Question 1

The additional or incremental cost associated with a choice is known as

Accepted Answer

A) the marginal cost 
B) the marginal benefit 
C) marginal utility 
D) utility 
A) the marginal cost 
B) the marginal benefit 
C) marginal utility 
D) utility A

Question 2

The difference between the earnings that a firm receives from selling its good or service and the costs of production for the good or service is the

Accepted Answer

A) marginal benefit 
B) opportunity cost 
C) utility 
D) profit 
A) marginal benefit 
B) opportunity cost 
C) utility 
D) profit D

Question 3

The law of increasing marginal costs states that

Accepted Answer

A) Ceteris paribus, as more and more of an activity are done; the additional costs of the activity tend to decrease. 
B) Ceteris paribus, as more and more of an activity are done; the additional costs of the activity tend to increase. 
C) Ceteris paribus, as more and more of an activity are done; the additional benefits of the activity tend to decrease. 
D) Ceteris paribus, as more and more of an activity are done; the additional benefits of the activity tend to increase. 
A) Ceteris paribus, as more and more of an activity are done; the additional costs of the activity tend to decrease. 
B) Ceteris paribus, as more and more of an activity are done; the additional costs of the activity tend to increase. 
C) Ceteris paribus, as more and more of an activity are done; the additional benefits of the activity tend to decrease. 
D) Ceteris paribus, as more and more of an activity are done; the additional benefits of the activity tend to increase. B

Question 4

You are considering buying a new laptop.The economic way of thinking suggests that you will buy the laptop if

Accepted Answer

A) total benefits is greater than total costs 
B) your income is above average 
C) the marginal cost of is less than the marginal benefit for the laptop. 
D) the marginal benefit is greater than the marginal cost of the laptop. 
A) total benefits is greater than total costs 
B) your income is above average 
C) the marginal cost of is less than the marginal benefit for the laptop. 
D) the marginal benefit is greater than the marginal cost of the laptop.

Question 5

Consider the data in Table 2.What is the net benefit for the third app purchased? Table SEQ Table 2: Total Benefits and Total Costs for Apps
$$\begin{array} { | c | c | c | } 
\hline \text { Nurnber of Apps } & \text { Total Berafit } \$ \text { ) } & \text { Total Costs } \$ \text { ) } \
\hline 1 & 20 & 15 \
\hline 2 & 50 & 30 \
\hline 3 & 70 & 45 \
\hline 4 & 85 & 60 \
\hline
\end{array}$$

Accepted Answer

A) $25 
B) $20 
C) $15 
D) $10 
A) $25 
B) $20 
C) $15 
D) $10

Question 6

Explain how the concepts of scarcity and opportunity cost are related.

Accepted Answer

The inputs of production, or resources,

Question 7

Decisions made "at the margin" require

Accepted Answer

A) comparing the benefits and costs of the next, or incremental, of consuming a good or service 
B) comparing the total benefits and costs of a consuming a good 
C) comparing the total benefits and the net costs of consuming a good 
D) comparing the net benefits and total costs of consuming a good 
A) comparing the benefits and costs of the next, or incremental, of consuming a good or service 
B) comparing the total benefits and costs of a consuming a good 
C) comparing the total benefits and the net costs of consuming a good 
D) comparing the net benefits and total costs of consuming a good

Question 8

You and a friend decide to go to a concert and you purchase a ticket for $50.Your manager calls and asks you to work that evening for four hours.You earn $9.50 per hour.What is the value of the opportunity cost of working?

Accepted Answer

The answer of You and a friend decide to go...

Question 9

Explain how microeconomics affects macroeconomics.

Accepted Answer

While macroeconomics focuses o

Question 10

Which of the following would be a focus of macroeconomics?

Accepted Answer

A) The study of how individuals make a decision. 
B) The study of how businesses make a profit. 
C) The study of how the price for a product is determined. 
D) The study of changes of price levels in an economy 
A) The study of how individuals make a decision. 
B) The study of how businesses make a profit. 
C) The study of how the price for a product is determined. 
D) The study of changes of price levels in an economy

Question 11

________________ is a synonym for satisfaction or happiness.

Accepted Answer

A) Marginal cost 
B) Opportunity cost 
C) Utility 
D) Scarcity 
A) Marginal cost 
B) Opportunity cost 
C) Utility 
D) Scarcity

Question 12

The concept of ____________________ is used to isolate important relationships.

Accepted Answer

A) opportunity cost 
B) marginal benefit 
C) ceteris paribus 
D) diminishing marginal cost 
A) opportunity cost 
B) marginal benefit 
C) ceteris paribus 
D) diminishing marginal cost

Question 13

Your second glass of water on a hot summer day will

Accepted Answer

A) increase total utility and decrease marginal utility 
B) decrease total utility and decrease marginal utility 
C) increase total utility and increase marginal utility 
D) decrease total utility and increase marginal utility 
A) increase total utility and decrease marginal utility 
B) decrease total utility and decrease marginal utility 
C) increase total utility and increase marginal utility 
D) decrease total utility and increase marginal utility

Question 14

Because of the concept of scarcity

Accepted Answer

A) choices need to be made 
B) marginal benefits increases 
C) marginal costs decrease 
D) total returns of benefit remains unchanged 
A) choices need to be made 
B) marginal benefits increases 
C) marginal costs decrease 
D) total returns of benefit remains unchanged

Question 15

The opportunity cost of consuming more today is

Accepted Answer

A) less production of goods in the future 
B) less consumption of goods in the future 
C) more production of goods in the future 
D) more consumption of goods in the future 
A) less production of goods in the future 
B) less consumption of goods in the future 
C) more production of goods in the future 
D) more consumption of goods in the future

Question 16

A _______________ is a cost that, once incurred, cannot be recovered.

