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Question : 4.1   Consumer Surplus and Producer Surplus 1) The difference between the : 1387425

Economics

 

4.1   Consumer Surplus and Producer Surplus

 

1) The difference between the highest price a consumer is willing to pay for a good and the price the consumer actually pays is called

A) producer surplus.

B) the substitution effect.

C) the income effect.

D) consumer surplus.

 

 

2) In New York City, about 1 million apartments are subject to rent control by the local government. Rent control

A) puts a legal limit on the rent that landlords can charge for an apartment.

B) is a price floor which sets a minimum rent for apartments.

C) only applies to those apartments which are owned and rented out by the local government.

D) is a government policy which limits apartment rental to those people whose incomes are less than $50,000 per year.

 

 

3) In a city with rent-controlled apartments, all of the following are true except

A) apartments usually rent for rates lower than the market rate.

B) apartments are often in shorter supply than they would be without rent control.

C) it usually takes more time to find an apartment than it would without rent control.

D) landlords have an incentive to rent more apartments than they would without rent control.

 

4) Paul goes to Sportsmart to buy a new tennis racquet. He is willing to pay $200 for a new racquet, but buys one on sale for $125. Paul’s consumer surplus from the purchase is

A) $325.

B) $200.

C) $125.

D) $75.

 

 

5) Frieda is at her local florist to buy a dozen roses. She is willing to pay $75 for the roses, and buys them for $75. Frieda’s consumer surplus from the purchase is

A) $150.

B) $75.

C) $37.50.

D) $0.

 

 

6) Lucinda buys a new GPS system for $250. She receives consumer surplus of $75 from the purchase. How much does Lucinda value her GPS system?

A) $75

B) $175

C) $250

D) $325

 

 

7) Arthur buys a new cell phone for $150. He receives consumer surplus of $150 from the purchase. How much does Arthur value his cell phone?

A) $0

B) $150

C) $225

D) $300

 

8) Willingness to pay measures

A) the maximum price a buyer is willing to pay for a product minus the amount the buyer actually pays for it.

B) the amount a seller actually receives for a good minus the minimum amount the seller is willing to accept for the good.

C) the maximum price that a buyer is willing to pay for a good.

D) the maximum price a buyer is willing to pay minus the minimum price a seller is willing to accept.

 

 

9) Consumers are willing to purchase a product up to the point where

A) the marginal benefit of consuming the product is equal to the marginal cost of consuming it.

B) the consumer surplus is equal to the producer surplus.

C) the marginal benefit of consuming the product equals the area below the supply curve and above the market price.

D) the marginal benefit of consuming a product is equal to its price.

 

 

10) Marginal benefit is equal to the ________ benefit to a consumer receives from consuming one more unit of a good or service

A) total

B) unintended

C) additional

D) surplus

 

 

 

 

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July 1, 2023
    

 

120.Swisher, Incorporated reports the following annual cost data for its single product: 

Normal production level30,000 units

Direct materials$6.40 per unit

Direct labor$3.93 per unit

Variable overhead$5.80 per unit

Fixed overhead$150,000 in total

This product is normally sold for $48 per unit. If Swisher increases its production to 50,000 units, while sales remain at the current 30,000 unit level, by how much would the company's gross margin increase or decrease under absorption costing?    

A. $60,000 decrease.

B. $90,000 decrease.

C. There is no change in gross margin.

D. $90,000 increase.

E. $60,000 increase.

121.Swisher, Incorporated reports the following annual cost data for its single product: 

Normal production level30,000 units

Direct materials$6.40 per unit

Direct labor$3.93 per unit

Variable overhead$5.80 per unit

Fixed overhead$150,000 in total

This product is normally sold for $48 per unit. If Swisher increases its production to 50,000 units, while sales remain at the current 30,000 unit level, by how much would the company's gross margin increase or decrease under variable costing?  A. $60,000 decrease.

B. $90,000 decrease.

C. There is no change in gross margin.

D. $90,000 increase.

E. $60,000 increase.

122.Swola Company reports the following annual cost data for its single product. 

Normal production level75,000 units

Direct materials$1.25 per unit

Direct labor$2.50 per unit

Variable overhead$3.75 per unit

Fixed overhead$300,000 in total

This product is normally sold for $25 per unit. If Swola increases its production to 200,000 units, while sales remain at the current 75,000 unit level, by how much would the company's gross marginA.               $187,500 increase.

