Question 1

The government wants to transfer welfare from buyers to sellers by collecting a $1 tax on a good from buyers and subsidizing sellers $1 for each unit of the good sold. This policy will:

Accepted Answer

The answer of The government wants to transfer welfare from...

Question 2

(Figure: Market for Socks I) Refer to Figure: Market for Socks I to answer the following questions.  
a. What is the area of consumer surplus before the increase in supply?
b. What is the area of producer surplus before the increase in supply?
c. What is the area of consumer surplus after the increase in supply?
d. What is the area of producer surplus after the increase in supply?
e. What is the area of the deadweight loss after the increase in supply?

Accepted Answer

The answer of (Figure: Market for Socks I) Refer to...

Question 3

(Figure: Price and Quantity VI) Refer to Figure: Price and Quantity VI to answer the following questions.  
a. What is the level of consumer and producer surplus?
b. If consumers are willing to buy 10 more units of the good at any price, what happens to consumer and producer surplus?

Accepted Answer

The answer of (Figure: Price and Quantity VI) Refer to...

Question 4

Suppose that the demand curve for brown rice is given by 50,000 - 3Q² and supply is P = -10,000 + 3Q². a. Find the equilibrium price and quantity. b. Calculate the consumer surplus at the equilibrium price. c. Calculate the producer surplus at the equilibrium price.

Accepted Answer

The answer of Suppose that the demand curve for brown...

Question 5

In 2007, Hawaii began providing universal health care coverage to all children, but the Hawaiian government ended the program in just 7 months. Government officials claimed that most of the children who received government coverage dropped their private insurance to become eligible for the program. As a government official stated, "People who were already able to afford healthcare began to stop paying for it so they could get it for free." In this example, Hawaii's universal health care coverage caused:

Accepted Answer

The correct answer is A) crowding out. This term refers to a situation where private spending or investment is reduced as a result of increased government spending. In this case, the introduction of universal health care led to individuals who could afford private insurance opting for the free government-provided insurance instead, thereby reducing the demand for private insurance.

Question 6

The demand and supply curves for Fuji apples are given by Q^D = 50 - 6P and Q^S = 4P - 2, where P is price per bag and Q is in thousands of bags. What are consumer surplus and producer surplus at the equilibrium price?

Accepted Answer

To find the equilibrium price, set the demand and supply equations equal to each other: 50 - 6P = 4P - 2. Solving for P gives P = $6.50. To find quantities, substitute P back into either equation, resulting in Q = 29. At equilibrium, consumer surplus (CS) is the area above the price and below the demand curve, calculated as the area of a triangle with base (50 - 6.5) and height 6.5, giving CS = 1/2 * 43.5 * 6.5 = $141.375 or $29,422 when considering thousands. Producer surplus (PS) is the area below the price and above the supply curve, calculated as the area of a triangle with base (6.5 + 2) and height 6.5, giving PS = 1/2 * 8.5 * 6.5 = $27.625 or $44,180 when considering thousands.

Question 7

(Figure: Market For Ammunition I) The deadweight loss following the implementation of the quota of 200 boxes/week is:

Accepted Answer

The answer of (Figure: Market For Ammunition I) The deadweight...

Question 8

(Figure: Market for Good X II) Before the subsidy, sellers receive ____ and after the subsidy, seller receive ____.

Accepted Answer

The answer of (Figure: Market for Good X II) Before...

Question 9

The market for cigars is characterized by Q^D = 10 - 0.25P and Q^S = 0.15P, where P is price per box of cigars and Q measures boxes per hour. a. What is the equilibrium price of cigars? b. Suppose the government taxes sellers $5 per box. What are the after-tax prices that buyers pay and sellers receive? c. Suppose the government taxes buyers rather than sellers $5 per box. What are the after-tax prices that buyers pay and sellers receive?

Accepted Answer

The answer of The market for cigars is characterized by...

Question 10

Assume that the demand for disposable digital cameras is Q^D = 6 - 0.33P. Supply is given as Q^S = 0.67P. The equilibrium price (P_B) and quantity (Q_B) once a tax of $1 per unit is applied will be _____. (Please round your answer to two decimal places.)

Accepted Answer

The answer of Assume that the demand for disposable digital...

Question 11

Suppose that the demand curve for an advanced technology product for businesses is given by P = 10,000 - 4Q³ and supply is P = 2,000 + 4Q³. a. Find the equilibrium price and quantity. b. Calculate consumer surplus at the equilibrium price. c. Calculate producer surplus at the equilibrium price.

Accepted Answer

The answer of Suppose that the demand curve for an...

Question 12

Tavist allergy pills sell for $25 a box. Stefan, Brianna, and Tobias are willing to pay $33, $27, and $19, respectively, for a box of Tavist. What is the total consumer surplus for Stefan, Brianna, and Tobias?

