Transcript Chapter 4 Checkpoint

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Efficiency and
Fairness of Markets
6
CLICKER QUESTIONS
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Checkpoint 6.1
Checkpoint 6.3
Checkpoint 6.5
Question 1
Question 5
Question 9
Question 2
Question 6
Question 10
Checkpoint 6.2
Checkpoint 6.4
Question 3
Question 7
Question 4
Question 8
CHECKPOINT 6.1
Question 1
If a person will rent an apartment only to married couples
over 30 years old, that person is allocating resources using
a ____ allocation method.
A.
B.
C.
D.
E.
first-come, first-served
market price
contest
personal characteristics
command
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CHECKPOINT 6.1
Question 2
Allocative efficiency occurs when _______.
A.
B.
C.
D.
E.
the most highly valued goods and services are produced
all citizens have equal access to goods and services
the environment is protected at all cost
goods and services are free
production takes place at a point on the PPF
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CHECKPOINT 6.2
Question 3
Value of a good is _________.
A. the price we pay for the good
B. the cost of resources used to produce the good
C. objective so that it is determined by market forces, not
preferences
D. the marginal benefit we get from the good
E. the price paid for a good minus the marginal cost of
producing that unit of the good
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CHECKPOINT 6.2
Question 4
Suppose the price of a scooter is $200, and Cora Lee is
willing to pay $250 for it. Cora Lee’s ________.
A.
B.
C.
D.
E.
consumer surplus from the scooter is $200
consumer surplus from the scooter is $50
marginal benefit from the scooter is $200
consumer surplus from the scooter is $200
consumer surplus from the scooter is $25
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CHECKPOINT 6.3
Question 5
A supply curve of a good shows the _______.
A.
B.
C.
D.
E.
producer surplus received from selling the good
consumer surplus received from buying the good
total benefit from the good
marginal cost of producing the good
marginal benefit received by the producer of the good
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CHECKPOINT 6.3
Question 6
Suppose you’re willing to tutor a student for $10 an hour, but
the student values your service and pays you $15 an hour.
What is your producer surplus?
A. $5 an hour
B. $10 an hour
C. $15 an hour
D. $25 an hour
E. more than $25 an hour
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CHECKPOINT 6.4
Question 7
A market is efficient when _______.
producers’ income is as high as possible
producers’ costs equal consumers’ benefits
consumer surplus equals producer surplus
scarce resources are used to produce the goods and
services that people value most highly
E. scarcity is eliminated
A.
B.
C.
D.
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CHECKPOINT 6.4
Question 8
When production moves from the efficient quantity to a point
of overproduction, _________.
A. consumer surplus will increase
B. the sum of producer surplus and consumer surplus will
increase
C. a deadweight loss arises
D. consumers will lose but producers will gain
E. consumers gain what producers lose
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CHECKPOINT 6.5
Question 9
The idea that “unequal income is unfair” generally uses the
____ principle of fairness.
A.
B.
C.
D.
E.
big tradeoff
involuntary exchange
voluntary exchange
it’s not fair if the result isn’t fair
it’s not fair if the rules aren’t fair
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CHECKPOINT 6.5
Question 10
Which of the following is an example in which “the big
tradeoff” can occur?
A. The government redistributes income from the rich to the
poor.
B. Ford increases the price of a pickup truck.
C. A basketball player signs a $5 million contract.
D. A college lowers tuition.
E. The price of a personal computer falls year after year
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