B. $112,500 increase.

C. There will be no change in gross margin.

D. $112,500 decrease.

E. $187,500 decrease.

123.Swola Company reports the following annual cost data for its single product. 

Normal production level75,000 units

Direct materials$1.25 per unit

Direct labor$2.50 per unit

Variable overhead$3.75 per unit

Fixed overhead$300,000 in total

This product is normally sold for $25 per unit. If Swola increases its production to 200,000 units, while sales remain at the current 75,000 unit level, by how much would the company's gross margin increase or decrease under variable costing?    

A. $187,500 increase.

B. $112,500 increase.

C. There will be no change in gross margin.

D. $112,500 decrease.

E. $187,500 decrease.

124.What is the Red and White's contribution margin for this month if 980 units were sold?    

A. $38,000

B. $18,620

C. $24,500

D. $50,000

E. $21,560

125.What is Red and White's net income under absorption costing if 980 units are sold and operating expenses are $12,000?    

A. ($1,380)

B. ($2,000)

C. $2,700

D. $6,620

E. $10,620

126.What is Red and White's net income under variable costing if 980 units are sold and operating expenses are $12,000?    

A. ($1,380)

B. ($2,000)

C. $2,700

D. $6,620

E. $10,620

127.Decko Industries reported the following monthly data: 

Units produced52,000 units

Sales price$33 per unit

Direct materials$1.50 per unit

Direct labor$2.50 per unit

Variable overhead$3.50 per unit

Fixed overhead$234,000 in total

What is the company's contribution margin for this month if 50,000 units were sold?    

A. $1,326,000

 

B. $1,716,000

 

C. $1,275,000

 

D. $1,650,000

E. $1,450,000

128.Assume that the following information was available for Guy Brown Company. How would Maria Teresa Vazquez and the other owners evaluate this information based on contribution margin ratio? 

Recycled Toner CartridgesOffice SuppliesFurniture

Sales$500,000$700,000$900,000

Variable expenses

Variable production$50,000$140,000$270,000

Variable advertising$5,000$14,000$36,000

Variable shipping$10,000$28,000$72,000

  

A. Recycled toner cartridges has the lowest contribution margin ratio.

B. Furniture has the highest contribution margin ratio.

C. Office supplies has the highest contribution margin ratio.

D. Recycled toner cartridges has the highest contribution margin ratio.

E. Based on contribution margin ratio, the owners should consider expanding the furniture line and scaling back on office supplies and recycled toner cartridges.

129.Assume that the following information was available for Daylight Enterprises, Inc. Which of the following statements is(are) true with regard to contribution margin ratio? 

Ceiling LightsTabletop LightsStand-Alone Lights

Sales$350,000$175,000$440,000

Variable expenses

Variable production$70,000$19,250$90,000

Variable advertising$10,500$3,500$22,000

Variable shipping $12,000   $14,000   $28,000

  

A. Tabletop lights has the lowest contribution margin ratio.

 

B. Ceiling lights has the highest contribution margin ratio.

C. Ceiling lights has the lowest contribution margin ratio.

D. Stand-alone lights has the highest contribution margin ratio.

E. Tabletop lights has the highest contribution margin ratio.

 

 

default image
July 1, 2023
    

 

120.Swisher, Incorporated reports the following annual cost data for its single product: 

Normal production level30,000 units

Direct materials$6.40 per unit

Direct labor$3.93 per unit

Variable overhead$5.80 per unit

Fixed overhead$150,000 in total

This product is normally sold for $48 per unit. If Swisher increases its production to 50,000 units, while sales remain at the current 30,000 unit level, by how much would the company's gross margin increase or decrease under absorption costing?    

A. $60,000 decrease.

B. $90,000 decrease.

C. There is no change in gross margin.

D. $90,000 increase.

E. $60,000 increase.

121.Swisher, Incorporated reports the following annual cost data for its single product: 

Normal production level30,000 units

Direct materials$6.40 per unit

Direct labor$3.93 per unit

Variable overhead$5.80 per unit

Fixed overhead$150,000 in total

This product is normally sold for $48 per unit. If Swisher increases its production to 50,000 units, while sales remain at the current 30,000 unit level, by how much would the company's gross margin increase or decrease under variable costing?  A. $60,000 decrease.

