-Practice MCQs for the Midterm for SECTIONS 3
a. is the amount of a good that a consumer can buy at a price below equilibrium price. b. is the difference between the amount that a consumer actually pays for a good and the amount that the consumer is willing to pay for the good.
c. is the number of consumers who are excluded from a market because of scarcity. d. measures how much a buyer values a good.
2).Suppose Bart, Benjamin, and Brent each purchase a particular type of electric pencil sharpener at a price of $20. Bart’s willingness to pay was $22, Benjamin's willingness to pay was $25, and Brent's willingness to pay was $30. Which of the following statements is correct?
a. Had the price of the pencil sharpener been $26 rather than $20, only Brent would have been a buyer. b. Brent’s consumer surplus is the smallest of the three individual consumer surpluses. c. For the three individuals together, consumer surplus amounts to $60. d. The fact that all three individuals paid $20 for the same type of pencil sharpener indicates that each one placed the same value on that pencil sharpener.
3) In a market, the marginal buyer is the buyer
a. whose willingness to pay is higher than that of all other buyers and potential buyers. b. whose willingness to pay is lower than that of all othe r buyers and potential buyers. c. who is willing to buy exactly one unit of the good.
who would be the first to leave the market if the price were any higher.
4) Chad is willing to pay $5.00 to get his first cup of morning latté; he is willing to pay $4.50 for a second cup. He buys his first cup from a vendor selling latté for $3.75 per cup. He returns to that vendor later in the morning to find that the vendor has increased her price to $3.90 per cup. Chad buys a second cup. Which of the following statements is correct?
a. Chad’s willingness to pay for his second cup of latté was smaller than his willingness to pay for his first cup of latté.
b. Chad’s consumer surplus on his second cup of latté was larger than his consumer surplus on his first cup of latté.
c. Chad is irrational in that he is willing to pay a different price for his second cup of latté than what he is willing to pay for his first cup of latté.
d. Chad places a higher value on his second cup of latté than on his first cup of latté.
5) A demand curve reflects each of the following except the
a. willingness to pay of all buyers in the market.
b. value each buyer in the market places on the good.
c. highest price buyers are willing to pay for each quantity. d. ability of buyers to obtain the quantity they desire.
6) For each of three potential buyers of oranges, the table displays the willingness to pay for the first three oranges of the day. Assume Alex, Barb, and Carlos are the only three buyers of oranges, and only three oranges can be supplied per day.
Consult this table for the next 9 questions
7)If the market price of an orange is $1.20, the market quantity of oranges demanded per day is a. 1 .
c. 3 .
8) If the market price of an orange is $0.70, the market quantity of oranges demanded per day is a. 5 .
c. 7 .
9) The market quantity of oranges demanded per day is exactly 5 if the price of an orange, P, satisfies a. $1.00 < P < $1.50.
b. $0.80 < P < $1.50.
c. $0.80 < P < $1.00.
d. $0.75 < P < $0.80.
If the market price of an orange is $1.20, consumer surplus amounts to a. $0.70.
11). If the market price of an orange is $0.40,
a. 6 oranges are demanded per day and total consumer surplus amounts to $4.45. b. 6 oranges are demanded per day and total consumer surplus amounts to $5.10. c. 7...