Question 1

The number of seats in a football stadium is fixed at 70,000.The team raises the price of a ticket from
$30, where 70,000 are sold, to $40, and it sells 60,000 tickets.The price change caused a change in the consumer surplus of _.
A.-$10.
B.-$50,000
C.-$100,000
D.-$10,000

Accepted Answer

The answer of The number of seats in a football...

Question 2

Which of the following is true if there is a decrease in the demand for cupcakes?
A.There is an increase in producer surplus.
B.There is an increase in consumer surplus.
C.There is an increase in total surplus.
D.There is a decrease in producer surplus.

Accepted Answer

The answer of Which of the following is true if...

Question 3

Which of the following is true if there is a decrease in the demand for ice cream?
A.There is an increase in producer surplus.
B.There is a decrease in producer surplus.
C.There is no change in producer surplus.
D.It's impossible to tell what will happen to producer surplus.

Accepted Answer

The answer of Which of the following is true if...

Question 4

Along the supply curve for brownies, a decrease in the price of brownies will:
A)increase producer surplus.
B)decrease producer surplus.
C)increase consumer surplus.
D)increase producer surplus and consumer surplus.

Accepted Answer

A decrease in the price of brownies would lead to a decrease in producer surplus as producers would receive less revenue for each unit sold. It would not necessarily lead to an increase in consumer surplus or an overall increase in total surplus.

Question 5

If the price of a good rises, then producer surplus:
A.will increase.
B.will decrease.
C.will remain the same.
D.may change, but we can't tell how.

Accepted Answer

The answer of If the price of a good rises,...

Question 6

Peanut butter and jelly are complements.If there is a decrease in the price of jelly, producer surplus in the peanut butter market:
A.will increase.
B.will decrease.
C.will not change.
D.may change, but it is impossible to tell if it will increase or decrease.

Accepted Answer

The answer of Peanut butter and jelly are complements.If there...

Question 7

Equilibrium in the market for peanut butter is disturbed by an increase in the price of peanuts.Producer surplus in the peanut butter market:
A.will increase.
B.will decrease.
C.will not change.
D.may change, but we cannot determine the change without more information.

Accepted Answer

The answer of Equilibrium in the market for peanut butter...

Question 8

Along a given supply curve, an increase in the price of a good will:
A.increase producer surplus.
B.decrease producer surplus.
C.increase consumer surplus.
D.decrease producer surplus and increase consumer surplus.

Accepted Answer

An increase in the price of a good along a given supply curve will increase the producer surplus. This is because the producer can now charge a higher price for their product, resulting in increased profits. As the price of the good goes up, the quantity supplied will also increase, leading to higher levels of producer surplus.

Question 9

Along a given supply curve, a decrease in price will cause producer surplus to:
A)increase.
B)decrease.
C)stay the same.
D)We cannot determine what producer surplus will do without information about the demand curve.

Accepted Answer

A decrease in price along a given supply curve will reduce producer surplus because producers receive less revenue for the same quantity of goods sold.

Question 10

Along a given supply curve, a decrease in the price of a good will:
A)increase producer surplus.
B)decrease producer surplus.
C)have no effect on producer surplus.
D) It's impossible to tell what will happen to producer surplus.

Accepted Answer

A decrease in the price of a good along a given supply curve will decrease producer surplus because producers receive less revenue for the same quantity of goods sold.

Question 11

Figure: Market for Hamburgers
(Figure: The Market for Hamburgers) Look at the figure The Market for Hamburgers.The figure shows the weekly market for hamburgers in Irvine, Kentucky.If 400 hamburgers are sold, producer surplus will equal:
A.$650.
B.$400.
C.$510.
D.$200.

Accepted Answer

The answer of Figure: Market for Hamburgers
(Figure: The Market for...

Question 12

If the cost to download a song from the Internet falls from $0.99 to $0.50, then we would predict that producer surplus would in the market for MP₃ players.
A)increase
B)decrease
C)not change
D)We cannot determine what producer surplus will do without information about consumer surplus.

Accepted Answer

When the cost to download a song falls, the demand for MP3 players increases, resulting in an increase in producer surplus. As a result, the producer will be able to charge a higher price due to the increase in demand for their product.

Question 13

Mountain River Adventures offers whitewater rafting trips down the Colorado River.It costs the firm
$100 for the first raft trip per day, $120 for the second, $140 for the third, and $160 for the fourth.If the market price for a raft trip was $120 but has now increased to $150, the gain in producer surplus is equal to:
A.$20.
B.$70.
C.$80.
D.$90.

Accepted Answer

The gain in producer surplus is calculated by comparing the additional revenue from the price increase against the cost of additional trips made profitable by the price increase. Initially, at $120, only the first trip is profitable. When the price increases to $150, the second trip also becomes profitable. The gain in producer surplus is the difference in revenue from selling the second trip at the new price ($150) minus its cost ($120), which equals $30, plus the increase in revenue for the first trip, which is the difference between the new price and the old price ($150 - $120 = $30). So, the total gain in producer surplus is $30 (for the second trip) + $30 (increase for the first trip) = $60. However, without considering the costs and revenues for the third and fourth trips, which are not profitable even at the new price, and correcting the calculation mistake, the correct approach is to calculate the gain in producer surplus for the trips that became more profitable due to the price increase. Initially, the mistake in calculation led to an incorrect total. The correct calculation should consider the increase in surplus for each trip that is now profitable or more profitable due to the price increase, taking into account the correct costs and the number of trips now profitable at the new price.

Question 14

Figure: Producer Surplus II
(Figure: Producer Surplus II) Look at the figure Producer Surplus II.At a price of P₁, producer surplus equals the area:
A.LMK.
B.P₁K0.
C.P₂M0.
D.P₂P₁KM.