Accepted Answer

The answer of Tavist allergy pills sell for $25 a...

Question 13

(Figure: Price and Quantity II) The outward shift of the supply curve will cause producer surplus to increase from area _____ to area _____.

Accepted Answer

The answer of (Figure: Price and Quantity II) The outward...

Question 14

In a small country, the demand and supply of kidneys are represented by Q^D = 10,000 - 0.25P and Q^S = 0.5P + 4,000. The number of kidneys transplanted at a price floor of $10,000 would be _____.

Accepted Answer

The answer of In a small country, the demand and...

Question 15

The market for plywood (a sheet of wood used in construction) is characterized by the following demand and supply equations: Q^D = 800 - 10P and Q^S = 50P - 1,000, where P is the price per sheet of plywood and Q measures the quantity of plywood. What is the size of the deadweight loss if the government imposes a price ceiling of $25 per sheet of plywood?

Accepted Answer

The price ceiling of $25 results in a shortage because the quantity demanded (Q^D = 800 - 10(25) = 550) exceeds the quantity supplied (Q^S = 50(25) - 1,000 = 250). The deadweight loss is calculated as the area of the triangle formed by the difference in quantities at the equilibrium price and the price ceiling. The equilibrium price is found by setting Q^D = Q^S, which gives P = $30 and Q = 500. The deadweight loss is 0.5 * (500 - 250) * (30 - 25) = $3,750.

Question 16

To calculate consumer surplus:

Accepted Answer

Consumer surplus is calculated by integrating the area under the demand curve and above the equilibrium price, representing the difference between what consumers are willing to pay and what they actually pay.

Question 17

Suppose that the market demand curve for residential water is given by Q^D = 10 - 2.25P and the market supply curve is given by Q^S = -10 + 2.75P where the quantity is measured in millions of gallons per month and the price is in dollars per thousand gallons. Calculate the producer surplus at the equilibrium price.

Accepted Answer

The answer of Suppose that the market demand curve for...

Question 18

(Figure: Market for Asparagus I) Suppose the government mandates a price ceiling of $3 per pound. Producer surplus decreases by:

Accepted Answer

The answer of (Figure: Market for Asparagus I) Suppose the...

Question 19

Suppose the market for soda is represented by the supply and demand equations: Q^S = 35P - 39.75 and Q^D = 10.25 - 5P, where P is price per bottle and Q measures bottles per second. a. What are the values of consumer and producer surplus? b. If the government imposes a $0.50 tax per bottle, what are the values of consumer and producer surplus? c. What is the deadweight loss from the tax? How much revenue does the tax yield?

Accepted Answer

The answer of Suppose the market for soda is represented...

Question 20

(Figure: Market for Tickets II) Before the tax, producer surplus is ____ and after the tax, producer surplus is ____.

Accepted Answer

The answer of (Figure: Market for Tickets II) Before the...

Quiz 3: Using Supply and Demand to Analyze Markets

The government wants to transfer welfare from buyers to sellers by collecting a $1 tax on a good from buyers and subsidizing sellers $1 for each unit of the good sold. This policy will:

(Figure: Price and Quantity VI) Refer to Figure: Price and Quantity VI to answer the following questions. a. What is the level of consumer and producer surplus? b. If consumers are willing to buy 10 more units of the good at any price, what happens to consumer and producer surplus?

Suppose that the demand curve for brown rice is given by 50,000 - 3Q² and supply is P = -10,000 + 3Q². a. Find the equilibrium price and quantity. b. Calculate the consumer surplus at the equilibrium price. c. Calculate the producer surplus at the equilibrium price.

The demand and supply curves for Fuji apples are given by Q^D = 50 - 6P and Q^S = 4P - 2, where P is price per bag and Q is in thousands of bags. What are consumer surplus and producer surplus at the equilibrium price?

(Figure: Market For Ammunition I) The deadweight loss following the implementation of the quota of 200 boxes/week is:

(Figure: Market for Good X II) Before the subsidy, sellers receive and after the subsidy, seller receive .

Assume that the demand for disposable digital cameras is Q^D = 6 - 0.33P. Supply is given as Q^S = 0.67P. The equilibrium price (P_B) and quantity (Q_B) once a tax of $1 per unit is applied will be _____. (Please round your answer to two decimal places.)

Suppose that the demand curve for an advanced technology product for businesses is given by P = 10,000 - 4Q³ and supply is P = 2,000 + 4Q³. a. Find the equilibrium price and quantity. b. Calculate consumer surplus at the equilibrium price. c. Calculate producer surplus at the equilibrium price.

Tavist allergy pills sell for $25 a box. Stefan, Brianna, and Tobias are willing to pay $33, $27, and $19, respectively, for a box of Tavist. What is the total consumer surplus for Stefan, Brianna, and Tobias?

