# Craig is happy to purchase three dvds at 15 each

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Craig is happy to purchase three DVDs at \$15 each. Sarah is willing to pay the \$60 ticket price for an upcoming concert, but is happy to buy a ticket from her roommate for \$45. Sam decides not to purchase a new bicycle until the price falls by \$10. The price of movie tickets falls and Ralph takes his entire family to the movies. CONCEPT Market Equilibrium 8
Josh is a hockey player on his university's team. He practices four times a week with his team and sometimes attends Friday night open skate with his friends. If Josh decides to attend the Friday night skate, the cost is \$5. Which of the following is economically true regarding Josh's decision to join his friends on Friday night?
Josh should never attend Friday night open skate--he could get hurt and jeopardize his hockey career. If Josh decides to join his friends, he must feel that he gains at least \$5 in fun by attending a fifth weekly session on the ice. Josh will only attend Friday night skate if there is no charge, a fifth time skating will not benefit him at all. Since Josh already skates four times a week with his hockey team, he will never choose to skate a fifth time that week. CONCEPT Cost and Benefit Optimization for Consumers 9 A store devotes more space to bicycles so it now has less space for books. This is an example of what decision-making relationship for the rational firm? Infinite resources Opportunity cost Cost minimization Profit maximization CONCEPT Decision Making Relationships: Rational Firm 10 Joe paid \$5,000 for a used car, but he was willing to pay as much as \$10,000. Which economic concept below corresponds to the example above?
Deadweight loss Producer surplus Ceteris paribus CONCEPT Market Equilibrium 11 Determine which definition below corresponds with ceteris paribus? An increase in income will cause consumers to purchase more normal goods. The S curve is upward sloping. A negative advertisement will cause consumers to purchase less of the good.