The figure illustrates the market for haircuts. Curve A is the _______ curve, and curve B is the _______ curve.

marginal cost; marginal benefit
opportunity cost; opportunity benefit
total cost; total benefit
marginal benefit; marginal cost

When 2,000 hamburgers per day are produced, the marginal benefit is £1.50 and the marginal cost is £1.00. And when 7,500 hamburgers per day are produced, marginal benefit is £1.00 and marginal cost is £1.50. The efficient production quantity of hamburgers is ________________ a day.

between 2,000 and 7,500
7,500
2,000
more than 7,500

If the marginal benefit from a loaf of bread exceeds the marginal cost of producing a loaf of bread, then the resources will be used more efficiently if _____________ bread is produced and ______________ other goods are produced.

more; fewer
more; more
less; fewer
less; more

In the market for CDs, 500 CDs a month are available. The value people place on the 500th CD a month exceeds the opportunity cost of producing it. Resource use _______________.

is inefficient
would be more efficient if people would value CDs more
is efficient
would be more efficient if people would buy more CDs

Adam makes £25,000 per year and Bob makes £45,000 a year, and they both have the same marginal benefit curve. According to the utilitarian view, if a pound is transferred from Bob to Adam, then _______________ marginal benefit ____________________.

Adam's; increases by more than Bob's marginal benefit decreases
the change in Adam's; plus the change in Bob's marginal benefit is negative
the change in Adam's; plus the change in Bob's marginal benefit equals zero
Adam's; decreases by more than Bob's marginal benefit increases

The figure tells us about the market for red roses. The consumer surplus is ________________ a day.

£200
£800
£20
£1,000

The figure tells us about the market for red roses. On Valentines day, the demand for red roses doubles. If florists increase the price to £30 a dozen, consumer surplus ________________.

might increase or decrease
doubles
halves
decreases to zero

The figure illustrates the market for hamburgers on Big Foot Island. The producer surplus is __________.

£1.20 per hamburger
£240 an hour
£180 an hour
£60 an hour

If the marginal cost of producing a service increases, then the efficient quantity to produce _______.

increases
depends on the marginal benefit
remains the same
decreases

In the competitive market for balloon rides, marginal cost equals marginal benefit when 3,000 balloon rides a day are taken and the price of a ride is £100. Which of the following statements is true?

Too many rides are available.
There is a free-ride problem.
Too few rides are available.
Deadweight loss is zero.

Please enter your name and press the SEND button