Question :
Figure 4-4
21) Refer to Figure 4-4. The figure above : 1388174
Figure 4-4
21) Refer to Figure 4-4. The figure above represents the market for iced tea. Assume that this is a competitive market. If the price of iced tea is $3, what changes in the market would result in an economically efficient output?
A) The price would decrease, the quantity supplied would increase, and the quantity demanded would decrease.
B) The quantity supplied would decrease, the quantity demanded would increase and the equilibrium price would decrease.
C) The price would decrease, the demand would increase and the supply would decrease.
D) The price would decrease, quantity demanded would increase and quantity supplied would decrease.
22) Refer to Figure 4-4. The figure above represents the market for iced tea. Assume that this is a competitive market. If the price of iced tea is $1, what changes in the market would result in an economically efficient output?
A) The price would increase, the quantity supplied would increase, and the quantity demanded would decrease.
B) The quantity supplied would increase, the quantity demanded would decrease and the equilibrium price would increase.
C) The price would increase, the demand would increase and the supply would decrease.
D) The price would increase, quantity demanded would increase and quantity supplied would decrease.
23) Refer to Figure 4-4. The figure above represents the market for iced tea. Assume that this is a competitive market. If 20,000 units of iced tea are sold
A) the deadweight loss is equal to economic surplus.
B) producer surplus equals consumer surplus.
C) the marginal benefit of each of the 20,000 units of iced tea equals $3.
D) marginal benefit is equal to marginal cost.
24) Refer to Figure 4-4. The figure above represents the market for iced tea. Assume that this is a competitive market. If 10,000 units of iced tea are sold
A) the deadweight loss is equal to economic surplus.
B) producer surplus equals consumer surplus.
C) the marginal benefit of each of the 10,000 units of iced tea equals $3.
D) marginal benefit is less than marginal cost.
25) Refer to Figure 4-4. The figure above represents the market for iced tea. Assume that this is a competitive market. Which of the following is true?
A) If the price of iced tea is $3 the output will be economically efficient but there will be a deadweight loss.
B) If the price of iced tea is $3 consumers will purchase more than the economically efficient output.
C) Both 10,000 and 30,000 are economically inefficient rates of output.
D) If the price of iced tea is $3 producers will sell 30,000 units of iced tea but this output will be economically inefficient.
26) In a competitive market when there is no deadweight loss,
A) consumer surplus is minimized.
B) producer surplus is minimized.
C) consumer surplus plus producer surplus is minimized.
D) consumer surplus plus producer surplus is maximized.
27) Economic efficiency is achieved when there is a market outcome in which the marginal benefit to consumers of the last unit produced is equal to its marginal cost of production and
A) economic surplus plus consumer surplus equals producer surplus.
B) consumer surplus plus producer surplus is maximized.
C) economic surplus is minimized.
D) the difference between consumer surplus and producer surplus is maximized.
28) There will be no deadweight loss if the marginal benefit to consumers is equal to the marginal cost of production and the sum of consumer surplus and producer surplus is maximized.
29) If marginal benefit is less than marginal cost, output is inefficiently high.
30) The difference between consumer surplus and producer surplus in a market is equal to the deadweight loss.
