Exam 1: Economics: Foundations and Models

Which of the following is motivated by an equity concern?

Trade-offs force society to make choices when answering what three fundamental questions?

Scenario 1-3 Suppose a t-shirt manufacturer currently sells 5,000 t-shirts per week and makes a profit of $10,000 per week. A manager at the plant observes, "Although the last 400 t-shirts we produced and sold increased our revenue by $4,000 and our costs by $4,800, we are still making an overall profit of $10,000 per week so I think we're on the right track. We are producing the optimal number of t-shirts." -Refer to Scenario 1-3. Had the firm not produced and sold the last 400 t-shirts, would its profit be higher or lower, and if so by how much?

Table 1-3 Santiago runs a comic book store in the town of East Arbor. He is debating whether he should extend his hours of operation. Santiago figures that his sales revenue will depend on the number of extra hours the store is open as shown in the table above. He would have to hire a worker for those extra hours at a wage rate of $18 per hour. -Refer to Table 1-3. What is Santiago's marginal benefit if he decides to stay open for an extra two hours instead of one hour?

Zane's Vanes is a service that restores old weather vanes. Zane has just spent $125 purchasing a 1920s-era weather vane which he expects to restore and sell for $500 once the work is completed. After having spent $125, Zane realizes that he will need to spend an additional $200 on materials to complete the restoration. Alternatively, he can sell the weather vane without restoring it for $200. What is his marginal benefit if he sells the weather vane without restoring it?

In economics, the practical application of an invention is known as

The additional cost to a producer of hiring an additional unit of labor is called the marginal cost.

Marginal benefit is the benefit that your activity provides to someone else.

Which of the following is an example of a "how much" decision?

Which of the following statements is true about profit?

Billie's Billiard Barn has seen its business slow down ever since Patti's Ping Pong Parlour opened up across the street. Since the opening of Patti's Ping Pong Parlour, the opportunity cost of shooting pool at Billie's Billiard Barn has ________ for Billie's customers who also like to play ping pong.

Which of the following is a positive economic statement?

Scarcity refers to a situation in which unlimited wants exceed the limited resources available to fulfill those wants.

When Mr. Peabody decides on the companies to which he will donate his time and money, a ________ issue is being addressed.

Which of the following are primarily macroeconomic topics and which are primarily microeconomic topics? a. college tuition rates b. farm subsidies c. national income d. automobile prices e. air traffic congestion f. economic recession

Damian shares a small food truck with his sister. His share of the expenses is $500 per month. He has decided to get his own, newer food truck which he will not have to share with anyone. His expenses for the newer truck are $1,400 per month. Damian is as rational as any other person. As an economics major, you rightly conclude that

What is voluntary exchange?

What is the difference between accounting profit and economic profit?

In 2017, Peelville consumed 30,000 bananas. In 2018, banana consumption rose to 35,000. Calculate the percentage change in banana consumption.

If it costs Vijay $150 to design 5 Web sites and $175 to design 6 Web sites, then $175 is the marginal cost of producing the 6th Web site.