Accepted Answer

A) marginal cost 
B) diminishing cost 
C) sunk cost 
D) incremental cost 
A) marginal cost 
B) diminishing cost 
C) sunk cost 
D) incremental cost

Question 17

Which of the following is true?

Accepted Answer

A) Net benefit = total benefit - total cost 
B) Net benefit = total cost - total benefit 
C) Net benefit = total cost + total benefit 
D) Net benefit = total benefit/total cost 
A) Net benefit = total benefit - total cost 
B) Net benefit = total cost - total benefit 
C) Net benefit = total cost + total benefit 
D) Net benefit = total benefit/total cost

Question 18

You and a friend decide to go to a concert and you purchase a ticket for $50.Your manager calls and asks you to work that evening for four hours.You earn $9.50 per hour.What is the value of the opportunity cost of going to the concert?

Accepted Answer

$38. 
$9.5

Question 19

In the following table, the marginal benefits for the 3rd malt is Table SEQ Table 1: Marginal and Total Benefit for Chocolate Malts
$$\begin{array} { | c | c | c | } 
\hline \begin{array} { c } 
\text { \# of Chocolate } \
\text { Malts }
\end{array} & \text { Margiral Benefits } & \begin{array} { c } 
\text { Total } \
\text { Benefits }
\end{array} \
\hline 1 & \$ 6.00 & \
\hline 2 & \$ 5.00 & \$ 11.00 \
\hline 3 & & \$ 15.00 \
\hline 4 & \$ 3.00 & \
\hline 5 & & \$ 20.00 \
\hline
\end{array}$$

Accepted Answer

A) $1.00 
B) $4.00 
C) $5.00 
D) $15.00 
A) $1.00 
B) $4.00 
C) $5.00 
D) $15.00

Question 20

Consider the data in Table 2.How many apps would satisfy the marginal decision rule?

Accepted Answer

A) 1 
B) 2 
C) 3 
D) 4 
A) 1 
B) 2 
C) 3 
D) 4

Exam 1: An Introduction to the Economic Way of Thinking

The additional or incremental cost associated with a choice is known as

The difference between the earnings that a firm receives from selling its good or service and the costs of production for the good or service is the

The law of increasing marginal costs states that

You are considering buying a new laptop.The economic way of thinking suggests that you will buy the laptop if

Consider the data in Table 2.What is the net benefit for the third app purchased? Table SEQ Table 2: Total Benefits and Total Costs for Apps Nurnber of Apps Total Berafit \ ) Total Costs \ ) 1 20 15 2 50 30 3 70 45 4 85 60

Explain how the concepts of scarcity and opportunity cost are related.

Decisions made "at the margin" require

You and a friend decide to go to a concert and you purchase a ticket for $50.Your manager calls and asks you to work that evening for four hours.You earn $9.50 per hour.What is the value of the opportunity cost of working?

Explain how microeconomics affects macroeconomics.

Which of the following would be a focus of macroeconomics?

________________ is a synonym for satisfaction or happiness.

The concept of ____________________ is used to isolate important relationships.

Your second glass of water on a hot summer day will

Because of the concept of scarcity

The opportunity cost of consuming more today is

A _______________ is a cost that, once incurred, cannot be recovered.

Which of the following is true?

You and a friend decide to go to a concert and you purchase a ticket for $50.Your manager calls and asks you to work that evening for four hours.You earn $9.50 per hour.What is the value of the opportunity cost of going to the concert?

In the following table, the marginal benefits for the 3rd malt is Table SEQ Table 1: Marginal and Total Benefit for Chocolate Malts \# of Chocolate Malts Margiral Benefits Total Benefits 1 \ 6.00 2 \ 5.00 \ 11.00 3 \ 15.00 4 \ 3.00 5 \ 20.00

Consider the data in Table 2.How many apps would satisfy the marginal decision rule?

Production Possibilities

Demand Supply

Consumer Surplus, Producer Surplus, and Economic Efficiency

Elasticity

Measuring Economic Activity

Inflation and the Measurement of Prices

The Power and Limits of Markets

Wage Determination and Superstar Salaries

The Minimum Wage

International Trade of Goods

Immigration and the International Trade of Labor

Foreign Exchange and the International Trade of Money

Farm Policy

The Economics of Illegal Drugs

Pollution, the Environment, and Global Warming

The Economics of Education

Competition and Monopoly

The Economics of Labor Market Discrimination

Poverty and the Distribution of Income

The Economics of Health Care

Monetary Policy and the Federal Reserve

Fiscal Policy and the Federal Budget

Filters

In the following table, the marginal benefits for the 3^rd malt is Table SEQ Table 1: Marginal and Total Benefit for Chocolate Malts \# of Chocolate Malts Margiral Benefits Total Benefits 1 \ 6.00 2 \ 5.00 \ 11.00 3 \ 15.00 4 \ 3.00 5 \ 20.00