Question 1

You had to pay $600 (non-refundable) for your meal plan for Fall semester which gives you up to 150 meals.If you eat only 100 meals,your average cost for a meal equals:

Accepted Answer

A)   $6.
B)   $5.
C)   $4.
D)   $0.25.

Question 2

You paid $35 for a ticket (which is non-refundable) to see SPAM,a local rock band,in concert on Saturday.(Assume that you would not have been willing to pay any more than $35 for this concert. ) Your boss called and she is looking for someone to cover a shift on Saturday at the same time as the concert.You will have to work 4 hours and she will pay you time and a half,which is $9/hr.
What is the opportunity cost of going to the concert?

Accepted Answer

A)   $1
B)   $9
C)   $35
D)   $36

Question 3

If all the world's resources were to magically increase a hundredfold,then:

Accepted Answer

A)   the scarcity principle would still govern behavior.
B)   economics would no longer be relevant.
C)   the scarcity principle would disappear.
D)   tradeoffs would become unnecessary.

Question 4

A firm employs Pam to assemble personal computers.Pam can assemble 1 computer if she works 1 hour,4 computers in 2 hours,8 computers in 3 hours,10 computers in 4 hours,and 11 computers in 5 hours.Each computer consists of a motherboard that costs $200,a hard drive that costs $100,a case that costs $20,a monitor that costs $200,a keyboard that costs $60 and a mouse that costs $20.The cost of employing Pam is $40 per hour.
The firm sells each computer for $620.How many hours should the firm employ Pam to maximize its benefit from her employment?

Accepted Answer

A)   0 hour
B)   1 hour
C)   3 hours
D)   4 hours

Question 5

Moe has a big exam tomorrow.He considered studying this evening,but decided to go out with Curly instead.Since Moe always chooses rationally,it must be true that:

Accepted Answer

A)   the opportunity cost of studying tonight is less than the value Moe gets from spending time with Curly.
B)   the opportunity cost of studying tonight is equal to the value Moe gets from spending time with Curly minus the cost of earning a low grade on the exam.
C)   Moe gets more benefit from spending time with Curly than from studying.
D)   Moe gets less benefit from spending time with Curly than from studying.

Question 6

Dean decided to play golf rather than prepare for tomorrow's exam in economics.One can infer that:

Accepted Answer

A)   Dean has made an irrational choice.
B)   Dean is doing poorly in his economics class.
C)   the economic surplus from playing golf exceeded the surplus from studying.
D)   the cost of studying was less than the cost of golfing.

Question 7

The average benefit of an activity is the:

Accepted Answer

A)   total benefit of the activity divided by the number of units.
B)   number of units divided by the total benefit of the activity.
C)   number of units times the total benefit of the activity.
D)   extra benefit for one additional unit of the activity.

Question 8

Amy is thinking about going to the movies tonight.A ticket costs $7 and she will have to cancel her dog-sitting job that pays $30.The cost of seeing the movie is:

Accepted Answer

A)   $7.
B)   $30.
C)   $37.
D)   $37 minus the benefit of seeing the movie. C

Question 9

If the marginal costs of 1,2,and 3 hours of talking on the phone are $50,$75,and $105 respectively,then the total costs are of 1,2 and 3 hours of talking on the phone are:

Accepted Answer

A)   $50,$150,and $315 respectively.
B)   $50,$41.67,and $115 respectively.
C)   $50,$125,and $230 respectively.
D)   $50,$175,and $405 respectively.

Question 10

Sally earned $25,000 per year before she became a mother.After she became a mother,she told her employer that her opportunity cost of working is now $50,000,and so she is not willing to work for anything less.Her decision is based on:

Accepted Answer

A)   the high cost of raising a child.
B)   her desire to save for her child's college expenses.
C)   her increased value to her employer.
D)   the value she places on spending time with her child.

Question 11

You save $10 on gas every week since you live close to the bus stop.You have class five days a week.What is your average benefit per day for living close to the bus stop?