B. $90,000 decrease.

C. There is no change in gross margin.

D. $90,000 increase.

E. $60,000 increase.

122.Swola Company reports the following annual cost data for its single product. 

Normal production level75,000 units

Direct materials$1.25 per unit

Direct labor$2.50 per unit

Variable overhead$3.75 per unit

Fixed overhead$300,000 in total

This product is normally sold for $25 per unit. If Swola increases its production to 200,000 units, while sales remain at the current 75,000 unit level, by how much would the company's gross marginA.               $187,500 increase.

B. $112,500 increase.

C. There will be no change in gross margin.

D. $112,500 decrease.

E. $187,500 decrease.

123.Swola Company reports the following annual cost data for its single product. 

Normal production level75,000 units

Direct materials$1.25 per unit

Direct labor$2.50 per unit

Variable overhead$3.75 per unit

Fixed overhead$300,000 in total

This product is normally sold for $25 per unit. If Swola increases its production to 200,000 units, while sales remain at the current 75,000 unit level, by how much would the company's gross margin increase or decrease under variable costing?    

A. $187,500 increase.

B. $112,500 increase.

C. There will be no change in gross margin.

D. $112,500 decrease.

E. $187,500 decrease.

124.What is the Red and White's contribution margin for this month if 980 units were sold?    

A. $38,000

B. $18,620

C. $24,500

D. $50,000

E. $21,560

125.What is Red and White's net income under absorption costing if 980 units are sold and operating expenses are $12,000?    

A. ($1,380)

B. ($2,000)

C. $2,700

D. $6,620

E. $10,620

126.What is Red and White's net income under variable costing if 980 units are sold and operating expenses are $12,000?    

A. ($1,380)

B. ($2,000)

C. $2,700

D. $6,620

E. $10,620

127.Decko Industries reported the following monthly data: 

Units produced52,000 units

Sales price$33 per unit

Direct materials$1.50 per unit

Direct labor$2.50 per unit

Variable overhead$3.50 per unit

Fixed overhead$234,000 in total

What is the company's contribution margin for this month if 50,000 units were sold?    

A. $1,326,000

 

B. $1,716,000

 

C. $1,275,000

 

D. $1,650,000

E. $1,450,000

128.Assume that the following information was available for Guy Brown Company. How would Maria Teresa Vazquez and the other owners evaluate this information based on contribution margin ratio? 

Recycled Toner CartridgesOffice SuppliesFurniture

Sales$500,000$700,000$900,000

Variable expenses

Variable production$50,000$140,000$270,000

Variable advertising$5,000$14,000$36,000

Variable shipping$10,000$28,000$72,000

  

A. Recycled toner cartridges has the lowest contribution margin ratio.

B. Furniture has the highest contribution margin ratio.

C. Office supplies has the highest contribution margin ratio.

D. Recycled toner cartridges has the highest contribution margin ratio.

E. Based on contribution margin ratio, the owners should consider expanding the furniture line and scaling back on office supplies and recycled toner cartridges.

129.Assume that the following information was available for Daylight Enterprises, Inc. Which of the following statements is(are) true with regard to contribution margin ratio? 

Ceiling LightsTabletop LightsStand-Alone Lights

Sales$350,000$175,000$440,000

Variable expenses

Variable production$70,000$19,250$90,000

Variable advertising$10,500$3,500$22,000

Variable shipping $12,000   $14,000   $28,000

  

A. Tabletop lights has the lowest contribution margin ratio.

 

B. Ceiling lights has the highest contribution margin ratio.

C. Ceiling lights has the lowest contribution margin ratio.

D. Stand-alone lights has the highest contribution margin ratio.

E. Tabletop lights has the highest contribution margin ratio.

 

 

default image
July 1, 2023
    

 

120.Swisher, Incorporated reports the following annual cost data for its single product: 

Normal production level30,000 units

Direct materials$6.40 per unit

Direct labor$3.93 per unit

Variable overhead$5.80 per unit

Fixed overhead$150,000 in total

This product is normally sold for $48 per unit. If Swisher increases its production to 50,000 units, while sales remain at the current 30,000 unit level, by how much would the company's gross margin increase or decrease under absorption costing?    

