Exam 1: First Principles

Using marginal analysis to decide whether to consume an additional slice of pizza requires making a comparison of the benefits and costs associated with the consumption of an additional slice of pizza.

Which of the following demonstrates how people respond to incentives to make themselves better off?

The problem of scarcity is confronted by:

Your elderly grandma tells you: "I haven't been taking my beloved walks because I'm concerned about falling and getting hurt. See, there is always a cost to doing something. But if you don't do anything, then there is no cost." Your grandma does not understand the economic concept of:

Which of the following statements is NOT true?

At most airports there are multiple security guards ready to screen passengers and their luggage through the X-ray and metal detector checkpoints. The length of the wait for each line is about the same. Why?

If the value of homes in University City increases and as a result the people of University City spend more, incomes in University City will:

An economy has achieved _____ if it _____ pass up any opportunities to make some people better off without making others worse off.

A dozen friends got together to celebrate a birthday. If the birthday cake is cut into 12 pieces of the same size and each of the 12 partygoers gets a slice, this cake distribution is:

The BEST example of making a choice at the margin is whether to:

A grocery store benefits when a new furniture factory moves to town and hires workers because:

A popular train station has free parking for commuters who take the train. This often results in many people being unable to find a parking spot and missing their train. To solve this problem, all commuters should be:

Specialization and trade should lead to all of the following EXCEPT:

Suppose a local community decides to give all of its citizens over age 60 a parking pass that will enable them to park in the front of parking lots. For people over 60, this policy is:

The trade-off between equity and efficiency occurs because:

It is cheaper to produce corn in Kansas than in Death Valley, California, because corn needs a lot of water and moderate temperatures. This statement best represents this economic concept:

Suppose small business owners decide to spend less. How will this affect an economy?

Which of the following principles underlies the interaction of individual choices?

In baseball, when one manager decides to send in a pinch hitter, the other manager often changes pitchers. This sometimes causes the first manager to send in a new pinch hitter. Once both managers decide that no more player substitutions will benefit their team, the situation has reached:

The best measure of the opportunity cost of any choice is: