1 .		Refer to the figure below. The length of the arrows represents:     The total benefit received from consuming quantities 1, 2, and 3, respectively.   The total cost of producing quantities 1, 2, and 3, respectively.   The additional benefit received from consuming quantities 1, 2, and 3, respectively.   The additional cost of producing quantities 1, 2, and 3, respectively.
2 .		Refer to the figure below. A drop in price, from $8 to $6 means:     A drop in consumer surplus equal to area B.   An increase in consumer surplus equal to area A for existing consumers, and area C for new consumers.   An increase in consumer surplus, but only for existing consumers, prior to the price decrease.   An increase in consumer surplus equal to areas B + C + D + E.
3 .		Refer to the figure below. When the price is $6, how much is consumer surplus in this market?     $15.   $20.   $51.   $30.
4 .		Refer to the figure below. Assume that there are five producers, each supplying one additional unit of output. How much is the producer surplus of the fifth producer?     $1.   $5.   $6.   $15.
5 .		Refer to the figure below. Which of the highlighted areas is known as social surplus?     A.   B.   A + B.   C.
6 .		Refer to the figure below. Relative to the equilibrium market price of $6, a minimum price of $8 results in:     An increase in both producer surplus and consumer surplus.   A decrease in both consumer surplus and producer surplus.   An increase in consumer surplus and a decrease in producer surplus.   A decrease in consumer surplus and an increase in producer surplus.
7 .		Refer to the figure below. Which of the following statements is entirely correct?     There is higher consumer surplus in the water market because, at the margin, water commands a higher additional value.   Consumer surplus in the diamond market is small because diamonds are scarce.   The total value consumers receive from diamonds is greater than the total value of water consumed.   All of the statements above are correct.
8 .		Refer to the figure below. What can be said about the participation of Siggy in the market?     Siggy is the only one that gets the lawn cut for a price lower than the equilibrium price.   Siggy buys six lawn cuts, but receives no consumer surplus.   Siggy does not participate in a market transaction at all.   Siggy buys one lawn cut, pays a price lower than $10, and receives an unknown amount of consumer surplus.
9 .		Refer to the figure below. Which of the following statements is/are correct?     Abe would like to participate in the market, but cannot participate because the market price is higher than $2.   Eve participates in the market but does not earn any producer surplus.   Efrin receives the maximum amount of producer surplus.   All of the above.
10 .		Refer to the figure below. Relative to market equilibrium, the impact of the maximum price of $4 can be described as follows:     After the maximum price is imposed, only Cecil and Vivian earn surplus.   Luciana benefits the most from the maximum price.   The maximum price of $4 benefits all producers—some more than others.   All consumers benefit from the maximum price.
11 .		Refer to the figure below. The minimum price of $19:     Prevents Luciana from participating in the market.   Prevents all producers from participating in the market.   Benefits Vivian and Maclovia the most.   Increases the producer surplus of Abe and Bea.
12 .		Refer to the figure below. The figure describes the decision of a country to engage in trade. When it does, the country abides by the world price, not the domestic price. How are domestic consumers and producers affected by the decision to trade?     Both consumers and producers are made worse off by the decision to trade.   Consumers are made better off and producers are made worse off by the decision to trade.   Consumers are made worse off and producers are made better off by the decision to trade.   Both consumers and producers are made better off by the decision to trade.
13 .		Refer to the figure below. The figure describes the decision of a country to engage in trade. When it does, the country abides by the world price, not the domestic price. How are domestic consumers and producers affected by the decision to trade?     Both consumers and producers are made worse off by the decision to trade.   Consumers are made better off and producers are made worse off by the decision to trade.   Consumers are made worse off and producers are made better off by the decision to trade.   Both consumers and producers are made better off by the decision to trade.
14 .		Refer to the figure below. Which of the following statements is entirely correct?     Trade increases the value of social surplus, although consumers gain surplus and producers lose surplus.   The value of social surplus decreases because both producers and consumers lose surplus as a result of trade.   The value of social surplus increases because both consumer and producer surplus realize gains from trade.   Since producers gain and consumers lose surplus, the value of social surplus remains the same.
15 .		Refer to the figure below. The deadweight loss occurs because:     Apartments are rented only to those who are willing to pay the highest prices.   Too many units are rented relative to the number of units that would be rented at the equilibrium price.   The price ceiling causes too many apartments to remain vacant.   The price ceiling causes fewer units to be rented and an inefficient allocation of apartments among prospective tenants.
16 .		Refer to the figure below. After the government limits the number of licenses so that only 60 haircuts per day can be supplied:     There is a transfer of producer surplus to consumers.   All consumers and producers are made better off.   There is a transfer of consumer surplus to producers.   All consumers and producers are made worse off.
17 .		Refer to the figure below. The deadweight loss resulting from the price support is caused by:     Increased consumption and reduced production.   Increased production and reduced consumption.   Reduced production only.   Reduced consumption only.
18 .		Refer to the figure below. After the government bans sugar imports:     Domestic producers earn a smaller surplus than before the ban.   Domestic consumers earn a smaller surplus than before the ban.   Both domestic consumers and domestic producers are made worse off.   All of the above.
19 .		Refer to the figure below. According to the figure, minimum wage laws:     Secure more job opportunities for the less skilled and least experienced.   Attract more applicants for work in low-skilled jobs.   Make it easier for those who desperately need jobs to find them.   All of the above.
20 .		Refer to the figure below. In California’s wholesale electricity market:     The effect of deregulation was greater than the effect of higher input prices; therefore, the market price decreased.   The effect of deregulation was exactly offset by the effect of more expensive fuel; therefore, the market price remained the same.   The effect of higher input prices was greater than the effect of deregulation, causing the market price to increase.   Increased competition maintained prices low.