Accepted Answer

The answer of Figure: Producer Surplus II
(Figure: Producer Surplus II)...

Question 15

When there is a new medical report extolling the health advantages of grapefruit, total producer surplus in the grapefruit market:
A.will increase.
B.will decrease.
C.will remain the same.
D.may change, but we can't tell how.

Accepted Answer

The answer of When there is a new medical report...

Question 16

Figure: Producer Surplus
(Figure: Producer Surplus) Look at the figure Producer Surplus.When the price falls from $45 to $35, producer surplus ________ for a total producer surplus of _.
A.increases by $10; $140
B.decreases by $40; $60
C.increases by $35; $180
D.decreases by $10; $140

Accepted Answer

The answer of Figure: Producer Surplus
(Figure: Producer Surplus) Look at...

Question 17

Figure: Market for Hamburgers
   (Figure: The Market for Hamburgers) Look at the figure The Market for Hamburgers.The figure shows the weekly market for hamburgers in Irvine, Kentucky.If the price of burgers falls from $1.50 to $1.00, there is a loss in producer surplus.How much of the loss accrues because of the change in the quantity supplied? 
A.$50
B.$45
C.$75
D.$90

Accepted Answer

The answer of Figure: Market for Hamburgers
   (Figure:...

Question 18

Figure: Market for Hamburgers
(Figure: The Market for Hamburgers) Look at the figure The Market for Hamburgers.The figure shows the weekly market for hamburgers in Irvine, Kentucky.If the price of a hamburger is $1.00 and 200 hamburgers are supplied, producer surplus will equal:
A.$60.
B.$65.
C.$50.
D.$360.

Accepted Answer

The answer of Figure: Market for Hamburgers
(Figure: The Market for...

Question 19

Figure: Producer Surplus
   (Figure: Producer Surplus) Look at the figure Producer Surplus.Total producer surplus is ________
when the price is $40. 
A.$40
B.$60
C.$80
D.$85

Accepted Answer

The answer of Figure: Producer Surplus
   (Figure: Producer...

Question 20

Figure: Producer Surplus
   (Figure: Producer Surplus) Look at the figure Producer Surplus.When the price rises from $25 to $35, producer surplus ________ for a total producer surplus of _. 
A.increases by $10; $30
B.decreases by $10; $30
C.increases by $30; $60
D.decreases by $35; $100

Accepted Answer

The answer of Figure: Producer Surplus
   (Figure: Producer...

Quiz 4: Consumer and Producer Surplus

The number of seats in a football stadium is fixed at 70,000.The team raises the price of a ticket from $30, where 70,000 are sold, to $40, and it sells 60,000 tickets.The price change caused a change in the consumer surplus of _. A.-$10. B.-$50,000 C.-$100,000 D.-$10,000

Which of the following is true if there is a decrease in the demand for cupcakes? A.There is an increase in producer surplus. B.There is an increase in consumer surplus. C.There is an increase in total surplus. D.There is a decrease in producer surplus.

Which of the following is true if there is a decrease in the demand for ice cream? A.There is an increase in producer surplus. B.There is a decrease in producer surplus. C.There is no change in producer surplus. D.It's impossible to tell what will happen to producer surplus.

Along the supply curve for brownies, a decrease in the price of brownies will:

If the price of a good rises, then producer surplus: A.will increase. B.will decrease. C.will remain the same. D.may change, but we can't tell how.

Peanut butter and jelly are complements.If there is a decrease in the price of jelly, producer surplus in the peanut butter market: A.will increase. B.will decrease. C.will not change. D.may change, but it is impossible to tell if it will increase or decrease.

Equilibrium in the market for peanut butter is disturbed by an increase in the price of peanuts.Producer surplus in the peanut butter market: A.will increase. B.will decrease. C.will not change. D.may change, but we cannot determine the change without more information.

Along a given supply curve, an increase in the price of a good will: A.increase producer surplus. B.decrease producer surplus. C.increase consumer surplus. D.decrease producer surplus and increase consumer surplus.

Along a given supply curve, a decrease in price will cause producer surplus to:

Along a given supply curve, a decrease in the price of a good will:

Figure: Market for Hamburgers (Figure: The Market for Hamburgers) Look at the figure The Market for Hamburgers.The figure shows the weekly market for hamburgers in Irvine, Kentucky.If 400 hamburgers are sold, producer surplus will equal: A.$650. B.$400. C.$510. D.$200.

If the cost to download a song from the Internet falls from $0.99 to $0.50, then we would predict that producer surplus would in the market for MP₃ players.

Figure: Producer Surplus II (Figure: Producer Surplus II) Look at the figure Producer Surplus II.At a price of P₁, producer surplus equals the area: A.LMK. B.P₁K0. C.P₂M0. D.P₂P₁KM.

When there is a new medical report extolling the health advantages of grapefruit, total producer surplus in the grapefruit market: A.will increase. B.will decrease. C.will remain the same. D.may change, but we can't tell how.

Figure: Producer Surplus (Figure: Producer Surplus) Look at the figure Producer Surplus.When the price falls from $45 to $35, producer surplus ________ for a total producer surplus of _. A.increases by $10; $140 B.decreases by $40; $60 C.increases by $35; $180 D.decreases by $10; $140

Figure: Producer Surplus (Figure: Producer Surplus) Look at the figure Producer Surplus.Total producer surplus is ________ when the price is $40. A.$40 B.$60 C.$80 D.$85

Figure: Producer Surplus (Figure: Producer Surplus) Look at the figure Producer Surplus.When the price rises from $25 to $35, producer surplus ________ for a total producer surplus of _. A.increases by $10; $30 B.decreases by $10; $30 C.increases by $30; $60 D.decreases by $35; $100