Exam 2 - xv Test Form A Principles of Microeconomics Name...

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Unformatted text preview: xv Test Form A September 13, 2004 Principles of Microeconomics Name Qfl’imflzfl Ari. dM’ s Emmi, GT in bi (i) ii I i .i i L. i l 2 3 4 5 b urs per month) A w v Quantity (millions of ho Mzww v 1) In the figure above, if the minimum wage is $4 per hour, then y—L \_r A) the quantity of labor supplied is 3 million hours and the quantity of labor demanded is 3 million hours. B) unemployment is 1 million hours. C) the quantity of labor demanded is 4 million hours and the quantity of labor supplied is 2 million hours. D) the quantity of labor supplied is 4 million hours and the quantity of labor demanded is 2 million hours. ” ‘ 3 : »~t’~.~$“ ,zzmfiéfiiwmmm 'Awlfémafilfiwfly S + tax on seller 1:. O (a) 0 Price {doliors per CD) N O 10 L i .1 J... 1 _|.____...«._L 0 10 20 30 40 50 60 7O 80 Quantity (minions of CD5 per year) 24; t»: :‘z‘ firm A,» r71 2) In the above figure, the price paid by the buyer before the tax is per compact disc, and the 2) ,3 price paid by the buyer after the tax is per compact disc. A) $30; $30 B) $20; $30 C) $20; $20 D) $30; $20 3) In the above figure, what is the amount (size) of the tax per compact disc? 3) i A) $40 B) $30 C) $20 D) $10 WWWWIR Ln) 0 Price (dollars per pair of gloves) 25 ‘ \ ( H 20 X L- ,1 l5 \ , / D 3 MB /’v\ J. \ \ / \/ 3 4 5 (thousands of gloves per day) ~m»;»mW~/m 4) 1n the above figure, if the production of gloves was restricted to 2,000 a day, then the deadweight loss would equal A) $0, because 2,000 gloves per day is an efficient quantity of gloves to produce. B) $2,000. C) $10,000. D) $5,000. 5) In the above figure, when the efficient quantity of gloves is produced, die producer surplus equals A) $22,500. B) $15,000. C) $45,000. D) $3,000. 6) If the (marginal) gain that consumers receive from the fifth slice of pizza is greater than the marginal cost of the fifth slice of pizza then the output level is A) efficient and less pizza should be produced. B) inefficient and more pizza should be produced. C) efficient and more pizza should be produced. D) inefficient and less pizza should be produced. 7) A tax is imposed on the sellers of gasoline. This tax shifts A) the supply of gasoline curve downward. B) both. the supply of gasoline and demand for gasoline curves leftward. C) the demand for gasoline curve upward. D) the supply of gasoline curve upward. 8) Nick can purchase each milkshake for $2. For the first milkshake purchased Nick is willing to pay $4, for the second milkshake $3, for the third milkshake $2 and for the fourth milkshake $1. What is the value of Nick's consumer surplus? A) $10 is) (“>07 D) 9 I . 8) 9) A price floor set below the equilibrium price 9) b A) restricts the quantity supplied but not the quantity demanded. B) has no effect. C) restricts the quantity demanded but not the quantity supplied. D) restricts both the quantity demanded and the quantity supplied. 10) Suppose a country produces only bikes and clothing. The country achieves an efficient allocation of 10) /\/ resources when A) it produces equal amount of bikes and clothes. R\ if nan't rnAnr-n an u] 1 u \. n y mn‘ro In Lull u FLU H‘— ulvu, u in 1) C) the prices charged for the goods are as low as possible. D) there is no deadweight loss. ‘ ,‘T‘KT‘rD‘, XX“? "" 'Féhfifl<W“”""~"?