Chapter 7
Choices
1,A situation is efficientif
a,no change can help some people
without hurting others.
b,the gain for some people offsets
the loss for others.
c,the gain for some people more than
offsetsthe loss to others.
d,consumer surplus is maximized.
e,producer surplus is maximized.
2,Assume I bring 30 cookies into a class
with 30 students,Which of the following
situationsis Pareto efficient?
a,I give one cookie to each student.
b,I give all 30 cookies to one student.
c,I divide all of the cookies equally
among the female students.
d,I let the best 15 studentshave 2 cookies
each.
e,all of the above
3,If a market is not in equilibrium,which of
the following is always true?
a,The quantity exchanged is below
equilibrium quantity.
b,The quantity exchanged is above
equilibrium quantity.
c,The price is above the equilibrium price.
d,The price is below the equilibrium price.
e,No transaction can be made that will
benefit both a buyer and seller.
4,Total economic surplus is
a,the sum of all the individualeconomic
surpluses gained by buyers and
sellers in a market.
b,the sum of producer and consumer
surplus in a market.
c,maximized at market equilibrium.
d,a measure that can be used to
determine efficiency.
e,all of the above
5,A price ceiling
a,prevents sellers from charging less than
a certain amount.
b,leads to efficiencyin the market.
c,must be above equilibriumprice to have
an effecton the market.
d,results in a loss in total economic
surplus.
e,all of the above
6,A policy that reduces total economic
surplus
a,changes who gets the largest slice of
the pie.
b,gives everyone a larger slice of the pie.
c,decreases the size of the pie.
d,redistributes a pie of equal size.
e,makes society better off (improves the
taste of the pie).
7,Price subsidies will
a,increase consumer surplus,but not
producer surplus.
b,increase producer surplus,but not
consumer surplus.
c,increase both consumer and producer
surplus.
d,decrease both consumer and producer
surplus.
e,vary in their effect,depending on the
specific market.
8,A price subsidy
a,guarantees that suppliers will receive
at least a specified amount for their
product.
b,guarantees that consumers will pay
at least a specified amount for a product.
c,increases total economic surplus.
d,leads to economic efficiency.
e,creates a shortage in the market.
9,Which policy is most efficientwhen
dealing with overbookedairline
flights?
a,first-come,first-servedpolicy
b,compensationpolicy
c,a price ceiling
d,a price floor
e,random selection
10,If the governmentplaces a tax on
sellers in a market,who will pay
the tax?
a,only sellers
b,more the sellers than buyers
c,buyers and sellers equally
d,only buyers
e,it depends on the situationin the
market
Choices
1,A situation is efficientif
a,no change can help some people
without hurting others.
b,the gain for some people offsets
the loss for others.
c,the gain for some people more than
offsetsthe loss to others.
d,consumer surplus is maximized.
e,producer surplus is maximized.
2,Assume I bring 30 cookies into a class
with 30 students,Which of the following
situationsis Pareto efficient?
a,I give one cookie to each student.
b,I give all 30 cookies to one student.
c,I divide all of the cookies equally
among the female students.
d,I let the best 15 studentshave 2 cookies
each.
e,all of the above
3,If a market is not in equilibrium,which of
the following is always true?
a,The quantity exchanged is below
equilibrium quantity.
b,The quantity exchanged is above
equilibrium quantity.
c,The price is above the equilibrium price.
d,The price is below the equilibrium price.
e,No transaction can be made that will
benefit both a buyer and seller.
4,Total economic surplus is
a,the sum of all the individualeconomic
surpluses gained by buyers and
sellers in a market.
b,the sum of producer and consumer
surplus in a market.
c,maximized at market equilibrium.
d,a measure that can be used to
determine efficiency.
e,all of the above
5,A price ceiling
a,prevents sellers from charging less than
a certain amount.
b,leads to efficiencyin the market.
c,must be above equilibriumprice to have
an effecton the market.
d,results in a loss in total economic
surplus.
e,all of the above
6,A policy that reduces total economic
surplus
a,changes who gets the largest slice of
the pie.
b,gives everyone a larger slice of the pie.
c,decreases the size of the pie.
d,redistributes a pie of equal size.
e,makes society better off (improves the
taste of the pie).
7,Price subsidies will
a,increase consumer surplus,but not
producer surplus.
b,increase producer surplus,but not
consumer surplus.
c,increase both consumer and producer
surplus.
d,decrease both consumer and producer
surplus.
e,vary in their effect,depending on the
specific market.
8,A price subsidy
a,guarantees that suppliers will receive
at least a specified amount for their
product.
b,guarantees that consumers will pay
at least a specified amount for a product.
c,increases total economic surplus.
d,leads to economic efficiency.
e,creates a shortage in the market.
9,Which policy is most efficientwhen
dealing with overbookedairline
flights?
a,first-come,first-servedpolicy
b,compensationpolicy
c,a price ceiling
d,a price floor
e,random selection
10,If the governmentplaces a tax on
sellers in a market,who will pay
the tax?
a,only sellers
b,more the sellers than buyers
c,buyers and sellers equally
d,only buyers
e,it depends on the situationin the
market
