Micro exam 1.txt

when calculating the opportunity cost of college, which of the following should your probably not include?
A. the cost of tuition
B. the income you would have earned had you not gone to college
C. the cost of books required for college classes
D. the cost of rent for your off-campus apartment

which of the following proases best captures the notion of efficiency?
A. equitable outcome
B. equal distribution
C. minimum waste
D. absolute fairness

high school athletes who skip college to become professional athletes
A. usually do so because they cannot get into college
B. are not making a rational decision since the marginal benefits of college outweigh the marginal costs of college for high school athletes
C. understand that the opportunity cost of attending college is very high
D. obviously do not understand the value of a college education

after much consideration, you have chosen Cancun over Ft. Lauderdale as your spring break destination this year. however, spring break is still months away, and you may reverse this decision. which of the following events would prompt you to reverse this decision?
A. the marginal benefit of going to Cansun increases
B. the marginal benefit of going to Ft. Lauderdale decreases
C. the marginal cost of going to Fe. lauderdale decreases
D. the marginal cost of going to Cancun decreases

if the united states decides to trade with mexico, we know that
A. mexico will benefit, but trade with a less developed country could not benefit the united states
B. it will not benefit mexico because workers in the united states are more productive
C. mexico and the united states can both benefit
D. it will not benefit either country because their cultural differences are too vast

the opportunity cost of obtaining more of one good is shown on the production possibiliies frontier as the
A. market price of the additional amount produced
B. amount of resources that must be devoted to its production
C. amount of the other good that must be given up
D. number of dollars that must be spent to produe it

which of the following events could shift the demand curve for gasoline to the left?
A. the income of gasoline buyers rises, and the fasoline is a normal good
B. public service announcements run on television encourage people to walk or ride bicycles instead of driving cars
C. the proce of gasoline rises
D. the income of gasoline buyers falls, and gasoline is an inferior good

the opportunity cost of this economy moving from point A to point B is
A. 20 toasters
B. 10 toothbrushes
C. 0 toasters
D. 10 toasters

if this economy devotes all of its resources to the production of tooth brushers, then is till produce
A. 70 toothbrushes and 0 toasters
B. 0 toothbrushes and 40 toasters
C. 35 toothbrushes and 20 toasters
D. 70 toothbrushes and 40 toasters

assume that greece has a comparative adveantage in fish and germany has a comparative adveantage in cars. also assume that germany has an absolute advantage in both fish and cars. if these two countrises specialize and trade so as to maximize the benefits of specialization and trade, then
A. the two countries combined output of both goods will be higher than it would be in the absence of trade
B. greece will produce more fish than it would produce in the absence of trade
C. germany will produce more cars than it would produce in the absence of trade
D. all of the above

if the demand for a product increases (i.e., the demand curve shifts right), then we would expect
A. equilbrium price to increase and equilbrium quantity to decrease
B. equilbrium price to decrease and equilbrium quantity to increase.
C. equilbrium price and equilbrium quantity both to increase.
equilbrium price and equilbrium quantity both to decrease.

mallory decides to spend three hours working overtime rather than watching a vider with her friends. shie earns $8 an hour. her opportunity cost of working is
A. nothing, since she would have recieved less than $24 of enjoument from the video
B. the enjoyment she woulld have recieved had she wathed the video
C. the $24 she earns working
D. the $24 minus the enjoyment she would have recieved from watching the video

the movement from D to D' could be caused by
A. a decrease in the price of a substitute
B. an increase in price
C. a technological advence
D. a decrease in the proce of a complement

a decrease in input costs to firms in a market will result in
A. decrease in equilibrium price and an increase in equilibrium quantity
B. a decrease in equilibrium price and a decrease in equilibrium quantity
C. an increase in equilibrium price and an increase in equilibrium quantity
D. an increase in equilibrium price and a decrease in equilibrium quantity

of a surplus exists in a market, then we know that the atual price is
A. above the equilibrium price and quantity supplied is greater than quantity demanded
B. above the equilibrium price and quantity demanded is greater than quantity supplied
C. below the equilibrium price and quantity demanded is greater than quantity supplied
D. below the equilibrium price and quantity supplied is greater than quantity demanded

