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Econ_Sample_Exam

# Econ_Sample_Exam - ARE 201 Sample Final Exam Topics...

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ARE 201 Sample Final Exam Topics: Chapters 1—12 MULTIPLE CHOICE (2 points each) 1. When the government redistributes income from the rich to the poor, a. efficiency is improved, but equity is not. b. both rich people and poor people benefit directly. c. people work less and produce fewer goods and services. d. rich people consume fewer goods , but poor people consume more goods, resulting in no real change. 2. The art of scientific thinking includes a. knowing how the major organs of the human body work. b. understanding every scientific field—physics, biology and economics. c. deciding which assumptions to make. d. being able to mathematically express natural forces. Labor Hours Needed to Make 1 Pound of: Pounds produced in 40 hours: Meat Potatoes Meat Potatoes Farmer 8 2 5 20 Rancher 4 5 10 8 3. According to the table, the opportunity cost of 1 pound of meat for the farmer is 4. A market is a 5. When the price of kittens was \$25 each, the pet shop sold 20 per month. When they raised the price to \$35 each, they sold 14 per month. The elasticity of demand for kittens would be 6. With a binding price floor the market price will a. be lower than the price floor. b. be higher than the price floor. c. equal the price floor. d. It is impossible to compare the market price with the price floor. 1

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BUYER WILLINGNESS TO PAY MIKE \$50.00 SANDY \$30.00 JONATHAN \$20.00 HALEY \$10.00 7. If the table represents the willingness to pay of 4 buyers and the price of the product is \$15, then who would be willing to purchase the product? Assume that Tammy cleans Ryan’s house weekly for \$80. Ryan would be willing to pay as much as \$100 weekly to have his house cleaned. Tammy’s opportunity cost is \$70.
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Econ_Sample_Exam - ARE 201 Sample Final Exam Topics...

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