Question 1

If you buy food which then is put on special at half price just after you paid,

Accepted Answer

A) you will be disappointed and be worse off. 
B) you will be better off because you will go back to get some more food at bargain prices. 
C) your welfare will not change since you just finished your shopping. 
D) logic cannot lead to an answer to this question even if you have a typical preference pattern. 
A) you will be disappointed and be worse off. 
B) you will be better off because you will go back to get some more food at bargain prices. 
C) your welfare will not change since you just finished your shopping. 
D) logic cannot lead to an answer to this question even if you have a typical preference pattern.

Question 2

If I get 10 units of pleasure from my first ice cream cone and 2 less units than before from each succeeding cone, I will buy ____ cones and gain _____ units of consumer surplus if the price of a cone = to 5 units of pleasure.

Accepted Answer

A) 4; 28 
B) 6; 30 
C) 2; 18 
D) 3; 9 
A) 4; 28 
B) 6; 30 
C) 2; 18 
D) 3; 9

Question 3

If an educational voucher system were adopted where parents could spend their share of education tax dollars at any school of their choice, then we could expect families to

Accepted Answer

A) choose less education than before because the public schools would get better. 
B) choose more education because they do not need to pay double for private education. 
C) make no changes in their education choices because the relative price of private and public education has not changed. 
D) make choices that cannot be predicted by economic theory. 
A) choose less education than before because the public schools would get better. 
B) choose more education because they do not need to pay double for private education. 
C) make no changes in their education choices because the relative price of private and public education has not changed. 
D) make choices that cannot be predicted by economic theory.

Question 4

The local golf course has upgraded seven of its 18 holes and raised its rates from 20 to 24 dollars. It would be correct to say that

Accepted Answer

A) the true inflation rate for golf is more than 20%. 
B) the true inflation rate for golf is 20%. 
C) the true inflation rate for golf is less than 20%. 
D) more information is needed to answer this question. 
A) the true inflation rate for golf is more than 20%. 
B) the true inflation rate for golf is 20%. 
C) the true inflation rate for golf is less than 20%. 
D) more information is needed to answer this question.

Question 5

Suppose a bank will pay you a 10% interest rate on your deposits for 1 period. In this case you must sacrifice $10 of current consumption to finance

Accepted Answer

A) $9 of future consumption. 
B) $10 of future consumption. 
C) $11 of future consumption. 
D) $1 of future consumption. 
A) $9 of future consumption. 
B) $10 of future consumption. 
C) $11 of future consumption. 
D) $1 of future consumption.

Question 6

According to the Life-cycle hypothesis, if a person received a payment roughly equals to her current income her consumption would:

Accepted Answer

A) roughly double. 
B) increase, but not by as much as the increase in income. 
C) increase by more than the increase in income. 
D) would not increase at all. 
A) roughly double. 
B) increase, but not by as much as the increase in income. 
C) increase by more than the increase in income. 
D) would not increase at all.

If you buy food which then is put on special at half price just after you paid,

If I get 10 units of pleasure from my first ice cream cone and 2 less units than before from each succeeding cone, I will buy cones and gain _ units of consumer surplus if the price of a cone = to 5 units of pleasure.

If an educational voucher system were adopted where parents could spend their share of education tax dollars at any school of their choice, then we could expect families to

The local golf course has upgraded seven of its 18 holes and raised its rates from 20 to 24 dollars. It would be correct to say that

Suppose a bank will pay you a 10% interest rate on your deposits for 1 period. In this case you must sacrifice $10 of current consumption to finance

According to the Life-cycle hypothesis, if a person received a payment roughly equals to her current income her consumption would:

Thinking Like an Economist

Supply and Demand

Rational Consumer Choice

Individual and Market Demand

The Economics of Information and Choice Under Uncertainty

Departures From Standard Rational Choice Models With and Without Regret

Production

Costs

Perfect Competition

Monopoly

A Game-Theoretic Approach to Strategic Behavior

Oligopoly and Monopolistic Competition

Labor

Capital

Externalities, Property Rights, and the Coase Theorem

General Equilibrium and Market Efficiency

Government

Filters

Exam 5: Applications of Rational Choice and Demand Theories

If you buy food which then is put on special at half price just after you paid,

If I get 10 units of pleasure from my first ice cream cone and 2 less units than before from each succeeding cone, I will buy ____ cones and gain _____ units of consumer surplus if the price of a cone = to 5 units of pleasure.

If an educational voucher system were adopted where parents could spend their share of education tax dollars at any school of their choice, then we could expect families to

The local golf course has upgraded seven of its 18 holes and raised its rates from 20 to 24 dollars. It would be correct to say that

Suppose a bank will pay you a 10% interest rate on your deposits for 1 period. In this case you must sacrifice $10 of current consumption to finance

According to the Life-cycle hypothesis, if a person received a payment roughly equals to her current income her consumption would:

Thinking Like an Economist

Supply and Demand

Rational Consumer Choice

Individual and Market Demand

The Economics of Information and Choice Under Uncertainty

Departures From Standard Rational Choice Models With and Without Regret

Production

Costs

Perfect Competition

Monopoly

A Game-Theoretic Approach to Strategic Behavior

Oligopoly and Monopolistic Competition

Labor

Capital

Externalities, Property Rights, and the Coase Theorem

General Equilibrium and Market Efficiency

Government

Filters

If I get 10 units of pleasure from my first ice cream cone and 2 less units than before from each succeeding cone, I will buy cones and gain _ units of consumer surplus if the price of a cone = to 5 units of pleasure.