ECO 365T Wk 2 – Apply Quiz

1.

Charlie is willing to pay $16 for a T-shirt that is priced at $12. If Charlie buys the T-shirt, then his consumer surplus is

2.

Assume that there are four consumers A, B, C, and D, and the prices that each of them is willing to pay for a glass of lemonade is, respectively, $2.50, $2.25, $2.00, and $1.75. If the actual price of lemonade is $1.25 per glass, then consumer surplus in this market will be

3.

In the following question you are asked to determine, other things equal, the effects of a given change in a determinant of demand or supply for product X upon (1) the demand (D) for, or supply (S) of, X; (2) the equilibrium price (P) of X; and (3) the equilibrium quantity (Q) of X.

Consumer expectations that the price of X will fall soon will

Amanda buys a ruby for $330 for which she was willing to pay $340. The minimum acceptable price to the seller, Tony, was $190. Amanda experiences

5.

In the market for a particular pair of shoes, Geri is willing to pay $75 for a pair, while Jane is willing to pay $85 for a pair. The actual price that each has to pay for a pair of these shoes is $65. What is the total amount of the two women’s combined consumer surplus?

6.

Refer to the table. If demand is represented by columns (3) and (1) and supply is represented by columns (3) and (4), equilibrium price and quantity will be

7.

Jennifer buys a piece of costume jewelry for $30, for which she was willing to pay $35. The minimum acceptable price to the seller, Nathan, was $15. Jennifer experiences a

8.

Refer to the above table. Equilibrium will occur when the price is

9.

Refer to the above diagram for the milk market. If the price were $2.00 per gallon, then there would be

10.

Answer the question based on the given supply and demand data for wheat.

Equilibrium price in this market is

The minimum acceptable price for a product that producer Sam is willing to receive is 10. The price he could get for the product in the market is 15. How much is Sam’s producer surplus?

12.

Refer to the provided table. What is the total producer surplus in the market for all producers A, B, C, D, and E?

13.

Which of the following statements is correct?

If supply decreases and demand decreases, equilibrium price is indeterminate.

If supply decreases and demand decreases, equilibrium price will rise.

If supply decreases and demand decreases, equilibrium price will fall.

If supply decreases and demand decreases, equilibrium quantity will rise.

If supply decreases and demand remains constant, equilibrium price is indeterminate.

Suppose product X is an input in the production of product Y. Product Y in turn is a substitute for product Z. A decrease in the price of X can be expected to

decrease the demand for Z.

increase the demand for Z.

have no effect on the demand of product Z.

decrease the supply of Z.

increase the supply of Z.

15.

Refer to the provided table. The surplus for Producer B is

16.

In the following question you are asked to determine, other things equal, the effects of a given change in a determinant of demand or supply for product X upon (1) the demand (D) for, or supply (S) of, X; (2) the equilibrium price (P) of X; and (3) the equilibrium quantity (Q) of X.

Removing the subsidy placed on product X years ago will