The adage, "There is no such thing as a free...

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ECON 2020-100 Midterm 1 Principle of Macroeconomics Feb 7 th , 2014 Version B Take a deep breath and relax. Every question can be answered with knowledge we learnt from the lecture. There are 25 multiple choice questions. Please indicate your answer on the scantron with a No. 2 pencil. Make sure that you mark your student ID number correctly on the scantron! 5 points will be deducted if you fail to do so. Good Luck!
1. The adage, "There is no such thing as a free lunch," is used to illustrate the principle that
2. Ed spends an hour studying instead of watching tv with his friends. The opportunity cost to him of studying is
3. Caroline eats two bananas during a particular day. The marginal benefit she enjoys from eating the second banana
4. Assume Diana buys computers in a competitive market. It follows that a. Diana has a limited number of sellers to turn to when she buys a computer. b. Diana will find herself negotiating with sellers whenever she buys a computer. c. if Diana buys a large number of computers, the price of computers will rise noticeably. d. None of the above is correct.

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