my answers to econ mid2

300 b 450 c 1550 d 2100 13 refer to table 7 2

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Unformatted text preview: 4.50. c. $15.50. d. $21.00. 13. Refer to Table 7-2. If the market price is $3.80, a. David’s consumer surplus is $4.70 and total consumer surplus for the five individuals is $9.50. b. Megan’s consumer surplus is $1.70 and total consumer surplus for the five individuals is $9.80. c. David, Laura, and Megan will be the only buyers of Vanilla Coke. d. the demand curve for Vanilla Coke, taking the five individuals into account, is horizontal. Table 7-3 The only four consumers in a market have the following willingness to pay for a good: Buyer Carlos Quilana Wilbur Ming-la Willingness to Pay $15 $25 $35 $45 14. Refer to Table 7-3. If the market price for the good is $30, who will purchase the good? a. Carlos only b. Carlos and Quilana only c. Carlos, Quilana, and Wilbur only d. Wilbur and Ming-la only 15. Refer to Table 7-3. If there is only one unit of the good and if the buyers bid against each other for the right to purchase it, then the good will sell for a. $15 or slightly less. b. $25 or slightly more. c. $35 or slightly more. d. $45 or slightly less. 16. Refer to Table 7-3. If there is only one unit of the good and if the buyers bid against each other for the right to purchase it, then the consumer surplus will be a. $0 or slightly more. b. $10 or slightly less. c. $30 or slightly more. d. $45 or slightly less. 17. Refer to Table 7-3. If the price is $30, then consumer surplus in the market is a. $20, and Wilbur and Ming-la purchase the good. b. $20, and Carlos and Quilana purchase the good. c. $30, and Wilbur and Ming-la purchase the good. d. $30, and Carlos and Quilana purchase the good. 18. Refer to Table 7-3. Who experiences the largest loss of consumer surplus when the price of the good increases from $20 to $22? a. Quilana b. Wilbur c. Ming-la d. All three buyers experience the same loss of consumer surplus. Chapter 10 1. 2. In a market economy, government intervention a. will always improve market outcomes. b. reduces efficiency in the presence of externalities. c. may improve market outcomes in the presence of externalities. d. is necessary to control individual greed. In the absence of externalities, the "invisible hand" leads a market to maximize a. producer profit from that market. b. total benefit to society from that market. c. both equality and efficiency in that market. d. output of goods or services in that market. 3. The term market failure refers to a. a market that fails to allocate resources efficiently. b. an unsuccessful advertising campaign which reduces demand. c. ruthless competition among firms. d. a firm that is forced out of business because of losses. 4. Market failure can be caused by a. too much competition. b. externalities. c. low consumer demand. d. scarcity. 5. An externality is an example of a. a corrective tax. b. a tradable pollution permit. c. a market failure. d. Both a and b are correct. 6. An externality is the impact of a. society's decisions on the well-being of society. b. a person's actions on that person's well-being. c. one per...
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This note was uploaded on 01/27/2014 for the course ECON 1010 taught by Professor Jonathanpritchett during the Fall '12 term at Tulane.

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