* not completed

. Which best describes consumer surplus?

The price consumers are willing to pay for a unit correct incorrect

The cost of providing a unit correct incorrect

The profits made by a firm correct incorrect

The difference between the price a consumer pays for an item and the price he/she is willing to pay for it correct incorrect

* not completed

. Which of the following statements is NOT true?
In the free market changes in the price of a product:

Can act as a signal to producers correct incorrect

Can provide an incentive to reallocate resources correct incorrect

Can act as a rationing device correct incorrect

Is set by the government correct incorrect

* not completed

. Community surplus equals:

Producer surplus minus consumer surplus correct incorrect

Profits plus utility correct incorrect

Total utility minus plus profit correct incorrect

Consumer surplus plus producer surplus correct incorrect

* not completed

. Monopoly power in a market is likely to:

increase consumer surplus correct incorrect

increase community surplus correct incorrect

lead to higher producer surplus correct incorrect

lead to lower prices and lower output correct incorrect

* not completed

. A negative production externality means:

The social marginal cost is greater than the private marginal cost correct incorrect

The social marginal benefit is greater than the private marginal cost correct incorrect

The social marginal cost is greater than the private marginal benefit correct incorrect

The social marginal cost is less than the private marginal cost correct incorrect

* not completed

. A positive consumption externality occurs when:

The social marginal cost is greater than the private marginal cost correct incorrect

The social marginal benefit is greater than the private marginal benefit correct incorrect

The social marginal cost is greater than the private marginal benefit correct incorrect

The social marginal cost is less than the private marginal cost correct incorrect

* not completed

. A merit good:

Is a public good correct incorrect

Involves a negative externality correct incorrect

Is overprovided in the free market correct incorrect

Is underprovided in the free market correct incorrect

* not completed

. A demerit good:

Is a public good correct incorrect

Involves a positive externality correct incorrect

Is overprovided in the free market correct incorrect

Is underprovided in the free market correct incorrect

* not completed

. A public good will probably:

Be expensive in a free market correct incorrect

Be overprovided in the free market correct incorrect

Not be provided in the free market correct incorrect

Has no opportunity cost correct incorrect

* not completed

. Asymmetric information occurs when:

Information is free correct incorrect

Buyers and sellers have access to different information correct incorrect

Community surplus is maximized correct incorrect

Community surplus is minimized correct incorrect