which of the following is an example of a normative, as opposed to positive, statement?
A. if the government were to set a maximm legal price on gasoline, ten there wold be a shortage of gasoline
B. the income taxes should be reduced
C. the federal gobernment obtains much of its revenue from income taxes
D. the price of gasoline came down sharply during the second half of 2006

the amount of goods and services produced from each unit of labor input os called
A. productibity
B. marginal benefit
C. externality
D. opportunity cost

in economice, physical capital refers to
A. the finances necessary for firms to produce their products
B. the money households use to pruchase firms output
C. buildings and machines used in the production process
D. stocks and bonds

which of the following events would explain the shift of the production possibilities fromtier from A to B
a. the economy's citzens developed an enhanced taste for batteries
b. the economy experienced a technological advence in the production of betteries
more capital became available in the econom
d. more labor bacame available in the economy

all else equal, a large number of people becoming vegetarians would cause a move
A. from Db to Da
B. from y to x
C. from x to y
D. from Da to Db

unemployment would cause an economy to
A. produce on its production possibilities frontier
B. produce inside its production possibilities frontier
C. produce outside its production possibilities frontier
D. experience an inward shift of its production possibilites frontier

a downward-sloping demand curve illistrates
A. that prices fall over time
B. that demand decreases over time
C. the law of demand
D. the relationship between income and quantity demanded

economists believe that production possibilities frontiers
A. often have a bowed shape
B. never have a bowed shape
C. always are upward sloping, showing that it is possible to produce more of both goods simultaneousy
D. rarely have a bowed shape

a technological advence will shift the
A. demand curve to the left
B. demand curbe to the right
C. supply curve to the left
D. supply curve to the right

the basic principles of economics suggest the
A. markets are seldom, if ever, a good way to organize economic actibity
B. gobernment should become involved in markets when trade between countries is involved, such as imposing trade restrictions, in order to increase efficiency
C. gobernment shoulld become inbolbed in markets when thse markets fail to produce efficient outcomes
D. all of the above

production is efficient if the econom is producing at a point
A. inside the production possibilities
B. on or inside the production possibilities frontier
C. on the production possibilities frontier
D. outside the production possibilities frontier

if Iowa's opportunity cost of corn is lower than Oklahoma's opportunity cost of corn, then
A. iowa has an absolute advantage in the production of corn
B. iowa has a comparative advantage in the production of corn
C. iowa should import corn from oklahoma
D. oklahoma should produce just enough corn to satisfy its own residents' demands

beef is a normal good. you observe that both the equilitrium price and quantity of beef have fallen over time. which of the following explanations would be most consistent with this observation?
A. nw medical evidence has been released that indicates a negatice correlation between a persons beef consumption and his or her longevity (i.e., overall health)
B. the price of chicken has risen and the price of steak sause has fallen
C. the demand curve for beef
D. consumers have experienced an increase in income and beef-production technology has improved

which of the following is not a variable that shifts the demand curve for a particular good?
A. income
B. the prices of related goods
C. the prices of the inputs used to produce the good
D. tastes

the supply of a good or service is determined by
A. those who buy the good or service
B. the government
C. those who sell the good or service
D. both those who buy and those who sell the good or service

puneet has an absolute advantage in the production of
a. purses and chirag has an absolute advantage in the production of walltes
b. wallets and chirag has an absolute advantage in the production of purses
b. both goods and chirag has an absolute advantage in the production of neither good
d. neither good and chirag has an absolute advantage in the production of both goods

puneet has a comparative advantage in the production of
a. purses and chirag has a comparative adcantage in the production of wallets
b. wallets and chirag has an absolute advantage in the production of purses
bother goods and chirag has an absiolute advantage in the production of neither good
d. neither good and chirag has an absolute advantage in the production of both goods

if puneet and chirag switch from each person dividing his time equally between the production of purses and wallets to each person spending all of his time producing the god in which he has a comparative advantage, then total production of purses will increase by
A. 10
B. 5
C. 3
D. 2