Accepted Answer

A)   $10
B)   $5
C)   $2
D)   $1.43 C

Question 12

Economic models are intended to:

Accepted Answer

A)   apply to all examples equally well.
B)   eliminate differences in the way people behave.
C)   generalize about patterns in decision-making.
D)   distinguish economics students from everyone else.

Question 13

The range of topics or issues that fit within the definition of economics is:

Accepted Answer

A)   limited to market activities,e.g. ,buying soap.
B)   limited to individuals and firms.
C)   extremely wide,requiring only the ideas of choice and scarcity.
D)   very limited.

Question 14

Suppose a person makes a choice that seems inconsistent with the cost-benefit principle.Which of the following statements represents the most reasonable conclusion to draw?

Accepted Answer

A)   The person (explicitly or implicitly) over-estimated the benefits or under-estimated the costs or both.
B)   The cost-benefit principle is rarely true.
C)   The person does not grasp how decisions should be made.
D)   The person is simply irrational.

Question 15

Studying how Pat allocates her time between teaching classes and assisting undergraduate students is an example of:

Accepted Answer

A)   microeconomics.
B)   macroeconomics.
C)   individual economics.
D)   economic naturalism.

Question 16

An economic naturalist is described as someone who:

Accepted Answer

A)   uses economic arguments to protect forests and wetlands from development.
B)   has a natural talent for drawing graphs.
C)   applies economic insights to everyday life.
D)   studies the process of natural selection in a marginal cost and marginal benefit framework.

Question 17

An editorial in the paper argues that students should only be allowed to attend school so long as the marginal cost of educating that student is less than the marginal benefit of that student's education.The writer's reasoning is an application of:

Accepted Answer

A)   positive economics.
B)   negative economics.
C)   normative economics.
D)   economic naturalism.

Question 18

Pat can either drive to work,which takes half an hour and uses $1.50 worth of gas,or take the bus,which takes an hour and costs $1.00.How should Pat get to work?

Accepted Answer

A)   Pat should always take the bus because it costs $0.50 less.
B)   Pat should always drive because it saves half an hour.
C)   Pat should drive if saving a half hour is worth $0.50 or more.
D)   Pat should take the bus if a half hour of time is worth $0.50 or more.

Question 19

You own a pizza shop called "Pizzas'R' Us".Currently you are paying your cooks an hourly wage of $20.You sell a medium pizza for $10.By hiring more cooks,you can increase your pizza production as shown in the following table.   Number of  cooks  Total production of  pizzas each hour 00142739410510\begin{array} { | l | l | } \hline \begin{array} { l } 	ext { Number of } \	ext { cooks }\end{array} & \begin{array} { l } 	ext { Total production of } \	ext { pizzas each hour }\end{array} \\hline 0 & 0 \\hline 1 & 4 \\hline 2 & 7 \\hline 3 & 9 \\hline 4 & 10 \\hline 5 & 10 \\hline\end{array} Number of  cooks ​012345​ Total production of  pizzas each hour ​04791010​​ 
How many cooks should you hire to maximize your net benefit?

Accepted Answer

A)   1
B)   3
C)   4
D)   5  B

Question 20

A study that deals with the salaries of university professors would be considered:

Accepted Answer

A)   macroeconomics
B)   microeconomics
C)   economic naturalism
D)   marginal benefit

Exam 1: Thinking Like an Economist

You had to pay $600 (non-refundable) for your meal plan for Fall semester which gives you up to 150 meals.If you eat only 100 meals,your average cost for a meal equals:

Correct Answer
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Correct Answer
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If all the world's resources were to magically increase a hundredfold,then:

Correct Answer
verified

Correct Answer
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Moe has a big exam tomorrow.He considered studying this evening,but decided to go out with Curly instead.Since Moe always chooses rationally,it must be true that:

Correct Answer
verified

Dean decided to play golf rather than prepare for tomorrow's exam in economics.One can infer that:

Correct Answer
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The average benefit of an activity is the:

Correct Answer
verified

Amy is thinking about going to the movies tonight.A ticket costs $7 and she will have to cancel her dog-sitting job that pays $30.The cost of seeing the movie is:

Correct Answer
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C

If the marginal costs of 1,2,and 3 hours of talking on the phone are $50,$75,and $105 respectively,then the total costs are of 1,2 and 3 hours of talking on the phone are:

Correct Answer
verified

Sally earned $25,000 per year before she became a mother.After she became a mother,she told her employer that her opportunity cost of working is now $50,000,and so she is not willing to work for anything less.Her decision is based on:

Correct Answer
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You save $10 on gas every week since you live close to the bus stop.You have class five days a week.What is your average benefit per day for living close to the bus stop?

