ECON_002_QUIZ___2_1_

# ECON_002_QUIZ___2_1_ - ECON 002 QUIZ 2 SU 07 Student 1 Your...

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ECON 002 QUIZ # 2 SU 07 Student: ___________________________________________________________________________ 1. Your neighbors have asked you to look after their dog while they are on vacation. It will take you one hour per day to feed, walk, and care for the dog, which you can do either before or after you go to work. Your regular job pays \$10 per hour, and you can work for up to eight hours per day. Your reservation price for taking care of the neighbor's dog is A. \$10, because that is your opportunity cost of one hour of work. B. \$15, because overtime wages are generally equal to 1.5 times your regular wage when you work more than eight hours in one day. C. zero, because your regular job is not available for the ninth hour of work. D. the value of one hour of leisure, which is greater than zero. E. the value of one hour of leisure, which is less than zero. 2. Why are you more likely to see a poor person picking up aluminum cans than a wealthy person? A. Wealthy people care less about the environment. B. Poor people have more spare time to spend protecting the environment. C. Wealthy people have higher opportunity costs for their time. D. Wealthy people are more concerned about their public image. E. Wealthy people are more likely to be aware of diseases that are transmitted through litter. Question 3 information: Melissa is trying to decide how to divide her time between her jobs as a night- receptionist in the dormitory, which pays \$9/hr for as many hours as she chooses to work, and typing papers for the students. She makes \$2 for every paper she types. Melissa is indifferent between the two tasks, and the number of papers she can type depends on how many hours she types a day, as shown in the table below: 1

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receptionist. A. \$1 B. \$6 C. \$11 D. \$16 E. \$20 4. As the market price of a service increases, more people will decide to perform that service because A. higher prices always result in higher revenue. B. more people will find that the market price exceeds their reservation price. C. higher-priced services are more prestigious. D. service jobs are in higher demand than manufacturing jobs. E. it is proof that the supply curve has shifted to the right. 5. The primary objective of most private firms is to A. maximize revenue. B. maximize profit. C. minimize cost. D. maximize output. E. minimize input. 6. A price taker confronts a demand curve that is A. vertical at the market price. B. upward sloping. C. downward sloping. D. horizontal at the market price. E. elastic. 7. In general, if the price of a fixed factor of production decreases, A. the profit maximizing level of output falls. B. profits of the firm become larger or losses become smaller.
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## This note was uploaded on 03/30/2008 for the course ECON 002 taught by Professor Mcleod,markpehlivan,ayseozg during the Summer '08 term at Penn State.

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ECON_002_QUIZ___2_1_ - ECON 002 QUIZ 2 SU 07 Student 1 Your...

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