Midterm Review Tableshave Fun

Midterm Review TablesHave Fun 

Alternatives / A / B / C / D / E / F
Consumer goods per period / 0 / 1 / 2 / 3 / 4 / 5
Capital goods per period / 30 / 28 / 24 / 18 / 10 / 0
Table 3-1: Production Possibilities Schedule I

1.(Table 3-1: Production Possibilities Schedule I) If the economy produces 2 units of consumer goods per period, it also can produce at most ______units of capital goods per period.

a. / 30
b. / 28
c. / 24
d. / 18
e. / 26
Quantity of Hours of Study Time / Quantity of Hours of Leisure Time
16 / 0
12 / 4
8 / 8
4 / 12
0 / 16
Table 3-3: Trade-off of Study Time and Leisure Time

2.(Table 3-3: Trade-off of Study Time and Leisure Time) A student sleeps 8 hours per day and divides the remaining time between study time and leisure time. The table shows the combinations of study and leisure time that can be produced in the 16 waking hours of each day. If a student decides to consume one additional hour of leisure time, how many hours of study time must be given up?

a. / 4
b. / .25
c. / 1
d. / 16
e. / 2

Figure 3-11: Production Possibilities and Circular-Flow Diagram

3.(Figure 3-11: Production Possibilities and Circular-Flow Diagram) Assume the figures represent the same economy. Suppose that in the circular-flow diagram there is a significant decrease in the amount of labor that is flowing to the firms that produce coconuts. If all other variables remain unchanged, then this adjustment in the economy would be best represented in the production possibilities figure by a move from point A toward:

a. / point A (no movement would occur).
b. / point B (an increase in fish production).
c. / point C (a decrease in coconut production).
d. / point D (an outward shift of the entire curve..
e. / point B (an increase in coconut production).
Combination / Good Z / Good X
A / 0 / 75
B / 5 / 70
C / 10 / 60
D / 15 / 45
E / 20 / 25
F / 25 / 0
Table 3-5: Production of Good Z and Good X in Urbanville

4.(Table 3-5: Production of Good Z and Good X in Urbanville) Suppose Urbanville is currently producing 15Z and 45X. This combination is:

a. / both allocatively and productively efficient.
b. / productively efficient.
c. / allocatively efficient.
d. / neither productively nor allocatively efficient.
e. / not feasible.
Wheat Production / Aluminum Production
U.S. / 100 / 0
0 / 100
Wheat Production / Aluminum Production
Germany / 50 / 0
0 / 100
Table 4-4: Wheat and Aluminum

5.(Table 4-4: Wheat and Aluminum) The United States and Germany can produce both wheat and aluminum. The table shows the maximum annual output combinations of wheat and aluminum that can be produced. Which of the following choices would represent a possible trade based upon specialization and comparative advantage?

a. / Germany would trade 2 wheat to the U.S. for 1 aluminum.
b. / Germany would trade 2 aluminum to the U.S. for .5 wheat.
c. / The United States would trade 1 wheat to Germany for 1 aluminum.
d. / The United States would trade 1 wheat to Germany for 1.5 aluminum.
e. / The United States would trade 1 aluminum to Germany for 1 wheat.
Quantity Demanded (bags per month)
Price per Bag / George / Barbara / Dan
$0.90 / 10 / 0 / 60
0.80 / 15 / 10 / 80
0.70 / 20 / 20 / 100
0.60 / 25 / 30 / 120
0.50 / 30 / 40 / 140
0.40 / 35 / 50 / 160
0.30 / 40 / 60 / 180
Table 5-1: The Demand for Chocolate-Covered Peanuts

6.(Table 5-1: The Demand for Chocolate-Covered Peanuts) If the price of chocolate-covered peanuts is $0.60 the quantity demanded by George is ______bags per month.

a. / 10
b. / 15
c. / 25
d. / 30
e. / 120

7.(Table 5-1: The Demand for Chocolate-Covered Peanuts) If Barbara is only able to purchase 20 bags of chocolate-covered peanuts, the maximum price she is willing and able to pay for each bag is ______.

