A market's deadweight loss is calculated as: the economic loss that a firm has when it is not producing its profit-maximizing output. the price at equilibrium minus the price at actual quantity. the loss to consumers when a product malfunctions or fails to meet expectations. the total economic surplus at the efficient quantity minus the total economic surplus at the actual quantity. O ooo
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- Suppose consumer income increases. If grass seed is a normal good, the equilibrium price of grass seed will Select one: O a. decrease, and producer surplus in the industry will decrease. Ob. decrease, and producer surplus in the industry will increase. O c. increase, and producer surplus in the industry will increase. Oc. O d. increase, and producer surplus in the industry will decrease. N eg IMG_7969.jpeg JPEDChoose the best statement O A. Producer surplus is the excess of the value of the good over the market price, summed over the quantity produced OB. If producers decrease the supply of a good, their producer surplus will increase OC. Producer surplus equals the total revenue from selling the good OD. An increase in the demand for a good increases producer surplusProducer surplus is measured using the demand curve for a good. always a negative number for sellers in a competitive market. the amount a seller is paid minus the cost of production. O the opportunity cost of production minus the cost of producing goods that go unsold.
- A rightward shift of the supply curve for oil in the United States is most likely to result from? a) A decrease in the costs of exploration and drilling for oil O b) An increase in the world price of oil c) An increase in the fees that oil companies must pay for drilling licenses d) A decrease in the subsidy for oil exploration and drillingPrice P₂ P₁ A D B E Supply Quantity According to Graph 7-3, area B represents: Select one: O a. producer surplus to new producers entering the market as the result of price rising from P₁ to P₂ O b. the increase in consumer surplus that results from an upward-sloping supply curve O c. a decrease in producer surplus to each producer in the market O d. an increase in total surplus when sellers are willing and able to increase supply from Q₁ to Q₂G Blackboard QUESTION 20 Find Which of the following is Not correct O f the price of K declines, the demand curve for complementary product J shifts to the right O Ceteris paribus, the development of a low-cost electric automobile might shift the demand curve for gasoline to the left O Ceteris paribus, a rise in the price of gasoline might shift the demand curve for gasoline to the left O The law of supply indicates that producers will offer more of a product at high prices than they will at low prices QUESTION 21
- Which one of the following events will make the elasticity of supply for Product A relatively more elastic. O A. Firms supplying Product A currently have a significant amount of spare (excess) capacity. O B. It is very difficult for firms to switch resources from producing other products to producing more of Product A. O C. The production of Product A requires very specialized resources and processes that cannot be used to produce other product O D. Firms must incur a significant amount of additional costs in order to supply more units of Product A.Suppose you are the managing director of a firm that produces two goods: A and B. The priceelasticity of demand for good A is 0.75 and for good B it is 2.5. The firm is experiencing seriouscash flow problems and you have to increase total revenue as soon as possible. If you were ina position to set the price for these two goods, what would be your pricing strategy for eachproduct?QUESTION 1 When production of a good can be expanded without significantly increasing the overall demand for its inputs: O a.supply for this good will tend to be more inelastic. O b.supply for this good will tend to be more elastic. O c. price for the good will be constant. O d. the elasticity of supply of the product will equal the elasticity of supply of the inputs.
- Under autarky, producing goods at a price below the market equilibrium price is O efficient because consumer surplus is maximized. inefficient because producer surplus is smaller than consumer surplus. efficient because total surplus is maximized. O inefficient because there are consumers willing to pay more than the cost of producing the good.Consider the supply curve in the figure at right, where the quantity is in units and the price is in dollars. The price elasticity of supply between points w and y is approximately: OA. 7.14. OB. 14.00. O C. 1.67. O D. 0.71. OE. 1.40. W Quantity Supply USuppose the demand for nachos increases. What will happen to producer surplus in the market for nachos? It increases. O It decreases. O It remains unchanged. O It may increase, decrease, or remain unchanged.