Multiple_choice_from_last_semester_s_exa

Multiple_choice_from_last_semester_s_exa - Econ 002 Spring...

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Econ 002 Spring 2006 Test 1 McLeod Name ___________________________________________________ Part 1—Multiple Choice. Please choose the best response to each of the following questions. (4 points each) 1. Suppose that hamburgers and hot dogs are substitutes. If the price of hamburgers increases, this will most likely _________ the equilibrium price of hot dogs and _________ the equilibrium quantity of hot dogs. A) increase; increase B) increase; decrease C) decrease; increase D) decrease; decrease 2. An increase in the demand for a product will cause the price to ___________ which will cause a change in __________. 3. Suppose a country can produce capital goods or consumer goods. The production possibilities for the country are given in the following table: CONSUMER GOODS CAPITAL GOODS 0 800 100 760 200 700 300 610 400 450 500 250 600 0 If the country is already producing 400 units of consumer goods, what is the opportunity cost of producing an additional 100 units of consumer goods?
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