sample test microeconomics

sample test microeconomics - 1 Forest is a mountain man...

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1. Forest is a mountain man living in complete isolation in Montana. He is completely self- sufficient through hunting, fishing, and farming. He has not been in the city to buy anything in five years. One can infer A) the scarcity principle does not apply to Forest. B) Forest is not required to make choices. C) the scarcity principle still applies because more hunting means less fishing and farming. D) Forest is very satisfied. E) Forest is not rational. 2. The 7 th glass of soda that Tim consumes will produce an extra benefit of 10 cents and has an extra cost of zero (Tim is eating at the cafeteria). The cost-benefit principle predicts that Tim will A) realize he has had too much soda to drink and go home. B) drink the 7 th glass and continue until the marginal benefit of drinking another glass of soda is zero. C) volunteer to empty out the fountain. D) not drink the 7 th glass. E) flip a coin to decide. 3. Jen spends her afternoon at the beach, paying $1 to rent a beach umbrella and $11 for food and drinks rather than spending an equal amount of money to go to a movie. The opportunity cost of going to the beach is: A) zero, because the money she spent was for food, drinks and an umbrella rather than to enter the beach. B) the $12 she spent on the umbrella, food and drinks. C) only $2 because she would have spent the money on food and drinks whether or not she went to the beach. D) the movie she missed seeing. E) the movie she missed seeing plus the $12 she spent on the umbrella, food and drinks. 4. Suppose Mary is willing to pay up to $15,000 for a used Ford pick-up truck, but she finds one for $12,000. Her __________ is __________. A) benefit; $12,000 D) economic surplus; $12,000 B) cost; $15,000 E) economic surplus; $0 C) economic surplus; $3,000 Use the following to answer questions 5-6: Shoes Per Hour Pants Per Hour Jenny 3 2 Craig 4 3 5. According to the data, Jenny has an absolute advantage in 6. Jenny's opportunity cost of producing an extra pair of pants is 7. Once a country has acquired a comparative advantage Cars
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1,000 50,000 Tons of Agricultural Products
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