$3% 0:: C) C: 0 O 0 Rent (dollars per month) 3' o 500 1100 11) In the figure above, originally the apartment rental market is in equilibrium with a rental price of 11) A $600 per month. Then the government imposes a rent ceiling of $500 per month. If the law is enforced, the maximum for which an apartment will rent on the black market is strict! v J A \ r-Inn , A ,_ .1, n\ , .I,, mr—rnn , .1 A) IUU PEI HIUHUL DI IIIUIC “16111 31/ UU per (“Until $ C) $600 per month. D) less than $600 per month. S=MC Price {dollars per purse} 1:. o T 2 a". r J e l f 1 O l 00 200 300 1100 500 60 Quantity (thousands of purses per month) <3 EL mm» , away“; 12) In the above figure, 300,000 purses per month is 12) A) the efficient amount to produce because consumer surplus is maximized. B) a is not maximized. . i efficient C) the efficient amount to produce because the sum of consumer surplus and producer surplus is maximized. D) an inefficient amount to produce because consumer surplus is not maximized. 13) In the market for CD3, the producer surplus will decrease if . 13) _.. A) the mar inal cost of a CD decreases B) twe market price of a CD ~ncreases O D C) the demand for CD5 decreases D) the supply of CD5 increases 'E 3 r -.-. o. n l/ 2 A . 1,, /, 2 t4 _ *5 7 *0 x w t. 0.) .2 a: t 6" ; _ a / i U 3 \{l ‘ t/ ,a : \\1 i / 4/ § L, l 1 i; O l O 20 30 40 50 60 Quantity (units) 14) In the above figure, suppose that the government sets a quota at 10 units of output and the price rises to $4. In comparison to a competitive market the consumer surplus would fall by A) $20. B) $15. C) $0. D) $10. 15) Surnlus nrodi. ’ r r A) minus its marginal cost of production B) subtracted f‘or‘t the value of the good C) times the quantity sold D) plus 9 consumer surplus 3% Pryce (dollars per ton of wheat) 5 O Q j _,i i 3 4 5 6 Quantity (tons ol wheat per year) r " :msut' 4? ' W ,, 5w 16) In the above figure, the lowest price for which the firm will sell its second ton of wheat is A) $25. B) $50. C) $100. D) $75. m 14) J1 15> A I i ‘3 16) 17) The deadweight loss from producing an inefficient amount is 17) l J A) a gain to the consumer and the producer, but a loss to the rest of society. B) a loss to the producer but a gain to the consumer. C) a loss to the consumer but a gain to the producer. D) a loss to the consumer and to the producer. 5" Ln 0 I Price (dollars per bcgle} Ix) o O r; M B r i ; L. 0 lo 20 3 0 Quantity lbagles per hour) :‘ w - >2 re» s '1‘ J»; 4&5 u f‘) 18) The figure illustrates the market for bagels. If the number of bagels is cut from 20 to 10 an hour, the 18) D deadweight loss is . A) —$5.00 an hour B) $5.00 an hour C) $0 an hour D) $0.50 a bagel 19) As we move up along the supply curve for hot dogs, 19) f—«E A) the marginal cost of hot dogs increases. B) the value of hot dogs decreases. C) the maximum price that people are willing to pay for hot dogs increases. \ L r -rdmud 1,, H. MAI"; _ r I- A. .1. AA LA -1“ _ D} tilt: LUllbUlllfil bulplub U1 llUl U053 lIlL'l'Cd 'Cb- § 41“ MC / / .0 (.n O Marginal cost and marginal benefit // / MB 1 l J 2 4 6 8 Quontiiy [thousands of hot dogs per day) “‘3‘an /r”‘r.?$“%‘i/;\ (dollars worth of goods and sewices) S o O “8‘ i 20) In the above figure, what is the efficient quantity of hotdogs to produce? A) 6 thousand per day B) 2 thousand per day C) 4 thousand per day D) The efficient quantity cannot be determined without knowing the income distribution of this economy. ()0 ...
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Exam 2 - xv Test Form A Principles of Microeconomics Name...

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