a. / $0.90
b. / $0.80
c. / $0.70
d. / $0.60
e. / $0.50

8.(Table 5-1: The Demand for Chocolate-Covered Peanuts) If George, Barbara, and Dan are the only three buyers in the market, and the price of a bag of chocolate-covered peanuts is $0.80, the total market demand is ______bags per month.

a. / 70
b. / 80
c. / 105
d. / 280
e. / 15

9.(Table 5-1: The Demand for Chocolate-Covered Peanuts) If George, Barbara, and Dan are the only three buyers in the market, and the price of a bag of chocolate-covered peanuts is $0.50, the total market demand is ______bags per month.

a. / 80
b. / 105
c. / 140
d. / 280
e. / 210

10.A market is composed of three individuals, Nicholas, Benjamin, and Alexander. Their individual demand schedules are given below and are as follows:

Nicholas / Benjamin / Alexander
Price / Quantity Demanded / Price / Quantity Demanded / Price / Quantity Demanded
1 / 10 / 1 / 15 / 1 / 12
2 / 9 / 2 / 11 / 2 / 10
3 / 8 / 3 / 9 / 3 / 8

Based on this information, which of the following market demand schedules accurately portrays this market?

a. / Price Quantity Demanded
1 27
2 35
3 30
b. / Price Quantity Demanded
1 20
2 5
3 25
c. / Price Quantity Demanded
1 37
2 30
2 25
d. / Price Quantity Demanded
1 25
2 30
3 10
e. / Price Quantity Demanded
1 35
2 25
3 25
Price of Lemonade (per cup) / Number of Cups Demanded (Qd.) / Number of Cups Supplied (Qs)
$ .50 / 250 / 25
$ .75 / 200 / 50
$1.00 / 150 / 75
$1.25 / 100 / 100
$1.50 / 50 / 125
$1.75 / 20 / 150
Table 6-3: The Lemonade Market

11.(Table 6-3: The Lemonade Market) If the price of a cup of lemonade is $1.00, what will exist in the market?

a. / equilibrium
b. / a shortage of 150 cups
c. / a shortage of 75 cups
d. / a surplus of 75 cups
e. / a shortage of 225 cups
Price (unit) / Quantity Demanded (units) / Quantity Supplied (units)
$1.10 / 9,000 / 3,000
1.20 / 8,000 / 5,000
1.30 / 7,000 / 7,000
1.40 / 6,000 / 9,000
1.50 / 5,000 / 1,100
Table 8-1: Market for Fried Twinkies

12.(Table 8-1: Market for Fried Twinkies) In response to popular anger over the high price of fried Twinkies, the government imposes a price ceiling of $1.20 per fried Twinkie. From this table, the price ceiling causes:

a. / a shortage of 3,000 fried Twinkies.
b. / a shortage of 5,000 fried Twinkies.
c. / a surplus of 8,000 fried Twinkies.
d. / a surplus of 3,000 fried Twinkies.
e. / a shortage of 5,000 fried Twinkies.
Price ($/unit) / Quantity Demanded (units) / Quantity Supplied (units)
0.50 / 10 / 7
0.75 / 8 / 8
1.00 / 6 / 9
1.25 / 4 / 10
1.50 / 2 / 11
Table 8-2: Market for a Can of Soda

13.(Table 8-2: Market for a Can of Soda) If the government does not impose a price control, the price of a can of soda will equal:

a. / $0.50.
b. / $0.75.
c. / $1.00.
d. / $1.25.
e. / $1.50
P / Qp / Qs
$1.20 / 9.0 / 12.0
1.10 / 9.5 / 11.0
1.00 / 10.0 / 10.0
0.90 / 10.5 / 9.0
0.80 / 11.0 / 8.0
Table 8-3: Market for Butter

Note:

P = Price per lb in $;

Qp= Quantity demanded in millions of lbs;

Qs= Quantity supplied in millions of lbs.

