my answers to econ mid2

my answers to econ mid2 - Chapter 7 1 Welfare economics is...

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Chapter 7 1. Welfare economics is the study of how a. the allocation of resources affects economic well-being. b. a price ceiling compares to a price floor. c. the government helps poor people. d. a consumer’s optimal choice affects her demand curve. 2. Welfare economics is the study of a. taxes and subsidies. b. how technology is best put to use in the production of goods and services. c. government welfare programs for needy people. d. how the allocation of resources affects economic well-being. 3. Welfare economics is the study of a. the well-being of less fortunate people. b. welfare programs in the United States. c. how the allocation of resources affects economic well-being. d. the effect of income redistribution on work effort. 4. The study of how the allocation of resources affects economic well-being is called a. consumer economics. b. macroeconomics. c. willingness-to-pay economics. d. welfare economics. 5. An example of positive analysis is studying a. how market forces produce equilibrium. b. whether equilibrium outcomes are fair. c. whether equilibrium outcomes are socially desirable. d. if income distributions are fair. 6. An example of normative analysis is studying a. how market forces produce equilibrium. b. surpluses and shortages. c. whether equilibrium outcomes are socially desirable. d. income distributions. 7. Which of the Ten Principles of Economics does welfare economics explain more fully? a. The cost of something is what you give up to get it. b. Markets are usually a good way to organize economic activity. c. Trade can make everyone better off. d. A country’s standard of living depends on its ability to produce goods and services. 8. Which of the Ten Principles of Economics does welfare economics explain more fully? a. The cost of something is what you give up to get it.
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b. Rational people think at the margin. c. Markets are usually a good way to organize economic activity. d. People respond to incentives. 9. One of the basic principles of economics is that markets are usually a good way to organize economic activity. This principle is explained by the study of a. factor markets. b. energy markets. c. welfare economics. d. labor economics. Table 7-2 This table refers to five possible buyers' willingness to pay for a case of Vanilla Coke. Buyer Willingness To Pay David $8.50 Laura $7.00 Megan $5.50 Mallory $4.00 Audrey $3.50 10. Refer to Table 7-2 . If the price of Vanilla Coke is $6.90, who will purchase the good? a. all five individuals b. Megan, Mallory and Audrey c. David, Laura and Megan d. David and Laura 11. Refer to Table 7-2 . Which of the following is not true? a. At a price of $9.00, no buyer is willing to purchase Vanilla Coke. b. At a price of $5.50, Megan is indifferent between buying a case of Vanilla Coke and not buying one. c. At a price of $4.00, total consumer surplus in the market will be $9.00.
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my answers to econ mid2 - Chapter 7 1 Welfare economics is...

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