Question 1

Scenario 1-3
It costs a company $35,000 to produce 700 graphing calculators.The company's cost will be $35,070 if it produces an additional graphing calculator.The company is currently producing 700 graphing calculators.
-Refer to Scenario 1-3.What is the minimum price the company will charge for the 701th calculator?

Accepted Answer

Question 2

Scarcity means that there is less of a good or resource available than people wish to have.

Accepted Answer

A) True 
 B)False  True

Question 3

Suppose your college institutes a new policy requiring you to pay for a permit to park your car in a campus parking lot.

Accepted Answer

A)   The cost of the parking permit is not part of the opportunity cost of attending college if you would not have to pay for parking otherwise.
B)   The cost of the parking permit is part of the opportunity cost of attending college if you would not have to pay for parking otherwise.
C)   Only half of the cost of the parking permit is part of the opportunity cost of attending college.
D)   The cost of the parking permit is not part of the opportunity cost of attending college under any circumstances.E) All of the above
F) None of the above

Question 4

What is another word for "marginal"?

Accepted Answer

incremental;additional

Question 5

Economics deals primarily with the concept of

Accepted Answer

A)   scarcity.
B)   money.
C)   poverty.
D)   banking.E) C) and D)
F) B) and D)

Question 6

If wages for accountants rose,then accountants' leisure time would have a lower opportunity cost.

Accepted Answer

A) True 
 B)False

Question 7

The invisible hand refers to

Accepted Answer

A)   how central planners made economic decisions.
B)   how the decisions of households and firms lead to desirable market outcomes.
C)   the control that large firms have over the economy.
D)   government regulations without which the economy would be less efficient.E) B) and D)
F) A) and B)

Question 8

You have eaten two bowls of ice cream at Sundae School Ice Cream store.You consider eating a third.As a rational consumer you should make your choice by comparing

Accepted Answer

A)   the benefits from eating all three bowls of ice cream to how much three bowls of ice cream costs.
B)   the benefits from eating all three bowls of ice cream to how much one more bowl of ice cream costs.
C)   the benefits from eating one more bowl of ice cream to how much three bowls of ice cream costs.
D)   the benefits from eating one more bowl of ice cream to how much one more bowl of ice cream costs.E) A) and B)
F) None of the above

Question 9

A barber currently cuts hair for 50 clients per week and earns a profit.He is considering expanding his operation in order to serve more clients.Should he expand?

Accepted Answer

A)   Yes,because cutting hair is profitable.
B)   No,because he may not be able to sell more services.
C)   It depends on the marginal cost of serving more clients and the marginal revenue he will earn from serving more clients.
D)   It depends on the average cost of serving more clients and the average revenue he will earn from serving more clients.E) A) and D)
F) A) and B)

Question 10

Which of these activities will most likely result in an external benefit?

Accepted Answer

A)   Jake purchases a dilapidated house and cleans up the yard and exterior of the house.
B)   John purchases an iPhone and downloads new apps.
C)   Jack purchases a new SUV and drives it to work every day.
D)   Joe purchases a suit and wears it on his interviews.E) A) and B)
F) None of the above

Question 11

A rational decisionmaker takes an action if and only if the marginal cost exceeds the marginal benefit.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following is the most correct statement about the relationship between inflation and unemployment?

Accepted Answer

A)   In the short run,falling inflation is associated with falling unemployment.
B)   In the short run,falling inflation is associated with rising unemployment.
C)   In the long run,falling inflation is associated with falling unemployment.
D)   In the long run,falling inflation is associated with rising unemployment.E) A) and B)
F) A) and D)

Question 13

Senator Green argues that replacing the income tax with a national sales tax would increase the level of output.Senator Brown objects that this policy would benefit the rich at the expense of the poor.

Accepted Answer

A)   Both Senators' arguments are primarily about equality.
B)   Both Senators' arguments are primarily about efficiency.
C)   Senator Green's argument is primarily about equality,while Senator Brown's argument is primarily about efficiency.
D)   Senator Green's argument is primarily about efficiency,while Senator Brown's argument is primarily about equality.E) A) and C)
F) C) and D)

Question 14

To increase living standards,public policy should

Accepted Answer

A)   ensure that workers are well educated and have the necessary tools and technology.
B)   make unemployment benefits more generous.
C)   move workers into jobs directly from high school.
D)   ensure a greater degree of equality,taking all income-earners into account.E) B) and C)
F) C) and D) A

Question 15

The phenomenon of scarcity stems from the fact that

Accepted Answer

A)   most economies' production methods are not very good.
B)   in most economies,wealthy people consume disproportionate quantities of goods and services.
C)   governments restrict production of too many goods and services.
D)   resources are limited.E) C) and D)
F) B) and D)

Question 16

Suppose Country A has a high average wage level and a high level of output per person,while Country B has a low average wage level and a low level of output per person.Which country can benefit from trade?

Accepted Answer

A)   Only Country A can benefit.
B)   Only Country B can benefit.
C)   Both Country A and Country B can benefit.
D)   Neither Country A nor Country B can benefit.E) B) and D)
F) B) and C)

Question 17

In a market economy,who makes the decisions that guide most economic activity?

Accepted Answer

A)   firms only
B)   households only
C)   firms and households
D)   governmentE) B) and D)
F) A) and D)

Question 18

Suppose the cost of operating a 75 room hotel for a night is $6,000 and there are 5 empty rooms for tonight.The marginal cost per room per night

Accepted Answer

A)   is $40.
B)   is $80.
C)   is $120.
D)   cannot be determined from the information given.E) A) and B)
F) None of the above

Question 19

The slow growth of U.S.incomes during the 1970s and 1980s can best be explained by

Accepted Answer

A)   unstable economic conditions in Eastern Europe.
B)   increased competition from abroad.
C)   a decline in the rate of increase in U.S.productivity.
D)   a strong U.S.dollar abroad,hurting U.S.exports.E) A) and B)
F) A) and C)

Question 20

Both the production of goods and services and the unemployment rate are used to measure

Accepted Answer

A)   the business cycle.
B)   productivity.
C)   the interest rate.
D)   inflation.E) A) and D)
F) All of the above

Exam 1: Ten Principles of Economics

Correct Answer
verified

Scarcity means that there is less of a good or resource available than people wish to have.

Correct Answer
verified
True

Suppose your college institutes a new policy requiring you to pay for a permit to park your car in a campus parking lot.

Correct Answer
verified

What is another word for "marginal"?

Correct Answer
verified
incremental;additional

Economics deals primarily with the concept of

Correct Answer
verified

If wages for accountants rose,then accountants' leisure time would have a lower opportunity cost.

Correct Answer
verified

The invisible hand refers to

Correct Answer
verified

You have eaten two bowls of ice cream at Sundae School Ice Cream store.You consider eating a third.As a rational consumer you should make your choice by comparing

Correct Answer
verified

A barber currently cuts hair for 50 clients per week and earns a profit.He is considering expanding his operation in order to serve more clients.Should he expand?

Correct Answer
verified

Which of these activities will most likely result in an external benefit?

Correct Answer
verified

A rational decisionmaker takes an action if and only if the marginal cost exceeds the marginal benefit.

Correct Answer
verified

Which of the following is the most correct statement about the relationship between inflation and unemployment?

Correct Answer
verified

Senator Green argues that replacing the income tax with a national sales tax would increase the level of output.Senator Brown objects that this policy would benefit the rich at the expense of the poor.

Correct Answer
verified

To increase living standards,public policy should

Correct Answer
verified
A

The phenomenon of scarcity stems from the fact that

Correct Answer
verified

Suppose Country A has a high average wage level and a high level of output per person,while Country B has a low average wage level and a low level of output per person.Which country can benefit from trade?

Correct Answer
verified

In a market economy,who makes the decisions that guide most economic activity?

Correct Answer
verified

Suppose the cost of operating a 75 room hotel for a night is $6,000 and there are 5 empty rooms for tonight.The marginal cost per room per night

Correct Answer
verified

The slow growth of U.S.incomes during the 1970s and 1980s can best be explained by

Correct Answer
verified

Both the production of goods and services and the unemployment rate are used to measure

Correct Answer
verified

Exam 1: Ten Principles of Economics

Correct AnswerverifiedShow Answer

Scarcity means that there is less of a good or resource available than people wish to have.

Correct AnswerverifiedTrue

Suppose your college institutes a new policy requiring you to pay for a permit to park your car in a campus parking lot.

Correct AnswerverifiedShow Answer

What is another word for "marginal"?

Correct Answerverifiedincremental;additional

Economics deals primarily with the concept of

Correct AnswerverifiedShow Answer

If wages for accountants rose,then accountants' leisure time would have a lower opportunity cost.

Correct AnswerverifiedShow Answer

The invisible hand refers to

Correct AnswerverifiedShow Answer

You have eaten two bowls of ice cream at Sundae School Ice Cream store.You consider eating a third.As a rational consumer you should make your choice by comparing

Correct AnswerverifiedShow Answer

A barber currently cuts hair for 50 clients per week and earns a profit.He is considering expanding his operation in order to serve more clients.Should he expand?

Correct AnswerverifiedShow Answer

Which of these activities will most likely result in an external benefit?

Correct AnswerverifiedShow Answer

A rational decisionmaker takes an action if and only if the marginal cost exceeds the marginal benefit.

Correct AnswerverifiedShow Answer

Which of the following is the most correct statement about the relationship between inflation and unemployment?

Correct AnswerverifiedShow Answer

Senator Green argues that replacing the income tax with a national sales tax would increase the level of output.Senator Brown objects that this policy would benefit the rich at the expense of the poor.

Correct AnswerverifiedShow Answer

To increase living standards,public policy should

Correct AnswerverifiedA

The phenomenon of scarcity stems from the fact that

Correct AnswerverifiedShow Answer

Suppose Country A has a high average wage level and a high level of output per person,while Country B has a low average wage level and a low level of output per person.Which country can benefit from trade?

Correct AnswerverifiedShow Answer

In a market economy,who makes the decisions that guide most economic activity?

Correct AnswerverifiedShow Answer

Suppose the cost of operating a 75 room hotel for a night is $6,000 and there are 5 empty rooms for tonight.The marginal cost per room per night

Correct AnswerverifiedShow Answer

The slow growth of U.S.incomes during the 1970s and 1980s can best be explained by

Correct AnswerverifiedShow Answer

Both the production of goods and services and the unemployment rate are used to measure

Correct AnswerverifiedShow Answer

Correct Answer
verified

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True

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incremental;additional

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A

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