Chapter 4 PQ

# Chapter 4 PQ - Exam Name MULTIPLE CHOICE Choose the one...

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Name___________________________________ MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. Table 4 - 1 Consumer Willingness to Pay Tom \$40 Dick \$30 Harriet \$25 1) Refer to Table 4 - 1. The table above lists the highest prices three consumers, Tom, Dick and Harriet, are willing to pay for a short - sleeved polo shirt. If the price of the shirts falls from \$28 to \$20 1) A) consumer surplus increases from \$14 to \$35. B) Harriet will receive more consumer surplus than Tom or Dick. C) Tom will buy two shirts; Dick and Harriet will each buy one shirt. D) consumer surplus will increase from \$70 to \$95. Table 4 - 2 Marko's Polos Marginal Cost (Dollars) 1st shirt \$7 2nd shirt 10 3rd shirt 15 4th shirt 20 2) Refer to Table 4 - 2. The table above lists the marginal cost of polo shirts by Marko's, a firm that specializes in producing men's clothing. If the market price of Marko's polo shirts is \$18 2) A) producer surplus from the first shirt is \$18. B) there will be a surplus; as a result, the price will fall to \$7.

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## This note was uploaded on 05/02/2009 for the course ECON 2010 taught by Professor Roussel during the Spring '08 term at LSU.

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Chapter 4 PQ - Exam Name MULTIPLE CHOICE Choose the one...

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