Question 1

Table 2.3
-Refer to Table 2.3.The marginal product of the 1st worker is

Accepted Answer

A)  100 units of output. 
B)  80 units of output. 
C)  60 units of output. 
D)  40 units of output. 
A)  100 units of output. 
B)  80 units of output. 
C)  60 units of output. 
D)  40 units of output.

Question 2

Increase the level of an activity if its marginal benefit exceeds its marginal cost; reduce the level of an activity if its marginal cost exceeds its marginal benefit.This is known as the ________.

Accepted Answer

The answer of Increase the level of an activity if...

Question 3

Suppose that your tuition to attend college is $5,000 per year and you spend $5,000 per year on room and board.If you were working full time,you could earn $22,000 per year.What is your opportunity cost of attending college?

Accepted Answer

A)  $13,000 
B)  $27,000 
C)  $30,000 
D)  $35,000 
A)  $13,000 
B)  $27,000 
C)  $30,000 
D)  $35,000

Question 4

According to the marginal principle,a rational individual should undertake an economic activity as long as the

Accepted Answer

A)  marginal benefit exceeds marginal cost. 
B)  marginal benefit is less than marginal cost. 
C)  marginal benefit equals marginal cost. 
D)  total benefit equals total cost. 
A)  marginal benefit exceeds marginal cost. 
B)  marginal benefit is less than marginal cost. 
C)  marginal benefit equals marginal cost. 
D)  total benefit equals total cost.

Question 5

What do economists mean when they say that there is "no such thing as a free lunch"?

Accepted Answer

Everything has a cost,even whe

Question 6

Table 2.2
-Julianne runs a business and needs to decide how many hours to stay open.Table 2.2 illustrates her marginal costs of staying open for each additional hour.Suppose that Julianne's marginal benefit of staying open per hour is $24.If she is following the marginal principle,how many hours should Julianne stay open?

Accepted Answer

A)  2 hours 
B)  4 hours 
C)  6 hours 
D)  7 hours 
A)  2 hours 
B)  4 hours 
C)  6 hours 
D)  7 hours

Question 7

As more and more of a variable input is combined with some fixed inputs,additions to the total output decline.

Accepted Answer

A) True 
 B)False

Question 8

Recall the Application about the use of fertilizer and its impact on crop yields to answer the following question(s). The table is taken from this Application.
Fertilizer and Corn Yield
  
-Recall the Application.The table shows the resulting crop yields as bags of applied fertilizer increased.These results show that as more bags of fertilizer were added,holding all other inputs constant,output

Accepted Answer

A)  fell. 
B)  rose but at a declining rate. 
C)  rose but at an increasing rate. 
D)  stayed the same. 
A)  fell. 
B)  rose but at a declining rate. 
C)  rose but at an increasing rate. 
D)  stayed the same.

Question 9

When you have a job and your employer compensates you for your time with money,resulting in both of you being better off,it is an example of a voluntary exchange.

Accepted Answer

A) True 
 B)False

Question 10

Pat claims to save a great deal of money on groceries by traveling to various supermarkets to make her purchases at their advertised sale prices.She might visit as many as five different stores in one day in order to complete her weekly shopping.Her savings are not as great as she may think they are if she does not consider the

Accepted Answer

A)  cost of the gasoline in driving from one store to another. 
B)  mileage she is putting on her car driving from one store to another. 
C)  value of the time she is spending doing the shopping as opposed to other things. 
D)  all of the above 
A)  cost of the gasoline in driving from one store to another. 
B)  mileage she is putting on her car driving from one store to another. 
C)  value of the time she is spending doing the shopping as opposed to other things. 
D)  all of the above

Question 11

Table 2.3
-Refer to Table 2.3.The marginal product of the 3rd worker is

Accepted Answer

A)  100 units of output. 
B)  80 units of output. 
C)  60 units of output. 
D)  40 units of output. 
A)  100 units of output. 
B)  80 units of output. 
C)  60 units of output. 
D)  40 units of output.

Question 12

If the nominal minimum wage is unchanged while prices fall,then the real minimum wage

Accepted Answer

A)  rises. 
B)  falls. 
C)  stays the same. 
D)  is unaffected. 
A)  rises. 
B)  falls. 
C)  stays the same. 
D)  is unaffected.

Question 13

Suppose your bank pays you 5% interest per year on your savings account while prices increase by 3% per year over that time.Approximately how much nominal value do you gain by keeping $100 in the bank for a year?