14.(Table 8-3: Market for Butter) If the government imposes a price ceiling of $0.90 per pound of butter, the quantity of butter actually purchased will be:

a. / 10.5 million pounds.
b. / 9.0 million pounds.
c. / 1.5 million pounds.
d. / 10.0 million pounds.
e. / 19.5 million pounds.
Price per Treatment / Quantity Treatments Demanded (monthly) / Quantity Treatments Supplied (monthly)
$50 / 100 / 20
100 / 80 / 40
150 / 60 / 60
200 / 40 / 80
250 / 20 / 100
Table 9-2 The Market for Acupuncture

15.(Table 9-2 The Market for Acupuncture) A small town has a thriving market for acupuncture treatments. In an effort to regulate this market, the town requires each acupuncture therapist to purchase a license. Initially, the government issues only enough licenses to provide for 20 treatments per month. This quota creates a quota rent equal to:

a. / $50.
b. / $100.
c. / $150.
d. / $250
e. / .$200.

16.

Price
(per pizza) / Quantity of
Pizza Demanded (given income of $1,000 per month) / Quantity of
Pizza Demanded (given income of $1,400 per month)
$20 / 3 / 7
18 / 4 / 8
16 / 5 / 9
14 / 6 / 10
12 / 7 / 11
10 / 8 / 12
8 / 9 / 13
6 / 10 / 14
Table: Market for Pizza

In the table, when income changes from $1,000 to $1,400 per month, the income elasticity of demand for pizza at a price of $14 per pizza is:

a. / –1.
b. / 1.
c. / 0.25.
d. / 4.
e. / 1.5.

Table 48-1: Johnson’s Income and Expenditures

Monthly
Income / Quantity Purchased per Month
Steaks / Magazines / Movies / Pizzas
$2,000 / 2 / 4 / 6 / 8
$3,000 / 2 / 6 / 6 / 6
Table 48-1: Johnson's Income and Expenditures

17.(Table 48-1: Johnson's Income and Expenditures) Johnson's income elasticity of demand for steaks is:

a. / greater than 1.
b. / 1.
c. / less than 1 but greater than 0.
d. / 0.
e. / less than zero.
This table shows some Atlanta college students' willingness to pay to see The Nutty Nutcracker, by the Atlanta Ballet.
Student / Willingness to Pay
Lois / $100
Miguel / 90
Narum / 65
Oscar / 50
Pat / 15
Table 49-2: Consumer Surplus

18.(Table 49-2: Consumer Surplus) If the price of a ticket to see The Nutty Nutcracker is $50, then Lois's consumer surplus is:

a. / $60.
b. / $50.
c. / $15.
d. / $240.
e. / $150.
Number of
Music Downloads / Eli's
Willingness to Pay / Madison's
Willingness to Pay
1st song / $4.50 / $3
2nd song / 3.50 / 2
3rd song / 2.50 / 1
4th song / 1.50 / 0.50
5th song / 0.50 / 0.50
Table 49-3: Music Downloads

19.(Table 49-3: Music Downloads) Two consumers, Eli and Madison, like to download songs to their MP3 players. The table represents their willingness to pay for each downloaded song. If an individual song can be downloaded at a price of $1, what is the total consumer surplus received by these consumers?

a. / $19.25
b. / $18
c. / $10
d. / $11
e. / $19

20.Recently, the government considered adding an excise tax on CDs that can be used to record music. If this tax is enacted, how would it affect the price consumers pay, the price producers receive, and the quantity of CDs exchanged?

Price consumers pay / Price producers receive / Quantity of CDs
Exchanged
(A) / Higher / Lower / Fewer
(B) / Higher / Higher / Fewer
(C) / Lower / Lower / Fewer
(D) / Higher / Lower / More
(E) / Lower / Higher / More
a. / A
b. / B
c. / C
d. / D
e. / E

21.Suppose the demand for good Z is downward sloping and the supply of good Z is upward sloping. When the government imposes an excise tax in the market for good Z, what happens to consumer surplus, producer surplus, and deadweight loss?

