Test_1micro

Test_1micro - TEST 1 MAX. GRADE: 150 points Choose only 40...

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TEST 1 MAX. GRADE: 150 points Choose only 40 questions. Each question 3.75 points. 1) Economics is the study of A) how to invest in the stock market. B) how society uses limited resources. C) the role of money in markets. D) how government officials decide which goods and services are produced. Answer: B 2) Deciding how a society's products are distributed among its citizens answers the economic question of A) who consumes the products produced. B) what products will be produced. C) where will the products be consumed. D) how will the products be produced. Answer: A 3) A variable measures A) something that always has the same value. B) something that can take on different values. C) factors that occur with high degrees of uncertainty. D) the degree to which something varies over time. Answer: B 4) To think at the margin means to consider A) how nothing remains constant over time. B) how a small change in one variable affects another variable. C) how people behave in their own self-interest. D) how people will decide what to purchase. Answer: B 5) We can use macroeconomic analysis to A) learn how to balance a checkbook. B) study the choices made by households. C) understand marginal changes in the macroeconomy. D) understand why economies grow. Answer: D 6) Suppose that you own a house. What is the opportunity cost of living in the house? A) There is no opportunity cost because you own the house. B) There is no opportunity cost unless you could set up a business in the house. C) The opportunity cost is the rent you could have received from a tenant if you didn't live there. D) The opportunity cost is the cost of your monthly mortgage payment plus bills.
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Answer: C Figure 2.1 7) Refer to Figure 2.1. If you choose to produce only agricultural products, what is the maximum quantity you can produce per year? A) 200 tons B) 400 tons C) 600 tons D) > 600 tons Answer: D 8) Refer to Figure 2.1. What is the opportunity cost of increasing production of manufactured products from 500 tons to 600 tons per year? A) 200 tons of agricultural products per year B) 400 tons of agricultural products per year C) 500 tons of agricultural products per year D) 600 tons of agricultural products per year Answer: A 9) The marginal principle implies that an individual should produce or consume where A) marginal benefit exceeds marginal cost. B) marginal benefit is less than marginal cost. C) marginal benefit equals marginal cost. D) total benefit equals total cost. Answer: C Hours of Operation Marginal Cost 1 6 2 12 3 18
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4 24 5 30 6 36 7 42 Table 2.2 10) Krystal runs a nail salon and needs to decide how many hours to stay open. Table 2.2 illustrates her marginal costs of staying open for each additional hour. Suppose that Krystal's marginal benefit of staying open per hour is $30. If she is following the marginal principle, how many hours should Krystal stay open? A) 4 hours
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This document was uploaded on 03/30/2012.

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Test_1micro - TEST 1 MAX. GRADE: 150 points Choose only 40...

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