Exam 1: Economics: Foundations and Models

Figure 1.4 Alt text for Figure 1.4: In figure 1.4, a graph with the x-axis labelled quantity, and the y-axis labelled total revenue in dollars. Long description for Figure 1.4: A wide, inverted U-shaped curve is drawn from the vertex upward to the center of the quadrant, and then, back down toward the x-axis.2 points, E and F, are marked along the curve.Point E is positioned on the rising side of the curve, while point F is positioned on the falling side.A tangent passes through each of these points.The tangent for point E slopes upward from bottom left to top right of the quadrant.The tangent for point F, slopes downward from the top left to bottom right of the quadrant. -Refer to Figure 1.4.Which of the following statements is false?

An economic model is a simplified version of reality used to analyze real-world economic situations.

Which of the following is a normative economic statement?

In economics, the term "equity" means

What is equity, and how does it differ from efficiency?

By definition, economics is the study of

Which of the following statements is true about scarcity?

Which of the following statements about economic resources is true?

In economics, choices must be made because we live in a world of

An economic ________ is a simplified version of some aspect of economic life used to analyze an economic issue.

Political candidates often hold fund raisers by charging "per plate" for dinner.Wendy purchased four tickets to a $1,000 per plate dinner for a local city council candidate.Is this transaction economically efficient?

Define productive efficiency.Does productive efficiency imply allocative efficiency? Explain.

Economists reason that the optimal decision is to continue any activity up to the point where the

Suppose your provincial government encouraged new medical school graduates to take over rural and small town practices from doctors wishing to retire by paying both the new and retiring doctors $100,000.These doctors would be exemplifying the economic idea that

What is a centrally planned economy?

A grocery store sells a bag of potatoes at a fixed price of $5.50.Which of the following is a term used by economists to describe the money received from the sale of an additional bag of potatoes?

Table 1.1 Lydia runs a small nail salon in the town of New Hope.She is debating whether she should extend her hours of operation.Lydia figures that her sales revenue will depend on the number of hours the nail salon is open as shown in the table above.She would have to hire a worker for those hours at a wage rate of $10 per hour. -Refer to Table 1.1.Using marginal analysis, determine how many hours should Lydia extend her nail salon's hours of operations?

Which of the following statements about positive economic analysis is false?

The approximately 12 seconds between episodes on Netflix means that binge watching is

Automobile manufacturers produce a range of automobiles such as sports utility vehicles, luxury sedans, pickup trucks and compact cars.What fundamental economic question are they addressing by making this range of products?