exam 1b - ECON 210 Exam #1 Pink Fall 2009 (Practice Exam...

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Econ 210 Page 1 of 11 Fall 2009 Exam 1 Pink ECON 210 Exam #1 Pink Fall 2009 (Practice Exam #1B for Fall 2010) 1. “Income is not distributed equally enough,” is an example of a statement associated with a. normative economics b. positive economics c. price theory d. economic cost 2. Which of the following is an example of the economic resource of capital? a. a $50 U.S. government savings bond b. a new office building for a biotechnology firm c. a computer programmer d. oil 3. Because resources are scarce, a. the opportunity cost of using economic resources is zero b. the value of economic resources is zero c. there are more than enough resources available to expand production of all goods indefinitely d. using a resource to produce one good makes it unavailable to produce a different good 4. Which of the following are irrelevant to decision making? a. implicit costs b. sunk costs c. explicit costs d. opportunity costs 5. If John has 4 equivalent job offers in the same city for $50,000; $60,000; $70,000; and $90,000, what is his opportunity cost of taking the job paying $60,000 a year? a. $30,000 b. $50,000 c. $70,000 d. $90,000 6. John’s cost of taking the $60,000 a year job (based on the information in the previous problem) is an example of a. an explicit cost b. an implicit cost c. a sunk cost d. a lack of scarce resources 7. What is opportunity cost?
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Econ 210 Page 2 of 11 Fall 2009 Exam 1 Pink a. the maximum level of output that can be produced with any scarce resource b. the monetary cost of a good or service c. the value of the best alternative forgone d. consumer surplus 8. The table below shows the maximum quantity of beer and peanuts that John and Kate can produce in one day. Based on this information, which of the following statements is true? Beer Peanuts John’s production 20 20 Katie’s production 10 30 a. John has absolute advantage in producing peanuts b. Katie has absolute advantage in producing beer. c. John has comparative advantage in producing peanuts d. Katie has comparative advantage in producing peanuts 9. If John’s production possibilities are illustrated on a graph, what is the slope of his production possibility frontier? (Assume that the quantity of peanuts John can produce is measured on the x axis.) a. -3 b. -1 c. -1/3 d. -2 10. If John and Kate work together, which of the following combinations of beer and peanut production would be infeasible? a. 20 beers and 30 peanuts b. 10 beers and 40 peanuts c. 25 beers and 15 peanuts d. 30 beers and 2 peanuts 11. If John and Kate work together, which of the following combinations of beer and peanut production would be efficient? a. 20 beers and 30 peanuts b. 10 beers and 15 peanuts c. 15 beers and 40 peanuts d. 25 beers and 16 peanuts
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Econ 210 Page 3 of 11 Fall 2009 Exam 1 Pink 12. Which of the following point(s) on the economy-wide PPF below represent(s) efficient production? a.
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exam 1b - ECON 210 Exam #1 Pink Fall 2009 (Practice Exam...

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