# 1 - Ecn 1B Answer Key Problem set#1 1 When y changes x...

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Ecn 1B Answer Key: Problem set #1 1. When y changes, x stays the same. The line depicting this relationship would be a. Vertical b. Horizontal c. Linear with a negative slope d. Linear with a positive slope Answer: (a) Vertical lines have the relationship where y changes but x stays the same. For example, let us consider the vertical line x=2. Two points on this line are (2,1) and (2, 45). Both these points have an x value of 2; but the points have different y values. 2. Because total income in the United States has increased over time, everyone's total income has increased as well. This incorrect argument is an example of 3. Misty has the option of purchasing one of three products: Brand A, Brand B, or Brand C. Each costs ten dollars. If she decides that Brand A meets her needs best, then the opportunity cost of this decision is a. Brand B plus Brand C b. Twenty dollars c. Brand A d. Brand B or Brand C, depending on which is considered the highest- value alternative forgone. Answer: (d) Opportunity cost of something is the highest-valued alternative that we give up to get it. So the brand Misty considers to be the highest –value alternative is the opportunity cost of the decision.

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4. In the above figure, x is y. To find the relationship between z and x, we have to keep y constant. Let us pick y= 3. Then for this value for y, we will find that when z=3, x=2 and when z=4, x=4 (approximately). Thus when z increases from 3 to 4, x also increases from 2 to 4. So x is positively related to z.
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