ECON101 1

# ECON101 1 - U NIVERSITY O F W ATERLOO Department f E...

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UNIVERSITY OF WATERLOO Department of Economics Econ 101 - Test #1 May 18, 2000 1. I Choose the most appropriate response. Which one of the following is not apartof the opportunity cost of attending college? A) Cost of tuition. B) Cost of textbooks. C) Cost of meals. D) Income that could have been earned by workine. E) All of the above. Wanda makes \$20 an hour as a welder. She usually doesn't do anything after work. Today, she must take two hours while travelling home after work to go to the dentist to have a tooth extracted. The dentist charges \$100. The opportunity cost of Wanda's trip to the dentist is A) \$ 140. B) \$ 120. c) \$ 100. D) \$40. E) none of the above. The opportunity cost to a customer for getting a \$ 10 haircut is the A) customer's best alternative use of the \$10. B) customer's best alternative use of the time it takes to get a haircut. C) customer's best alternative use of both the \$ 10 and the time it takes to set a haircut. D) value of \$ 10 to the barber. E) value to the barber of the time it takes to sive a haircut. Marginal cost is A) the cost of an activity. B) the additional cost of a small increase in an activity. c) the additional cost of a small decrease in an activity. D) the change in incentives due to competition. E) none of the above. Scarcity differs from poverty because A) scarcity is everywhere. B) wants exceed resources even for the rich. C) the rich do not have to make choices. D) the poor do not have any choices. E) none of the above. 2. ) a ') t 4. -) 5. ) Economics 101 -

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6. 4 1,,'," "The rich should face higher income tax rates than the poor." This is an example of A) a normative statement. B) a positive statement. Cf a negative statement. D) economic reasoning. E) neither a normative nor a positive statement. Figure 3.3 A Gsad X 7. Figure 3.3 illustrates Mary's production possibility frontier. If Mary wants to move from point b to point c, A) it will be necessary to improve
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## This note was uploaded on 12/19/2011 for the course ECON 101 taught by Professor Vanderwaal during the Fall '08 term at Waterloo.

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ECON101 1 - U NIVERSITY O F W ATERLOO Department f E...

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