Correct Answer
verified
C

Economic models are intended to:

Correct Answer
verified

The range of topics or issues that fit within the definition of economics is:

Correct Answer
verified

Suppose a person makes a choice that seems inconsistent with the cost-benefit principle.Which of the following statements represents the most reasonable conclusion to draw?

Correct Answer
verified

Studying how Pat allocates her time between teaching classes and assisting undergraduate students is an example of:

Correct Answer
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An economic naturalist is described as someone who:

Correct Answer
verified

An editorial in the paper argues that students should only be allowed to attend school so long as the marginal cost of educating that student is less than the marginal benefit of that student's education.The writer's reasoning is an application of:

Correct Answer
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Pat can either drive to work,which takes half an hour and uses $1.50 worth of gas,or take the bus,which takes an hour and costs $1.00.How should Pat get to work?

Correct Answer
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Correct Answer
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B

A study that deals with the salaries of university professors would be considered:

Correct Answer
verified

Exam 1: Thinking Like an Economist

You had to pay $600 (non-refundable) for your meal plan for Fall semester which gives you up to 150 meals.If you eat only 100 meals,your average cost for a meal equals:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

If all the world's resources were to magically increase a hundredfold,then:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Moe has a big exam tomorrow.He considered studying this evening,but decided to go out with Curly instead.Since Moe always chooses rationally,it must be true that:

Correct AnswerverifiedShow Answer

Dean decided to play golf rather than prepare for tomorrow's exam in economics.One can infer that:

Correct AnswerverifiedShow Answer

The average benefit of an activity is the:

Correct AnswerverifiedShow Answer

Amy is thinking about going to the movies tonight.A ticket costs $7 and she will have to cancel her dog-sitting job that pays $30.The cost of seeing the movie is:

Correct AnswerverifiedC

If the marginal costs of 1,2,and 3 hours of talking on the phone are $50,$75,and $105 respectively,then the total costs are of 1,2 and 3 hours of talking on the phone are:

Correct AnswerverifiedShow Answer

Sally earned $25,000 per year before she became a mother.After she became a mother,she told her employer that her opportunity cost of working is now $50,000,and so she is not willing to work for anything less.Her decision is based on:

Correct AnswerverifiedShow Answer

You save $10 on gas every week since you live close to the bus stop.You have class five days a week.What is your average benefit per day for living close to the bus stop?

Correct AnswerverifiedC

Economic models are intended to:

Correct AnswerverifiedShow Answer

The range of topics or issues that fit within the definition of economics is:

Correct AnswerverifiedShow Answer

Suppose a person makes a choice that seems inconsistent with the cost-benefit principle.Which of the following statements represents the most reasonable conclusion to draw?

Correct AnswerverifiedShow Answer

Studying how Pat allocates her time between teaching classes and assisting undergraduate students is an example of:

Correct AnswerverifiedShow Answer

An economic naturalist is described as someone who:

Correct AnswerverifiedShow Answer

An editorial in the paper argues that students should only be allowed to attend school so long as the marginal cost of educating that student is less than the marginal benefit of that student's education.The writer's reasoning is an application of:

Correct AnswerverifiedShow Answer

Pat can either drive to work,which takes half an hour and uses $1.50 worth of gas,or take the bus,which takes an hour and costs $1.00.How should Pat get to work?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedB

A study that deals with the salaries of university professors would be considered:

Correct AnswerverifiedShow Answer

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C

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C

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B

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