus.

E  none of the above.

A  consumer surplus is maximized.

B  the cost of production on the last unit produced exceeds the value placed on it by buyers.

C  the value placed on the last unit of production by buyers exceeds the cost of production.

D  total surplus is maximized.

E  producer surplus is maximized.

A  producer surplus is maximized.

B  the value placed on the last unit of production by buyers exceeds the cost of production.

C  consumer surplus is maximized.

D  total surplus is maximized.

E  the cost of production on the last unit produced exceeds the value placed on it by buyers.

A  above the demand curve and below the price.

B  below the supply curve and above the price.

C  below the demand curve and above the supply curve.

D  below the demand curve and above the price.

E  above the supply curve and below the price.

A  Three vases will be sold, and consumer surplus is $0.

B  Three vases will be sold, and consumer surplus is $80.

C  One vase will be sold, and consumer surplus is $5.

D  One vase will be sold, and consumer surplus is $30.

E  Two vases will be sold, and consumer surplus is $5.

A  improves the material welfare of the buyers.

B  improves market efficiency.

C  decreases consumer surplus.

D  increases consumer surplus.

A  $0

B  $58,000

C  $2,000

D  $28,000

E  $30,000

A  that buyer’s consumer surplus.

B  that buyer’s producer surplus.

C  that buyer’s minimum amount he is willing to pay for a good.

D  that buyer’s maximum amount he is willing to pay for a good.

E  none of the above.

A  below the demand curve and above the price.

B  below the supply curve and above the price.

C  below the demand curve and above the supply curve.

D  above the supply curve and below the price.

E  above the demand curve and below the price.