Accepted Answer

A)  $5 
B)  $2.50 
C)  $2.00 
D)  $0 
A)  $5 
B)  $2.50 
C)  $2.00 
D)  $0

Question 14

Recall the Application about the impact inflation has on your potential future salary and the repayment of student loans to answer the following question(s).
-The Application shows that high inflation results in fewer years to pay back student loans because

Accepted Answer

A)  when inflation is high, the nominal value of the loan increases. 
B)  when inflation is high, the nominal value of wages decreases. 
C)  when inflation is high, the nominal value of the loan decreases. 
D)  when inflation is high, the nominal value of the wages decrease. 
A)  when inflation is high, the nominal value of the loan increases. 
B)  when inflation is high, the nominal value of wages decreases. 
C)  when inflation is high, the nominal value of the loan decreases. 
D)  when inflation is high, the nominal value of the wages decrease.

Question 15

The weekly income earned in 2015 could buy ________ standard baskets of goods and services.

Accepted Answer

A)  1.23 
B)  1.70 
C)  2.22 
D)  2.81 
A)  1.23 
B)  1.70 
C)  2.22 
D)  2.81

Question 16

Figure 2.4
-Joe runs a business and needs to decide how many hours to stay open.Figure 2.4 illustrates his marginal benefit of staying open for each additional hour.Suppose that Joe's marginal cost of staying open per hour is $24.How many hours should Joe stay open?

Accepted Answer

A)  3 hours 
B)  4 hours 
C)  5 hours 
D)  6 hours 
A)  3 hours 
B)  4 hours 
C)  5 hours 
D)  6 hours

Question 17

Figure 2.4
-Joe runs a business and needs to decide how many hours to stay open.Figure 2.4 illustrates his marginal benefit of staying open for each additional hour.Suppose that we observe Joe staying open 5 hours per day.If he is following the marginal principle,what must his marginal cost be?

Accepted Answer

A)  $16 
B)  $24 
C)  $32 
D)  $40 
A)  $16 
B)  $24 
C)  $32 
D)  $40

Question 18

Figure 2.4
-Joe runs a business and needs to decide how many hours to stay open.Figure 2.4 illustrates his marginal benefit of staying open for each additional hour.Suppose that we observe Joe staying open 3 hours per day.If he is following the marginal principle,what must his marginal cost be?

Accepted Answer

A)  $24 
B)  $32 
C)  $40 
D)  $48 
A)  $24 
B)  $32 
C)  $40 
D)  $48

Question 19

Mark quit his job as a salesman where he made $43,000 per year to start his own t-shirt making business.His business expenses are $6,000 per year on rent,$12,000 per year on supplies,and $4,000 per year on part-time help.As for his personal expenses,his apartment costs him $4,800 per year and his personal bills are an extra $1,200 per year.What is Mark's opportunity cost of running the business?

Accepted Answer

A)  $43,000 
B)  $57,000 
C)  $65,000 
D)  $71,000 
A)  $43,000 
B)  $57,000 
C)  $65,000 
D)  $71,000

Question 20

If a consumer can buy four DVDs for $44 and five DVDs for $50,then the marginal cost of the fifth DVD is

Accepted Answer

A)  $50. 
B)  $11. 
C)  $10. 
D)  $6. 
A)  $50. 
B)  $11. 
C)  $10. 
D)  $6.

Table 2.3 -Refer to Table 2.3.The marginal product of the 1st worker is

Increase the level of an activity if its marginal benefit exceeds its marginal cost; reduce the level of an activity if its marginal cost exceeds its marginal benefit.This is known as the ________.

Suppose that your tuition to attend college is $5,000 per year and you spend $5,000 per year on room and board.If you were working full time,you could earn $22,000 per year.What is your opportunity cost of attending college?

According to the marginal principle,a rational individual should undertake an economic activity as long as the

What do economists mean when they say that there is "no such thing as a free lunch"?

As more and more of a variable input is combined with some fixed inputs,additions to the total output decline.

When you have a job and your employer compensates you for your time with money,resulting in both of you being better off,it is an example of a voluntary exchange.

Table 2.3 -Refer to Table 2.3.The marginal product of the 3rd worker is

If the nominal minimum wage is unchanged while prices fall,then the real minimum wage

Suppose your bank pays you 5% interest per year on your savings account while prices increase by 3% per year over that time.Approximately how much nominal value do you gain by keeping $100 in the bank for a year?

Recall the Application about the impact inflation has on your potential future salary and the repayment of student loans to answer the following question(s). -The Application shows that high inflation results in fewer years to pay back student loans because

The weekly income earned in 2015 could buy ________ standard baskets of goods and services.

