Question : 4.1   Consumer Surplus and Producer Surplus 1) The difference between the : 1388164

4.1   Consumer Surplus and Producer Surplus

1) The difference between the ________ for a good and the ________ is called consumer surplus.

A) highest price a consumer is willing to pay; lowest price a consumer is willing to pay

B) lowest price a consumer is willing to pay; price the consumer actually pays

C) highest price a consumer is willing to pay; price the consumer actually pays

D) price the consumer actually pays; actual cost to the producer

2) In cities with rent control, people have an incentive to list their apartments on sites such as Airbnb at rents ________ the controlled rates, because rent control causes a ________ of apartments.

A) above; surplus

B) above; shortage

C) below; surplus

D) below; shortage

3) Suppose there are two cities that have rent controlled apartments.  In one city (Albany) all apartments are subject to rent control; in the other city (Halftrack) one-half of the apartments are rent controlled.  Which of the following is most likely to be true? 

A) It will be difficult to find a rent-controlled apartment in Albany or Halftrack; rents for the Halftrack apartments not subject to controls will be higher than they would be without rent control.

B) It will be easier to find an affordable apartment in Albany since rents will be low across the board. 

C) It will be easier to find an affordable apartment in Halftrack, either a rent-controlled apartment or another apartment, at a reasonable price.

D) It will be impossible to rent an apartment in either city at any price.

4) Juanita goes to the Hardware Emporium to buy a new circular saw.  She is willing to pay $120 for a new saw, but buys one on sale for $85.  Juanita’s consumer surplus from the purchase is

A) $35.

B) $85.

C) $120.

D) $205.

5) Marco goes to the pet store to buy a dozen Koi fish for his new Koi pond.  He is willing to pay $200 for the dozen fish, but buys them for a total of $140.  Marco’s consumer surplus from the purchase is

A) $5.

B) $60.

C) $140.

D) $200.

6) Brett buys a new cell phone for $100.  He receives consumer surplus of $80 from the purchase.  How much does Brett value his cell phone?

A) $180

B) $100

C) $80

D) $20

7) Monique buys a new television for $795.  She receives consumer surplus of $355 from the purchase.  How much does Monique value her television?

A) $355

B) $440

C) $795

D) $1150

8) The maximum price that a buyer is willing to pay for a good measures his

A) consumer surplus.

B) marginal benefit.

C) willingness to pay.

D) producer surplus.

9) A consumer is willing to purchase a product up to the point where

A) he spends all of his income.

B) the marginal benefit is equal to the price of the product.

C) the quantity demanded is equal to the quantity supplied.

D) he is indifferent between consuming and saving.

10) The additional benefit to a consumer from consuming one more unit of a good or service

A) is equal to consumer surplus.

B) is equal to the opportunity cost of consuming the good or service.

C) is equal to marginal benefit.

D) is equal to economic surplus.