ECON Exam #2

A rough in California destroys many red grapes. As a result of the drought, the consumer surplus in the market for red grapes

Which of the following will cause an increase in consumer surplus?

A supply curve can be used to measure producer surplus because it reflects

A seller's willingness to sell is

Producer surplus is the area

Which of the following will cause an increase in producer surplus?

Suppose consumer income increases, If grass seed is a normal good, the equilibrium price of grass seed will

Which of the following will cause a decrease in producer surplus?

Raisin bran and milk are complementary goods. A decrease in the price of raisins will

If the current allocation of resources in the market for hammers is inefficient, then it must be the case that

Which of the following quantities decrease in response to a tax on a good?

Which of the following statements is correct regarding the imposition of a tax on gasoline?

if a price ceiling is binding then

Suppose the government has imposed a price ceiling on laptop computers. Which of the following events could transform the price ceiling from one that is not binding into one that is binding?

If the government removes a binding price ceiling from a market, then the price paid by buyers will

When a binding price ceiling is imposed on a market to benefit buyers

If the price floor is binding, then

Suppose the government has imposed a price floor on cellular phones. Which of the following events could transform the price floor from one that is binding to one that is not binding?

If the government removes a binding price floor from a market, then the price paid by buyers will

A binding price floor will reduce a firm's total revenue

If the government levies a $1,000 tax per boat on sellers of boats, then the price paid by buyers of boats would

Suppose that the demand for picture frames is highly inelastic, and the supply of picture frames is highly elastic. A tax of $1 per frame levied on picture frames will increase the price paid by buyers of picture frames by

The demand for salt is inelastic, and the supply of salt is elastic. The demand for caviar is elastic, and the supply of caviar is inelastic. Suppose that a tax of $1 per pound is levied on the sellers of salt, and a tax of $1 per pound is levied on the buyers of caviar. We would expect that most of the burden of these taxes will fall on

The nation of Falconia forbids international trade. In Falconia, you can obtain a computer by trading 3 bicycles. In other countries, you can obtain a computer by trading 5 bicycles. These facts indicate that

When a country that imported a particular good abandons a free-trade policy and adopts a no-trade policy

Trade enhances the economic well-being of a nation in the sense that

When a country allows trade and becomes an exporter of a good

When a country allows trade and becomes an exporter of a good, which of the following is NOT a consequence?

Suppose a country begins to allow international trade in steel. Which of the following outcomes will be observed regardless of whether the country finds itself importing steel or exporting steel?

The United States has imposed taxes on some imported goods that have been sold here by foreign countries at below their cost of production. These taxes

Suppose a certain country imposes a tariff on a good. Which of the following results of the tariff is possible?