review3 - Chp 7 & chp 8 Multiple Choice Identify the...

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Multiple Choice Identify the letter of the choice that best completes the statement or answers the question. Figure 7-4 ____ 1. Refer to Figure 7-4. Which area represents producer surplus when the price is P 2 ? a. BCE b. ACF c. ABED d. AFEB ____ 2. Producer surplus is the a. area under the supply curve to the left of the amount sold. b. amount a seller is paid minus the cost of production. c. area between the supply and demand curves, above the equilibrium price. d. cost to sellers of participating in a market. Market Supply and Demand for Pepperoni Pizza Table 7-5 PRICE QUANTITY DEMANDED QUANTITY SUPPLIED $12.00 0 12 $10.00 4 10 $ 8.00 8 8 $ 6.00 12 6 $ 4.00 16 4 $ 2.00 20 2 ____ 3. Refer to Table 7-5 . As the table suggests, the demand curve is a straight line and so is the supply curve. Taking this into account, when there is equilibrium, producer surplus is a. $16. b. $24.
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c. $32. d. $48. ____ 4. Total surplus in a market is equal to a. Consumer surplus + Producer surplus. b. Value to buyers - Amount paid by buyers. c. Amount received by sellers - Costs of sellers. d. Producer surplus - Consumer surplus. Figure 7-11. On the graph below, Q represents the quantity of the good and P represents the good's price. ____ 5. Refer to Figure 7-11 . If four units of the good are produced and sold, then a. the cost to sellers exceeds the value to buyers. b.
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This note was uploaded on 07/06/2010 for the course CHEMICAL 26672 taught by Professor Ligl during the Spring '10 term at Boise State.

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review3 - Chp 7 & chp 8 Multiple Choice Identify the...

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