A. $60,000 decrease.

B. $90,000 decrease.

C. There is no change in gross margin.

D. $90,000 increase.

E. $60,000 increase.

121.Swisher, Incorporated reports the following annual cost data for its single product: 

Normal production level30,000 units

Direct materials$6.40 per unit

Direct labor$3.93 per unit

Variable overhead$5.80 per unit

Fixed overhead$150,000 in total

This product is normally sold for $48 per unit. If Swisher increases its production to 50,000 units, while sales remain at the current 30,000 unit level, by how much would the company's gross margin increase or decrease under variable costing?  A. $60,000 decrease.

B. $90,000 decrease.

C. There is no change in gross margin.

D. $90,000 increase.

E. $60,000 increase.

122.Swola Company reports the following annual cost data for its single product. 

Normal production level75,000 units

Direct materials$1.25 per unit

Direct labor$2.50 per unit

Variable overhead$3.75 per unit

Fixed overhead$300,000 in total

This product is normally sold for $25 per unit. If Swola increases its production to 200,000 units, while sales remain at the current 75,000 unit level, by how much would the company's gross marginA.               $187,500 increase.

B. $112,500 increase.

C. There will be no change in gross margin.

D. $112,500 decrease.

E. $187,500 decrease.

123.Swola Company reports the following annual cost data for its single product. 

Normal production level75,000 units

Direct materials$1.25 per unit

Direct labor$2.50 per unit

Variable overhead$3.75 per unit

Fixed overhead$300,000 in total

This product is normally sold for $25 per unit. If Swola increases its production to 200,000 units, while sales remain at the current 75,000 unit level, by how much would the company's gross margin increase or decrease under variable costing?    

A. $187,500 increase.

B. $112,500 increase.

C. There will be no change in gross margin.

D. $112,500 decrease.

E. $187,500 decrease.

124.What is the Red and White's contribution margin for this month if 980 units were sold?    

A. $38,000

B. $18,620

C. $24,500

D. $50,000

E. $21,560

125.What is Red and White's net income under absorption costing if 980 units are sold and operating expenses are $12,000?    

A. ($1,380)

B. ($2,000)

C. $2,700

D. $6,620

E. $10,620

126.What is Red and White's net income under variable costing if 980 units are sold and operating expenses are $12,000?    

A. ($1,380)

B. ($2,000)

C. $2,700

D. $6,620

E. $10,620

127.Decko Industries reported the following monthly data: 

Units produced52,000 units

Sales price$33 per unit

Direct materials$1.50 per unit

Direct labor$2.50 per unit

Variable overhead$3.50 per unit

Fixed overhead$234,000 in total

What is the company's contribution margin for this month if 50,000 units were sold?    

A. $1,326,000

 

B. $1,716,000

 

C. $1,275,000

 

D. $1,650,000

E. $1,450,000

128.Assume that the following information was available for Guy Brown Company. How would Maria Teresa Vazquez and the other owners evaluate this information based on contribution margin ratio? 

Recycled Toner CartridgesOffice SuppliesFurniture

Sales$500,000$700,000$900,000

Variable expenses

Variable production$50,000$140,000$270,000

Variable advertising$5,000$14,000$36,000

Variable shipping$10,000$28,000$72,000

  

A. Recycled toner cartridges has the lowest contribution margin ratio.

B. Furniture has the highest contribution margin ratio.

C. Office supplies has the highest contribution margin ratio.

D. Recycled toner cartridges has the highest contribution margin ratio.

E. Based on contribution margin ratio, the owners should consider expanding the furniture line and scaling back on office supplies and recycled toner cartridges.

129.Assume that the following information was available for Daylight Enterprises, Inc. Which of the following statements is(are) true with regard to contribution margin ratio? 

Ceiling LightsTabletop LightsStand-Alone Lights

Sales$350,000$175,000$440,000

Variable expenses

Variable production$70,000$19,250$90,000

Variable advertising$10,500$3,500$22,000

Variable shipping $12,000   $14,000   $28,000

  

A. Tabletop lights has the lowest contribution margin ratio.

 

B. Ceiling lights has the highest contribution margin ratio.

C. Ceiling lights has the lowest contribution margin ratio.

D. Stand-alone lights has the highest contribution margin ratio.

E. Tabletop lights has the highest contribution margin ratio.

 

 

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Our guarantees

Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

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Zero-plagiarism guarantee

Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.

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Free-revision policy

Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.

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Privacy policy

Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.

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Fair-cooperation guarantee

By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.

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