Exam 1: Limits, Alternatives, and Choices

Marginal analysis is the comparison of additional benefits with the additional costs.

Suppose a consumer has an income of $16,the price of A is $2,and the price of B is $1.Which combination is on the consumer's budget line?

The combination of food and clothing shown by point G on the above graph:

Refer to the above graphs.Which of the above pairs of budget constraint lines illustrates a decrease in the price of good X and an increase in the price of good Y?

Refer to the above graphs.Which pairs of budget constraints represent only a decrease in the price of X,but no change in income and no change in the price of Y?

Tammie makes $150 a day as a bank clerk.She takes off two days of work without pay to fly to another city to attend the concert of her favorite music group.The cost of transportation for the trip is $250.The cost of the concert ticket is $50.The opportunity cost of Tammie's trip to the concert is:

Refer to the above graphs.Which pairs of budget constraints represent only an increase in income but no change in the prices of goods A and B?

Which of the following is not a central focus of the "economic perspective"?

Refer to the above graph.Assume that before the Persian Gulf War,Iraq's production possibilities were represented by AB.Which line on the above graph would represent the change in Iraq's production possibilities after the war?

The role of an assumption in an economic theory is to:

Cuba is a command economy that suffered decline in economic growth because of a cut in support from the former Soviet Union when it collapsed.As a consequence,Cuba:

When an economist says that there is "too much of a good thing," the economist is suggesting that:

Refer to the above production possibilities curves.Curve (a)is the current curve for the economy.Given production possibilities curve (a),point N suggests that the economy is:

A basic assumption used in most economic theories is that:

A nation that devotes more of its resources to capital investment is likely to:

From an economic perspective,when consumers leave a fast food restaurant because the lines to be served are too long,they have concluded the:

Economic resources in the capitalist system are brought together by:

The primary goal of economic activities is to:

Are the goods that businesses offer for "free" to consumers also free to society?

The following economy produces two products. Refer to the above table.In moving from possibility A to F,the cost of a unit of steel in terms of a unit of wheat: