econ exam 2

  1. Suppose your New Year resolution is to get back in shape. You are considering various ways of doing  this: you can sign up for a gym  membership, walk to  work, take the stairs instead of the  elevator, or watch your diet.
    Do a​ cost-benefit analysis to compare the alternatives.
  2. When making your decision about which activity to  choose, you should consider the monetary cost ___ the opportunity cost of the activities. The goal is to choose the option that offers the greatest ____
    as well as, net benefit
  3. During the process of optimization, economists believe that people are considering
    the feasibility of a​ choice, given the information available at the time
  4. The goal of optimization for an individual is to maximize
    overall well being
  5. Your budget constraint for entertainment illustrates the concept of ____ since as you increase your purchases of one​ item, you ___
    trade offs,  must decrease your purchases of the other item
  6. The _______- of an activity is a measure of what is given up when you do that activity.
    opportunity cost
  7. comparing a set of feasible alternatives and picking the best one is an optimization process called​
    cost-benefit analysis
  8. When deciding whether to install visible countdown timers for pedestrians at crosswalks, which of the following would be considered in the cost-benefit analysis?
    all apply
  9. Free riding occurs when ____ are out of sync with ____
    people's private benefits, the public interest
  10. Which of the following is subject to the free-rider problem?
    • -National security
    • -Public libraries
    • -neighborhood watch.
  11. Which of the following is more susceptible to the free-rider problem: state parks or public roads?
    Use of public is more susceptible since even those who don't pay taxes still benefit, while state parks can charge for admission , so that everyone who goes pays their share.
  12. The amount produced by sellers must be ____  the amount purchased by buyers
    equal to
Card Set
econ exam 2
exam 1