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Micro1 - Sample Exam

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©Prep101 www.prep101.com/freestuff Page 1 of 21 Practice Micro Exam Q1. Last year CD-players were selling for $30 and MP3-players were selling for $40. David bought himself a CD-player for $30. Now CD-players sell for $50 and MP3- players sell for $55. David’s friend offers him $50 for the CD-player. What is David’s opportunity cost if he decides to keep the CD-player? a) $55 b) $30 c) $40 d) $50 e) $55 Q2. Dennis is self-employed and earns $30,000 a year. His total business expenses are $5,000. Dennis was offered a job at the local restaurant for $15,000 a year, but he turned down the offer. The economic profit Dennis gets from being self-employed is Q3. Robert can produce either 2 units of good A or 2 units of good B in an hour, while Raymond can produce either 2 units of good A or 4 units of good B in an hour. What would be the total output of goods A and B in an 8-hour day if Raymond and Robert each specialized in producing the good for which they have a comparative advantage?
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