Consumer surplus / Producer surplus / Deadweight loss
(A) / falls / falls / rises
(B) / falls / rises / rises
(C) / rises / falls / falls
(D) / falls / falls / falls
(E) / rises / falls / rises
a. / A
b. / B
c. / C
d. / D
e. / E

22.How does an excise tax affect consumer surplus and producer surplus

Consumer surplus / Producer surplus
(A) / Increases / Increases
(B) / Increases / Decreases
(C) / Decreases / Increases
(D) / Decreases / Decreases
(E) / No change / No change
a. / A
b. / B
c. / C
d. / D
e. / E
Pre-Tax
Income / Proposal 1:
After-Tax Income / Proposal 2:
After-Tax Income / Proposal 3:
After-Tax Income
$20,000 / $16,000 / $18,000 / $16,000
$40,000 / $32,000 / $34,000 / $34,000
$60,000 / $48,000 / $45,000 / $54,000
$80,000 / $64,000 / $56,000 / $76,000
$100,000 / $80,000 / $65,000 / $98,000
Table 50-3: Three Tax Structure Proposals

23.(Table 50-3: Three Tax Structure Proposals) A regressive tax structure can be found in:

a. / Proposal 1.
b. / Proposal 2.
c. / Proposal 3.
d. / all the proposals.
e. / Proposals 2 and 3.
Units / 0 / 1 / 2 / 3 / 4 / 5 / 6 / 7
Total Utility / 0 / 20 / 35 / 45 / 50 / 50 / 45 / 35
Table 51-1: Utility

24.(Table 51-1: Utility) The marginal utility for the second unit is:

a. / 35.
b. / 15.
c. / 10.
d. / 5.
e. / 55.
Hours of
Exercise / Total Utility
0 / 0
1 / 5
2 / 15
3 / 23
4 / 29
5 / 33
Table 51-2: Exercise and Total Utility

25.(Table 51-2: Exercise and Total Utility) The table shows a consumer's total utility from consuming hours of exercise at the gym. Given this information, what can be said about this consumer's marginal utility curve for exercise?

a. / Marginal utility initially decreases, but eventually increases as more exercise is consumed.
b. / Marginal utility always decreases as more exercise is consumed.
c. / Marginal utility always increases as more exercise is consumed.
d. / Marginal utility initially increases, but eventually stays constant as more exercise is consumed.
e. / Marginal utility initially increases, but eventually decreases as more exercise is consumed.

26.

Pounds of
Oranges / Total Utility
from Oranges / Pounds of
Starfruit / Total Utility
from Starfruit
0 / 0 / 0 / 0
1 / 24 / 1 / 70
2 / 44 / 2 / 130
3 / 60 / 3 / 180
4 / 72 / 4 / 220
5 / 80 / 5 / 250
6 / 84 / 6 / 270
7 / 84 / 7 / 280
Table: Utility from Oranges and Starfruit

Oranges costs $2 per pound and starfruit cost $5 per pound. The table shows Ned's total utility from eating various amounts of oranges and starfruits. How many pounds of oranges and starfruit should Ned eat, if Ned has $26?

a. / 0 pound of oranges, 5 pounds of starfruit, $1 left over
b. / 8 pounds of oranges and 2 pounds of starfruit
c. / 3 pounds of oranges and 4 pounds of starfruit
d. / 4 pounds of oranges and 5 pounds of starfruit
e. / 3 pounds of oranges and 3 pounds of starfruit
Number of Games / Total Benefit
0 / 0
1 / 50
2 / 90
3 / 120
4 / 140
5 / 152
6 / 160
7 / 164
8 / 162
Table 53-1: Marginal and Total Benefit

27.(Table 53-1: Marginal and Total Benefit) Rodger is deciding how many football games he wants to attend this year. The total benefit that Rodger receives from football games is shown in the table. Rodger's marginal benefit from increasing the number of games that he attends from two to three is:

a. / 40.
b. / 120.
c. / 10.
d. / 20.
e. / 30.

28.

