econ 211 test 1 answers

Econ 211 test 1 - Econ 211 Patrick McLaughlin ANSWER KEY Test 1 Choose the correct answer to each question and fill in the corresponding bubble on

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Econ 211 ANSWER KEY Patrick McLaughlin Test 1 : Choose the correct answer to each question and fill in the corresponding bubble on your answer sheet. There is only one answer to each question. There are 25 questions total; you have until the end of the period to finish. Good luck. 1. If you are currently answering questions at a speed such that the marginal benefits of speed are equal to the marginal costs of speed, then a. You should speed up, because otherwise you might run out of time b. You should slow down because otherwise you might get tired before the end of the exam c. No other speed will yield higher net benefits d. You should go faster because you have nothing to lose by doing so e. Both (b) and (d) are correct 2. Ceteris paribus, an increase in the your income will cause a. Demand for a normal good to fall b. Demand for a normal good to rise c. Demand for an inferior good to rise d. The price of a good to rise e. None of the above 3. The law of demand tells us that a. the lower the price of a good, the lower will be the demand for it b. the higher the price of a good, the lower will be the demand for it c. the lower the price of a good, the higher will be the demand for it d. both b. and c. e. none of the above 4. Assume gloves and bats are complements. If a reduction in the supply of gloves causes a rise in the price of gloves, this will cause a. a reduction in the demand for bats b. an increase in the supply of gloves c. a reduction in the quantity of gloves demanded d. a rise in net benefit to consumers in the glove market e. both a. and c. are correct 5. A store remains open from 8 am to 4 pm each weekday. The store owner is considering staying open an extra hour each evening. The owner’s marginal benefit a. is the benefit the owner receives from staying open from 8 am to 5 pm b. depends on the revenues the owner makes during the day c. must be greater than or equal to the owner’s marginal cost if the owner decides to stay open d. is equal to revenues minus operating costs e. only (a) and (c) are correct 6. During the summer you have made the decision to attend summer school, which stops you from working at your usual summer job that pays $6,000 for the summer. Your tuition cost is $3,000, books cost $300, and room and board cost $1,000. According to economics, the total cost of attending summer school is a. $14,300 b. $10,300 c. $6,000 d. $4,300 e. $3,300 1
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Questions 7-10 are based on the following information. Suppose the marginal benefits and marginal costs of studying various numbers of hours for this test are shown below. All benefits and costs are measured in
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This note was uploaded on 04/09/2008 for the course ECON 211 taught by Professor Johnson during the Spring '07 term at Clemson.

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Econ 211 test 1 - Econ 211 Patrick McLaughlin ANSWER KEY Test 1 Choose the correct answer to each question and fill in the corresponding bubble on

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