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Unformatted text preview: Econ 301 Practice Problems for Consumer and Producer Welfare, and Competitive Equilibria MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) You pay $15 for an all- you- can- eat mongolian buffet. The food isn't so good, but deFnitely edible. When you Fnish eating, what is the marginal value of the last bite of food you consumed? A) negative B) $15 C) zero D) positive 1) 2) Joe's demand for spring water can be represented as p = 10- Q (where p is measured in $/gallon and Q is measured in gallons). He recently discovered a spring where water can be obtained free of charge. His consumer surplus from this water is A) $0. B) $100. C) $50. D) unknown based upon the information provided. 2) 3) Mister Jones was selling his house. The asking price was $220,000, and Jones decided he would take no less than $200,000. After some negotiation, Mister Smith purchased the house for $205,000. Jones' producer surplus is A) $15,000....
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This note was uploaded on 04/10/2012 for the course ECN 100B taught by Professor Jamesbushnell during the Fall '11 term at UC Davis.
- Fall '11