EC 400 - EXAM 1 - UA
The demand schedule for a good
Indicates the quantities of the good that people will buy various prices.
Assume the demand curve for a shampoo is downward sloping. If the price falls from $1.50 t0 $1.25 per
bottle,
A larger quantity of shampoo will be demanded.
Which of the following does the law of demand specifically imply?
If the product increases, quantity demanded will decrease.
The height of the demand curve for a product indicates the
Maximum price consumers are willing to pay for an additional unit of it.
The difference between the amount consumers would be willing to pay and the amount they actually
pay for a good is called
consumer surplus
, Graphically, the area that represents the difference between the market price and the minimum price
required to induce suppliers to produce a good is called
producer surplus
If Mateo is paid $25,000 to sell his crop of tomatoes even though he would have been willing to have
sold the crop for as little as $20,000, this indicates that
Mateo received $5,000 of producer surplus from the transaction.
The following table is a schedule of the supply and demand for coffee (both given in thousands of
pounds per month.)
PPP = Pricer Per Pound
QD = Quantity Demanded
QS = Quantity Supplied
PPP / QD / QS
$6. / 9
$8. / 12
$10. /15
$12. / 18
Refer to the table. The equilibrium market price of coffee would be
$10 per pound
The demand schedule for a good
Indicates the quantities of the good that people will buy various prices.
Assume the demand curve for a shampoo is downward sloping. If the price falls from $1.50 t0 $1.25 per
bottle,
A larger quantity of shampoo will be demanded.
Which of the following does the law of demand specifically imply?
If the product increases, quantity demanded will decrease.
The height of the demand curve for a product indicates the
Maximum price consumers are willing to pay for an additional unit of it.
The difference between the amount consumers would be willing to pay and the amount they actually
pay for a good is called
consumer surplus
, Graphically, the area that represents the difference between the market price and the minimum price
required to induce suppliers to produce a good is called
producer surplus
If Mateo is paid $25,000 to sell his crop of tomatoes even though he would have been willing to have
sold the crop for as little as $20,000, this indicates that
Mateo received $5,000 of producer surplus from the transaction.
The following table is a schedule of the supply and demand for coffee (both given in thousands of
pounds per month.)
PPP = Pricer Per Pound
QD = Quantity Demanded
QS = Quantity Supplied
PPP / QD / QS
$6. / 9
$8. / 12
$10. /15
$12. / 18
Refer to the table. The equilibrium market price of coffee would be
$10 per pound
