Foundations of Economics (8th Edition)
8th Edition
ISBN: 9780134486819
Author: Robin Bade, Michael Parkin
Publisher: PEARSON
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Question
Chapter 7, Problem 8MCQ
To determine
To choose: The appropriate option to fill in the blanks in the given statement.
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Market for Game Consoles
600
Tools
550
500
CS
PS
450
400
350
ESeq
300
250
200
150
100
50
D
10 20 30 40 50 60 70 80 90 100110
Quantity
a. What is the quantity demanded at $150 per game console?
Quantity demanded:
20 game consoles
b. What is the quantity supplied at $150 per game console?
Quantity supplied:|
80 game consoles
c. What is the consumer surplus generated at a price of $150 per game console?
Instructions: Use the tool provided "CS" to illustrate this area on the graph.
Consumer surplus: $
30000
d. What is the producer surplus generated at a price of $150 per game console?
Instructions: Use the tool provided “PS" to illustrate this area on the graph.
Producer surplus: $
3750
e. What is total economic surplus at a price of $150 per game console?
Economic surplus: $
33750
f. What is the economic surplus generated if the market were in equilibrium?
Instructions: Use the tool provided “ESeg" to illustrate this area on the graph.
Economic surplus in equilibrium: $
56250
Price…
The demand and supply schedule for coffee are:
Price ($ per cup)
Quantity Demanded
Quantity
Supplied
$1
130
10
$2
110
20
$3
90
30
$4
70
40
$5
50
50
$6
30
60
$7
10
70
$8
0
80
a) If there is no tax on coffee, what is the price and how much coffee is consumed
b) What is the consumer surplus? Show your calculations
c) What is the price elasticity of demand when the price goes up from $3 to $4 dollars? Is the demand for coffee elastic or inelastic? Explain.
. Which statement best explains how a price ceiling affects the market for gasoline?
It can cause more gasoline producers to enter the market.
It can lead to producers increasing their production costs for gasoline.
It can cause shortages in the supply of gasoline.
It can lead to a decrease in the demand from consumers for gasoline.
Chapter 7 Solutions
Foundations of Economics (8th Edition)
Ch. 7 - Prob. 1SPPACh. 7 - Prob. 2SPPACh. 7 - Prob. 3SPPACh. 7 - Prob. 4SPPACh. 7 - Prob. 5SPPACh. 7 - Prob. 6SPPACh. 7 - Prob. 7SPPACh. 7 - Prob. 8SPPACh. 7 - Prob. 9SPPACh. 7 - Prob. 10SPPA
Ch. 7 - Prob. 11SPPACh. 7 - Prob. 1IAPACh. 7 - Prob. 2IAPACh. 7 - Prob. 3IAPACh. 7 - Prob. 4IAPACh. 7 - Prob. 5IAPACh. 7 - Prob. 6IAPACh. 7 - Prob. 7IAPACh. 7 - Prob. 8IAPACh. 7 - Prob. 9IAPACh. 7 - Prob. 1MCQCh. 7 - Prob. 2MCQCh. 7 - Prob. 3MCQCh. 7 - Prob. 4MCQCh. 7 - Prob. 5MCQCh. 7 - Prob. 6MCQCh. 7 - Prob. 7MCQCh. 7 - Prob. 8MCQ
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- A. What effect will each of the following have on the demand for product B? 1. Product B becomes more fashionable. 2. The price of substitute product C falls. 3. A decline in incomes if B is an inferior product. 4. Consumers anticipate the price of B will be lower in the near future. 5. The price of complementary product D falls. 6. Foreign tariff barriers on B are eliminated. B. What effect will each of the following have on the supply for product B? 1. A technological advance in the methods of producing B. 2. A decline in the number of firms in industry B. 3. An increase in the price of resources required in the produUction of B. 4. The expectation that the equilibrium price of B will be lower in the future than it is currently. 5. A decline in the price of product A, a good whose production requires substantially the same techniques as does the production of B. 6. The levying of a specific sales tax upon B. 7. The granting of a 50-cent per unit subsidy of B produced.arrow_forwardPrice of Gasoline P3 P₂ P₁ 0 9₂ 9₂ 52 D S₁ Price Ceiling Quantity of Gasoline Refer to the figure above. With a price ceiling present in this market, what will happen when the supply curve for gasoline shifts from S₁ to S₂? The market price will stay at P₁ due to the price ceiling. A shortage will occur at the price ceiling of P2. The price will increase to P3. A surplus will occur at the new market price of P₂.arrow_forwardQ20 In Canada we have government intervention in the dairy market in the form of quotas on milk production. What are two predicted economic effects of this policy? a. A redistribution of income from dairy farmers to consumers of dairy products and an increase in the total amount of economic surplus in the dairy market. b. An equitable distribution of income between dairy farmers and consumers of dairy products and a reduction in the total amount of economic surplus in the dairy market. c. A redistribution of income from consumers of dairy products to dairy farmers and a reduction in deadweight loss in the dairy market. d. A redistribution of income from dairy farmers to consumers of dairy products and a reduction in the total amount of economic surplus in the dairy market. e. A redistribution of income from consumers of dairy products to dairy farmers and a reduction in the total amount of economic surplus in the dairy market. Clear my choicearrow_forward
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