(Figure: Price and Quantity II) The outward shift of the supply curve will cause producer surplus to increase from area _ to area _.

In a small country, the demand and supply of kidneys are represented by Q^D = 10,000 - 0.25P and Q^S = 0.5P + 4,000. The number of kidneys transplanted at a price floor of $10,000 would be _____.

To calculate consumer surplus:

(Figure: Market for Asparagus I) Suppose the government mandates a price ceiling of $3 per pound. Producer surplus decreases by:

(Figure: Market for Tickets II) Before the tax, producer surplus is and after the tax, producer surplus is .

Quiz 3: Using Supply and Demand to Analyze Markets

The government wants to transfer welfare from buyers to sellers by collecting a $1 tax on a good from buyers and subsidizing sellers $1 for each unit of the good sold. This policy will:

(Figure: Price and Quantity VI) Refer to Figure: Price and Quantity VI to answer the following questions. a. What is the level of consumer and producer surplus? b. If consumers are willing to buy 10 more units of the good at any price, what happens to consumer and producer surplus?

Suppose that the demand curve for brown rice is given by 50,000 - 3Q2 and supply is P = -10,000 + 3Q2. a. Find the equilibrium price and quantity. b. Calculate the consumer surplus at the equilibrium price. c. Calculate the producer surplus at the equilibrium price.

The demand and supply curves for Fuji apples are given by QD = 50 - 6P and QS = 4P - 2, where P is price per bag and Q is in thousands of bags. What are consumer surplus and producer surplus at the equilibrium price?

(Figure: Market For Ammunition I) The deadweight loss following the implementation of the quota of 200 boxes/week is:

(Figure: Market for Good X II) Before the subsidy, sellers receive ____ and after the subsidy, seller receive ____.

Assume that the demand for disposable digital cameras is QD = 6 - 0.33P. Supply is given as QS = 0.67P. The equilibrium price (PB) and quantity (QB) once a tax of $1 per unit is applied will be _____. (Please round your answer to two decimal places.)

Suppose that the demand curve for an advanced technology product for businesses is given by P = 10,000 - 4Q3 and supply is P = 2,000 + 4Q3. a. Find the equilibrium price and quantity. b. Calculate consumer surplus at the equilibrium price. c. Calculate producer surplus at the equilibrium price.

Tavist allergy pills sell for $25 a box. Stefan, Brianna, and Tobias are willing to pay $33, $27, and $19, respectively, for a box of Tavist. What is the total consumer surplus for Stefan, Brianna, and Tobias?

(Figure: Price and Quantity II) The outward shift of the supply curve will cause producer surplus to increase from area _____ to area _____.

In a small country, the demand and supply of kidneys are represented by QD = 10,000 - 0.25P and QS = 0.5P + 4,000. The number of kidneys transplanted at a price floor of $10,000 would be _____.

To calculate consumer surplus:

(Figure: Market for Asparagus I) Suppose the government mandates a price ceiling of $3 per pound. Producer surplus decreases by:

(Figure: Market for Tickets II) Before the tax, producer surplus is ____ and after the tax, producer surplus is ____.

Suppose that the demand curve for brown rice is given by 50,000 - 3Q² and supply is P = -10,000 + 3Q². a. Find the equilibrium price and quantity. b. Calculate the consumer surplus at the equilibrium price. c. Calculate the producer surplus at the equilibrium price.

The demand and supply curves for Fuji apples are given by Q^D = 50 - 6P and Q^S = 4P - 2, where P is price per bag and Q is in thousands of bags. What are consumer surplus and producer surplus at the equilibrium price?

(Figure: Market for Good X II) Before the subsidy, sellers receive and after the subsidy, seller receive .

Assume that the demand for disposable digital cameras is Q^D = 6 - 0.33P. Supply is given as Q^S = 0.67P. The equilibrium price (P_B) and quantity (Q_B) once a tax of $1 per unit is applied will be _____. (Please round your answer to two decimal places.)

Suppose that the demand curve for an advanced technology product for businesses is given by P = 10,000 - 4Q³ and supply is P = 2,000 + 4Q³. a. Find the equilibrium price and quantity. b. Calculate consumer surplus at the equilibrium price. c. Calculate producer surplus at the equilibrium price.

(Figure: Price and Quantity II) The outward shift of the supply curve will cause producer surplus to increase from area _ to area _.

In a small country, the demand and supply of kidneys are represented by Q^D = 10,000 - 0.25P and Q^S = 0.5P + 4,000. The number of kidneys transplanted at a price floor of $10,000 would be _____.

(Figure: Market for Tickets II) Before the tax, producer surplus is and after the tax, producer surplus is .