Micro Economics 08

Micro Economics 08 - Last Name: _ First Name: _ Answer Key...

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Last Name: ___________________ First Name: _______________________ Answer Key ECON 2010 – 100 Principles of Microeconomics Exam # 1-Version A Spring 2008 Section 1. Multiple choice questions: ___1. Which of the following would be an example of opportunity cost? a. Gabriel forgoes the chance to visit the Alamo in order to spend the day on the beach. b. Ryan studies for a molecular biology exam after calling his employer to request time away from work. c. Bill works on the roof of his new home rather than taking time to go fishing. d. All of the above. ___2. For consumers, burritos and hamburgers are substitutes. A rise in the price of a burrito causes ____ in the price of a hamburger and ____ in the quantity of hamburgers. a. a rise; an increase b. a rise; a decrease c. a fall; an increase d. a fall; a decrease ___ 3. Which of the following will not cause a change in the supply for a product (or supply will not shift)? a. a change in the price of other products, the seller could produce. b. a change in technology that allows the firm to produce more. c. a change in the price of the product. d. a change in the price of the inputs needed to produce it. e. a change in expectations that the product’s price will soon increase. ___ 4. Suppose the equilibrium price of microwaves is $100 and the equilibrium quantity is 12,000 units. If the market price of microwaves is $250: a. There will be an excess demand for microwaves. b. There will be an excess supply of microwaves. c. The market will clear (the market is in equilibrium). d. The quantity demanded of microwaves will be more than 12,000 units. e. None of the above. ___ 5. The demand for textbooks is price inelastic. Which of the following would explain this? a. Textbook purchases consume a large portion of most students' income. b. The good is a necessity. c. Students have a lot of time to adjust to price changes. d. Many alternative textbooks can be used as substitutes. e. All of the above. 1
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___ 6. CU-Boulder hopes to raise more revenue by increasing parking fees. This plan will work only if: a. The price effect is larger than the quantity effect (%Δ P > %Δ Q). b. The price effect is smaller than the quantity effect (%Δ P < %Δ Q). c. The price effect and quantity effect are the same (%Δ P = %Δ Q). d. There is no price effect or quantity effect. ___ 7. For which of the following is the cross-price elasticity of demand most likely a large positive number? a. DVD's and milk. b. Hockey pucks and hockey sticks. c. French fries and onion rings. d. All of the above are correct, because the cross-price elasticity is always a positive number. ___ 8. Specialization in production and trade a. Increases the amount of goods and services available in an economy. b.
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Micro Economics 08 - Last Name: _ First Name: _ Answer Key...

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