Figure 2.4 -Joe runs a business and needs to decide how many hours to stay open.Figure 2.4 illustrates his marginal benefit of staying open for each additional hour.Suppose that Joe's marginal cost of staying open per hour is $24.How many hours should Joe stay open?

Figure 2.4 -Joe runs a business and needs to decide how many hours to stay open.Figure 2.4 illustrates his marginal benefit of staying open for each additional hour.Suppose that we observe Joe staying open 5 hours per day.If he is following the marginal principle,what must his marginal cost be?

Figure 2.4 -Joe runs a business and needs to decide how many hours to stay open.Figure 2.4 illustrates his marginal benefit of staying open for each additional hour.Suppose that we observe Joe staying open 3 hours per day.If he is following the marginal principle,what must his marginal cost be?

If a consumer can buy four DVDs for $44 and five DVDs for $50,then the marginal cost of the fifth DVD is

Introduction: What Is Economics

Exchange and Markets

Demand,supply,and Market Equilibrium

Elasticity: a Measure of Responsiveness

Market Efficiency and Government Intervention

Consumer Choice: Utility Theory and Insights From Neuroscience

Production Technology and Cost

Perfect Competition

Monopoly and Price Discrimination

Market Entry and Monopolistic Competition

Oligopoly and Strategic Behavior

Controlling Market Power: Antitrust and Regulation

Imperfect Information: Adverse Selection and Moral Hazard

Public Goods and Public Choice

External Costs and Environmental Policy

The Labor Market and the Distribution of Income

International Trade and Public Policy

Filters

Exam 2: The Key Principles of Economics

Table 2.3 -Refer to Table 2.3.The marginal product of the 1st worker is

Increase the level of an activity if its marginal benefit exceeds its marginal cost; reduce the level of an activity if its marginal cost exceeds its marginal benefit.This is known as the ________.

Suppose that your tuition to attend college is $5,000 per year and you spend $5,000 per year on room and board.If you were working full time,you could earn $22,000 per year.What is your opportunity cost of attending college?

According to the marginal principle,a rational individual should undertake an economic activity as long as the

What do economists mean when they say that there is "no such thing as a free lunch"?

As more and more of a variable input is combined with some fixed inputs,additions to the total output decline.

When you have a job and your employer compensates you for your time with money,resulting in both of you being better off,it is an example of a voluntary exchange.

Table 2.3 -Refer to Table 2.3.The marginal product of the 3rd worker is

If the nominal minimum wage is unchanged while prices fall,then the real minimum wage

Suppose your bank pays you 5% interest per year on your savings account while prices increase by 3% per year over that time.Approximately how much nominal value do you gain by keeping $100 in the bank for a year?

Recall the Application about the impact inflation has on your potential future salary and the repayment of student loans to answer the following question(s). -The Application shows that high inflation results in fewer years to pay back student loans because

The weekly income earned in 2015 could buy ________ standard baskets of goods and services.

Figure 2.4 -Joe runs a business and needs to decide how many hours to stay open.Figure 2.4 illustrates his marginal benefit of staying open for each additional hour.Suppose that Joe's marginal cost of staying open per hour is $24.How many hours should Joe stay open?

Figure 2.4 -Joe runs a business and needs to decide how many hours to stay open.Figure 2.4 illustrates his marginal benefit of staying open for each additional hour.Suppose that we observe Joe staying open 5 hours per day.If he is following the marginal principle,what must his marginal cost be?

Figure 2.4 -Joe runs a business and needs to decide how many hours to stay open.Figure 2.4 illustrates his marginal benefit of staying open for each additional hour.Suppose that we observe Joe staying open 3 hours per day.If he is following the marginal principle,what must his marginal cost be?

If a consumer can buy four DVDs for $44 and five DVDs for $50,then the marginal cost of the fifth DVD is

Introduction: What Is Economics

Exchange and Markets

Demand,supply,and Market Equilibrium

Elasticity: a Measure of Responsiveness

Market Efficiency and Government Intervention

Consumer Choice: Utility Theory and Insights From Neuroscience

Production Technology and Cost

Perfect Competition

Monopoly and Price Discrimination

Market Entry and Monopolistic Competition

Oligopoly and Strategic Behavior

Controlling Market Power: Antitrust and Regulation

Imperfect Information: Adverse Selection and Moral Hazard

Public Goods and Public Choice

External Costs and Environmental Policy

The Labor Market and the Distribution of Income

International Trade and Public Policy

Filters