ECON 160 Lecture Notes - Lecture 9: Economic Equilibrium, Demand Curve, Opportunity Cost

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indigoraven449

16 Nov 2016

School

Binghamton University

Department

Economics

Course

ECON 160

Professor

Susan W.Hanes

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Document Summary

Chapter 4: the market forces of supply and demand (cont) The benefit from consuming for the marginal consumers is approximately equal to the cost of producing for the marginal supplier. *only suppliers (producers) with price is greater than or equal to opportunity cost with firm join the market. Not purchasing because value of consumption is less than valued price. * everyone on left side of graph is in the market. * everyone on right side is not in market. * people in middle are at equilibrium is a continuous line segment. If the demand and supply curves are continuous, then infinite number of points. If you have continuous lines then we can read off the demand curve, the value of consuming. If you have continuous line then we can read off the supply curve the opportunity cost of the supplier (firm) Value of consumption is preferences, income, price of related goods (affects demand), number of buyers in market.

Related Questions

1. If the price of a product decreases, we would expect:

a. Demand to increase

b. Quantity supplied to decrease

c. Supply to decrease

d. Quantity supplied to increase

2. "Price" in the statement of the Law of Supply refers to:

a. The amount that buyers are willing and able to pay for each unit of the product.

b. Marginal cost of producing the last unit of the product.

c. The total revenues that sellers receive for selling a given quantity of the product.

d. The total amount that buyers pay to acquire a given quantity of the product.

3. A decrease in demand and an increase in supply will:

a. Affect price in an indeterminate way and decrease the equilibrium quantity

b. Increase the price and affect the equilibrium quantity in an indeterminate way

c. Decrease price and affect the equilibrium quantity in an indeterminate way

d. Increase the price and increase the equilibrium quantity

4. When producers (say, of roads) are not able to make all consumers pay for enjoying their product (i.e., the roads), they tend to see:

a. The marginal cost of production is too low, and there is a supply-side market failure

b. The marginal benefit of production is too high, and there is a demand-side market failure

c. The marginal cost of production is too high, and there is a supply-side market failure

d. The marginal benefit of production that is too low, and there is a demand-side market failure

peachcrow879

The table presents the weekly demand and supply schedule for lawnmowers.

Market for Lawnmowers
Price (dollars)	Quantity of Lawnmowers Demanded	Quantity of Lawnmowers Supplied
$400	45	105
350	50	95
300	55	85
250	60	75
200	65	65
150	70	55

Assuming suppliers produce 75 lawnmowers per week:

1. this quantity is allocatively efficient because it will require producers to reduce the price of lawnmowers to sell all of the lawnmowers produced.

2. this quantity is allocatively efficient because the last lawnmower provides more benefits to consumers than alternative uses of the resources required to produce it.

3. this quantity is allocatively inefficient because the marginal cost of producing the last lawnmower is less than its marginal benefit to consumers.

4. this quantity is allocatively inefficient because the marginal cost of producing the last lawnmower exceeds its marginal benefit to consumers.

turquoisebear206

When a government provides a good with an external benefit, to attain efficiency the price paid by consumers is set equal to the ________.

A. market demand price

B. amount paid by taxpayers

C. marginal private benefit at the efficient level of output

D. marginal private cost at the efficient level of output

Which of the following actions is appropriate in a market with an external benefit?

A. taxes

B. vouchers

C. marketable permits

D. price ceiling

When a person receives a flu vaccination, the ________ is the additional benefit the person receives from getting the shot.

A. marginal private benefit

B. marginal external benefit

C. marginal social benefit

D. marginal social cost

Pell grants given to students attending college are most closely similar to ________.

A. public provision of a good

B. private subsidies are given to producers of a good

C. property rights assigned to consumers of a good

D. vouchers are given to a consumer of a good

Technology that prevents Paul in California from using an email account of Sarah's in Maryland means that email is an example of ________.

A. an excludable good

B. a good that is non-excludable

C. a public good

D. the tragedy of the commons

pucecat409

ECON 160 Lecture Notes - Lecture 9: Economic Equilibrium, Demand Curve, Opportunity Cost

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