Quantity
of Gadgets
Produced / Total Cost
0 / $100
1 / $105
2 / $110
3 / $115
4 / $120
5 / $125
Table: The Cost of Producing Gadgets

You own a small manufacturing company that produces gadgets. The table shows the quantity of gadgets that you could produce, and the total cost you incur at each level of production. According to this table, marginal cost is:

a. / increasing at a constant rate.
b. / increasing at an increasing rate.
c. / increasing at a decreasing rate.
d. / constant and equal to $5.
e. / decreasing.
Quantity
of Labor / Total
Output
0 / 0
1 / 12
2 / 22
3 / 30
4 / 36
5 / 40
6 / 43
7 / 44
Table 54-1 : Labor and Output

29.(Table 54-1: Labor and Output) Referring to the table, the marginal product of the fifth worker is:

a. / 8.
b. / 4.
c. / 3.
d. / 40.
e. / 36.
Quantity
of Labor
(workers) / Quantity of
Cabinets Q / Marginal Product
of Labor
(cabinets per worker)
0 / 0
1 / 5 / 5
2 / 11 / 6
3 / 16 / 5
4 / 20 / 4
5 / 23 / 3
6 / 25 / 2
7 / 26 / 1
8 / 25 / -1
Table 54-3: Production of Cabinets

30.(Table 54-3: Production of Cabinets) The table shows how many cabinets your firm can make with a variable quantity of labor hired. After which worker does the firm first begin to experience diminishing returns to labor?

a. / first
b. / second
c. / third
d. / fourth
e. / fifth
Quantity
of Output / Variable Cost
VC / Total Cost
TC
0 / 0 / 50
1 / 50 / 100
2 / 70 / 120
3 / 100 / 150
4 / 140 / 190
5 / 240
6 / 250 / 300
7 / 320 / 370
Table 55-1: Cost Data

31.(Table 55-1: Cost Data) The table shows some cost data for a firm currently operating in the short run. What is the value of the total fixed cost for this firm?

a. / $40
b. / $50
c. / $100
d. / $70
e. / It is impossible to determine without more information.
Q = output, FC = fixed cost, VC = variable cost,
TC = total cost, MC = marginal cost
Q / FC / VC / TC / MC
1 / 20 / 10 / 30
2 / 20 / 18 / 38
13
3 / 20 / 31
17
4 / 20 / 68
Table 55-2: Output and Costs

32.(Table 55-2: Output and Costs) Using the information in the table, when quantity increases from one to two, marginal cost equals:

a. / 13.
b. / 10.
c. / 18.
d. / 17.
e. / 8.
Quantity
of Bagels
(per period) / Total
Variable Costs / Total
Fixed Costs
0 / $0.00 / $0.10
1 / 0.20 / 0.10
2 / 0.30 / 0.10
3 / 0.35 / 0.10
4 / 0.45 / 0.10
5 / 0.60 / 0.10
6 / 0.80 / 0.10
7 / 1.05 / 0.10
8 / 1.35 / 0.10
Table 55-3: Costs of Producing Bagels

33.(Table 55-3: Costs of Producing Bagels) The total cost of producing six bagels is:

a. / $0.10.
b. / $0.20.
c. / $0.80.
d. / $0.90.
e. / $0.15.

34.(Table 55-3: Costs of Producing Bagels) The marginal cost of producing the sixth bagel is:

a. / $0.10.
b. / $0.15.
c. / $0.20.
d. / $0.80.
e. / $0.60.

35.(Table 55-3: Costs of Producing Bagels) Marginal cost reaches its minimum value for the ______bagel.

a. / first
b. / third
c. / fourth
d. / fifth
e. / second

36.(Table 55-3: Costs of Producing Bagels) The average total cost of producing six bagels is:

a. / $0.10.
b. / $0.60.
c. / $0.20.
d. / $0.80.
e. / $0.15.

37.(Table 55-3: Costs of Producing Bagels) The total cost of producing two bagels is:

a. / $0.10.
b. / $0.20.
c. / $0.40.
d. / $0.50.
e. / $0.30.

38.(Table 55-3: Costs of Producing Bagels) The average total cost of producing two bagels is:

a. / $0.05.
b. / $0.10.
c. / $0.20.
d. / $0.40.
e. / $0.25.

39.(Table 55-3: Costs of Producing Bagels) The marginal cost of producing the second bagel is:

a. / $0.05.
b. / $0.10.
c. / $0.30.
d. / $0.40.
e. / $0.20.

40.

