econ exam 6

  1. Marcia finds that the net benefit of flying from Chicago to Honolulu on a​ non-stop United Airlines flight is​ $400, and the net benefit for the same trip flying on a​ one-stop American Airlines flight is​ $200.
    Optimization in​ levels, since she is comparing the net benefits between alternatives.
  2. Nikki decided to take the first available parking space as she entered the student lot. She felt that the first available space had a​ $5 premium compared with all other possible spaces since she did not want to risk being late for her exam
    Optimization in differences, since she is calculating the change in net benefits between alternatives.
  3. Reagan determined that the net benefit of taking the combination of two lecture courses and an online lecture course was​ $100. The same three courses online gave her a net benefit of​ $80, and all three in a​ lecture-based format gave her a net benefit of​ $90.
    Optimization in levels, since she is comparing the net benefits between alternatives.
  4. The concept of opportunity cost would explain whether someone chooses to drive, take a  cab, take a  bus, or walk to school or work because someone with  ___________.
    a high wage is more likely to drive or take a cab to work because his time is worth more.
  5. Does this imply that using a bus to get to the destination involves lower total costs than getting there by  car? What if the bus  doesn't take the fastest route from point A to point  B?
    The marginal cost of using a bus may be higher if it takes more time than by car.
  6. In a perfectly competitive​ market, sellers​ _________ and buyers​ _________.
    cannot charge more than the market price; cannot pay less than the market price.
  7. In a perfectly competitive  market, if one seller chooses to charge a price for its good that is slightly higher than the market  price, then it will  _________.
    lose all or almost all of its customers.
  8. Market demand is derived by​ __________.
    fixing the price and adding up the quantities that each buyer demands.
  9. Does the shape of the market demand curve differ from the shape of an individual demand curve?
    No, they both tend to be downward-sloping curves.
Card Set
econ exam 6
exam 1