Exam 1: Economics: Foundations and Models

Soo Jin shares a one-bedroom apartment with her classmate.Her share of the rent is $700 per month.She is considering moving to a studio apartment which she will not have to share with anyone.The studio apartment rents for $950 per month.Recently,you ran into Soo Jin on campus and she tells you that she has moved into the studio apartment.Soo Jin is as rational as any other person.As an economics student,you rightly conclude that

Suppose the U.S.government encouraged new medical school graduates to take over existing 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

Table 1-2 Extra Hours Open Total Revenue (dollars) 1 45 70 4 90 5 105 6 110 Thuy Anh runs a small flower shop in the town of Florabunda.She is debating whether she should extend her hours of operation.Thuy Anh figures that her sales revenue will depend on the number of extra hours the flower shop is open as shown in the table above.She would have to hire a worker for those extra hours at a wage rate of $16 per hour. -Refer to Table 1-2.Using marginal analysis,by how many hours should Thuy Anh extend her flower shop's hours of operations?

Which of the following is a positive economic statement?

Which of the following are positive economic statements and which are normative economic statements? a.An increase in the price of gasoline will decrease the quantity of gasoline purchased. b.The government should eliminate the minimum wage. c.All states should raise the minimum wage to at least $10 per hour. d.The government should scrap its current income tax structure in favor of a flat tax. e.Unemployment has increased since the onset of the recession. f.The government should not bail out investment banks during a financial crisis.

Pookie's Pinball Palace restores old Pinball machines.Pookie has just spent $300 purchasing and cleaning a 1960s-era machine which he expects to sell for $2,000 once he is finished with the restoration.After having spent $300,Pookie discovers that he will need to rewire the entire machine at a cost of $1,100 in order to finish the restoration.Alternatively,he can sell the machine "as is" now for $1,000. -What is the marginal cost of completing the task?

Which of the following is part of an economic model?

Economic models

One example of human capital is the amount of skills that you have.

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

Assume that a florist can earn an additional $20,000 of revenue each year from advertising once a week on a local television station.What must the additional cost of this once-a-week advertising be to make this advertising economically rational?

In 2015,Peelville consumed 30,000 bananas.In 2016,banana consumption rose to 35,000.Calculate the percentage change in banana consumption.

Which of the following is a problem inherent in centrally planned economies?

If the marginal cost of producing a television is constant at $200,then a firm should produce this item

The U.S.Bureau of Labor Statistics predicts that 13 of the 20 fastest growing occupations over the next ten years will be in

Consider the following economic agents: A.the government B.consumers C.producers Who,in a modern mixed economy,decides what goods and services will be produced with the scarce resources available in that economy?

Table 1-1 Extra Hours Open Total Revenue (dollars) 1 \ 50 2 75 3 95 4 110 5 120 6 125 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 extra hours the nail salon is open as shown in the table above.She would have to hire a worker for those extra hours at a wage rate of $10 per hour. -Refer to Table 1-1.What is Lydia's marginal benefit if she decides to stay open for an extra two hours instead of one hour?

Who receives the most of what is produced in a market economy?

What is the difference between economic efficiency and equity?

What is an economic model?