Quantity of
Soybeans
(bushels) / Long-Run
Total Cost
1 / $ 50
2 / $ 80
3 / $ 90
4 / $120
5 / $200
6 / $300
Table: Long-Run Total Cost

Over what range of output does this soybean grower experience constant returns to scale?

a. / the first and second bushels
b. / the third and fourth bushels
c. / the fourth and fifth bushels
d. / the fifth and sixth bushels
e. / the second and third bushels

41.

Output / Total Cost
0 / $10
1 / 60
2 / 80
3 / 110
4 / 170
5 / 245
Table: Total Cost and Output

The table describes Bart's perfectly competitive ice cream-producing firm. If the market price is $67.50, how many units of output will the firm produce?

a. / one
b. / two
c. / three
d. / four
e. / five
Quantity
of Soybeans
(bushels) / Total Cost
(TC)
0 / 12
1 / 26
2 / 33
3 / 42
4 / 54
5 / 69
6 / 84
7 / 104
Table 58-1 : Soybean Cost

42.(Table 58-1: Soybean Cost) The costs of production of a perfectly competitive soybean farmer are given in the table. If the market price of a bushel of soybeans is $15, how many bushels will the farmer produce to maximize short-run profit?

a. / 4
b. / 5
c. / 3
d. / 7
e. / 2
Quantity
per Period / Total Cost
0 / $10
1 / 16
2 / 20
3 / 22
4 / 24
5 / 25
6 / 27
7 / 30
8 / 34
9 / 39
10 / 45
Table 58-3: Total Cost for a
Perfectly Competitive Firm

43.(Table 58-3: Total Cost for a Perfectly Competitive Firm) If the market price is $4.50, the profit-maximizing quantity of output is ______units.

a. / five
b. / seven
c. / eight
d. / nine
e. / ten
Quantity
of Lots / Variable Costs
0 / $0
10 / 200
20 / 300
30 / 500
40 / 750
50 / 1,100
Table 59-1: Variable Costs for Lots

44.(Table 59-1: Variable Costs for Lots) During the winter, Alexa runs a snow-clearing service, and snow-clearing is a perfectly competitive industry. Her only fixed cost is $1,000 for a tractor. Her variable costs per cleared lot, shown in the table, include fuel and hot coffee. What is Alexa's shut-down price in the short run?

a. / $0
b. / $15
c. / $50
d. / $42
e. / $20
Quantity
per Period / Total Cost
0 / $10
1 / 16
2 / 20
3 / 22
4 / 24
5 / 25
6 / 27
7 / 30
8 / 34
9 / 39
10 / 45
Table 59-2: Total Cost for a Perfectly Competitive Firm

45.(Table 59-2: Total Cost for a Perfectly Competitive Firm) In the short run, the firm will produce, but at a loss, if the price is:

a. / $2.00.
b. / $2.50.
c. / $3.50.
d. / $4.50.
e. / $1.50.

46.

Quantity
of Appels
(bushels) / VC
0 / $ 0
1 / 40
2 / 70
3 / 80
4 / 130
5 / 190
6 / 260
7 / 340
8 / 430
Table: Lilly's Apple Orchard

Lilly is the price-taking owner of an apple orchard; its variable costs are given in the table. Her orchard has fixed costs of $30. If the price of a bushel of apples is $85, we would expect total industry output to:

a. / rise, and Lilly's output will rise in the long run.
b. / fall, and Lilly's output will fall in the long run.
c. / fall, while Lilly's output will rise in the long run.
d. / rise, while Lilly's output will fall in the long run.
e. / rise, while Lilly's output will remain unchanged in the long run.
Quantity
(megawatts) / Price per
Megawatt / Total Cost
1 / $550 / $1,000
2 / 500 / 1,075
3 / 450 / 1,200
4 / 400 / 1,375
5 / 350 / 1,600
6 / 300 / 1,875
7 / 250 / 2,200
8 / 200 / 2,575
Table 61-1: Demand and Total Cost

