Exam 1: The Principles and Practice of Economics

Maria has to choose between driving and taking a train to destination A. Traveling by train will cost her $400 and will take 4 hours. Driving to destination A takes 6 hours, and the required amount of gasoline costs $250. Her opportunity cost of time is $15 per hour. -Refer to the scenario above.Maria should choose to ________.

A consumer has $50 to spend.He has to decide between buying two goods: magazines priced at $5 each and DVDs priced at $10 each.Which of the following combinations of the two goods will entirely exhaust his budget constraint?

Which of the following is NOT a key principle of economics?

Which of the following is an example of a normative economic statement?

If Tom spends 4 hours a day on Facebook,and the minimum wage in his country is $7 per hour. a)What is his opportunity cost of spending time on Facebook? b)Given that spending time on Facebook has an opportunity cost,does this analysis suggest that Tom should work rather than spend his time on social networking?

________ is a calculation that adds up the costs and benefits using a common unit of measurement,like dollar values.

________ is the study of an economy as a whole.

Which of the following is an example of a positive economic statement?

Which of the following is a topic studied by microeconomists?

John has to choose between two jobs: one that offers him $50 per hour and one that offers him $35 per hour.The opportunity cost of choosing the job that offers him $50 per hour is ________.

Positive economics is descriptive because ________.

Define opportunity cost.A student who has just graduated from college has three job offers: the first job pays $35,000 a year,the second job pays $23,000 a year,and the third one pays $15,000 a year.What is the student's opportunity cost of taking the first job?

________ is analysis that generates objective descriptions or predictions about the world that can be verified with data.

A recent news report stated that the unemployment rate in the country of Lithasia had increased from 10.2 percent to 18.2 percent between 2003 and 2013 and that the government has adopted strict fiscal measures to expand employment.Would this report be considered microeconomic or macroeconomic analysis?

Which of the following statements correctly differentiates between positive and normative economics?

Cost-benefit analysis requires ________.

Which of the following statements is true of economic reasoning?

Which of the following will hold true if the market for cameras is in equilibrium at a price of $40?

Which of the following statements is true?

Out of a set of feasible alternatives,an optimizer should choose the alternative with the ________.