47.(Table 61-1: Demand and Total Cost) Lenoia runs a natural monopoly producing electricity for a small mountain village. The table shows Lenoia's demand and total cost of producing electricity. The price effect of increasing production from 3 megawatts to 4 megawatts is:

a. / –$150.
b. / $500.
c. / $450.
d. / –$50.
e. / - $400
Price
of Coffee
(per cup) / Quantity
of Coffee
Sold (daily cups)
$10 / 0
9 / 1
8 / 2
7 / 3
6 / 4
5 / 5
4 / 6
3 / 7
2 / 8
1 / 9
0 / 10
Table 61-2: Demand for Lenny's Coffee

48.(Table 61-2: Demand for Lenny’s Coffee) Lenny's Café is the only source of coffee for hundreds of miles in any direction. The demand schedule for Lenny's coffee is given by the table. If Lenny wants to increase the quantity of cups sold from five to six, his marginal revenue will be equal to:

a. / $4.
b. / $24.
c. / –$1.
d. / $5.
e. / $20.

49.

Price
of Coffee
(per cup) / Quantity
of Coffee
Sold (daily cups)
10 / 0
9 / 1
8 / 2
7 / 3
6 / 4
5 / 5
4 / 6
3 / 7
2 / 8
1 / 9
0 / 10
Table: Demand for Lenny's Coffee

Lenny's Cafe is the only source of coffee for hundreds of miles in any direction. The demand schedule for Lenny's coffee is given by the table. If Lenny's marginal cost of selling coffee is a constant $2, and the government forced Lenny to charge a price that eliminated deadweight loss, Lenny would charge a price of ______per cup and sell ______cups.

a. / $0; ten
b. / $2; eight
c. / $4; six
d. / $5; five
e. / $1; nine

50.

Quantity
of Hats
Demanded / Price
per Hat
0 / $30
1 / 28
2 / 26
3 / 24
4 / 22
5 / 20
6 / 18
7 / 16
8 / 14
Table: Prices and Demands

Prof. Dumbler has a monopoly on magic hats. He sells at most one hat to each customer, and the table shows each customer's willingness to pay. The marginal cost of producing a hat is $18. Suppose Dumbler can perfectly price discriminate. How many hats will he produce?

a. / three
b. / four
c. / five
d. / six
e. / seven

51.

Price of
a Gadget / Quantity of
Gadgets Demanded
$10 / 0
9 / 100
8 / 200
7 / 300
6 / 400
5 / 500
4 / 600
3 / 700
2 / 800
1 / 900
0 / 1000
Table: Demand Schedule for Gadgets

The market for gadgets is dominated by two producers, Margaret and Ray. Each firm can produce gadgets at marginal costs of approximately zero dollars. The table shows the market demand schedule for gadgets and the total revenue of the industry at each point on the market demand curve. If these two producers acted independently to maximize profit, total industry output would be ______. If these two producers formed a cartel and acted to maximize total industry profits, total industry output would be ______.

a. / 5 gadgets; 10 gadgets
b. / 0 gadgets; 5 gadgets
c. / 100 gadgets; 50 gadgets
d. / 1,000 gadgets; 500 gadgets
e. / 1,000 gadgets; 100 gadgets

52.

Quantity / Price ($/barrel) / Total Revenue ($)
0 / $160 / $ 0
10 / 150 / 1,500
20 / 140 / 2,800
30 / 130 / 3,900
40 / 120 / 4,800
50 / 110 / 5,500
60 / 100 / 6,000
70 / 90 / 6,300
80 / 80 / 6,400
90 / 70 / 6,300
100 / 60 / 6,000
110 / 50 / 5,500
120 / 40 / 4,800
130 / 30 / 3,900
140 / 20 / 2,800
150 / 10 / 1,500
160 / 0 / 0
Table: Demand for Crude Oil

The table shows the demand schedule for crude oil. For simplicity, assume that the cost of producing crude oil is zero—the marginal cost of crude oil equals zero. Now assume Laverne and Shirley are the only two producers of crude oil, and they cannot cooperate. But assume they choose their output levels every week, each player has a tit-for-tat strategy, and the other player knows this. In this case, what will be the equilibrium choice of outputs? Laverne will produce ______barrels and Shirley will produce ______barrels.