Question 1

You and a friend decide to go see a movie at the theater, spending $15 each on the tickets. Halfway through the movie you're struggling to stay awake and your friend is scrolling through Facebook. You suggest leaving the movie to do something else, since you're both obviously bored. However, your friend declines, stating he doesn't want to waste the $15 he spent on the ticket. Your friend is considering the ______ of the movie.

Accepted Answer

A)  opportunity cost
B)  sunk cost
C)  marginal benefit
D)  total costE) B) and C)
F) All of the above

Question 2

Thomas Malthus was an early 19th century economist who created a model describing the relationship between population growth and:

Accepted Answer

A)  war.
B)  birth control.
C)  crime.
D)  food production.E) A) and C)
F) None of the above

Question 3

An Italian restaurant decreases the price of pizza relative to the price of spaghetti, so customers buy more pizza. This is an example of responding to:

Accepted Answer

A)  marginal science.
B)  incentives.
C)  disincentives.
D)  sunk benefit.E) C) and D)
F) B) and D)

Question 4

Which of the following is an example of a positive statement?

Accepted Answer

A)  NCAA Football should have adopted a playoff system 10 years ago.
B)  An increase in the minimum wage results in higher teenage unemployment.
C)  No one should be allowed to carry guns into the classroom.
D)  Cats make better house pets than dogs.E) B) and D)
F) C) and D)

Question 5

Muhammad Yunus, founder of Grameen Bank, was a pioneer in implementing group responsibility to lend to the poor. Why wasn't someone else already doing it?

Accepted Answer

A)  The government regulated against group responsibility.
B)  The idea of group responsibility was genuinely new.
C)  Group responsibility lending was not profitable.
D)  It was easy for groups to provide false social security numbers for members that did not exist.E) All of the above
F) B) and D)

Question 6

Consider two neighbors who each run a small business. Juan grows and sells vegetables. Amber grows and sells flowers. Currently, Juan uses a herbicide on his vegetables, because he can grow more crops with the use of herbicide. Specifically, he earns $1,500 more during the years when he uses herbicide. Amber's flower farm is harmed by Juan's use of herbicide because it drifts to her farm and kills $3,000 worth of flowers each year. Which would be an efficient solution to this problem?

Accepted Answer

A)  The government bans the use of herbicide.
B)  Amber sells her flower business.
C)  Amber pays Juan $1,500 not to use a herbicide.
D)  There is no need for an intervention, as the current situation is efficient.E) C) and D)
F) None of the above

Question 7

Which of the following economic decisions would most likely be studied by a macroeconomist?

Accepted Answer

A)  Domino's Pizza decides to provide quantity discounts in order to increase revenue.
B)  A local entrepreneur decides to open a Waffle House in the local Walmart parking lot.
C)  The government of Estonia implements a flat rate personal income tax for all citizens.
D)  Prices for train fares rise as labor unions negotiate higher wage rates.E) A) and C)
F) All of the above

Question 8

Suppose Disney World decides to charge local residents a lower price than other park visitors. This would fall under which field of economics?

Accepted Answer

A)  Macroeconomics
B)  Public policy
C)  Customer service
D)  MicroeconomicsE) A) and B)
F) A) and C)

Question 9

After paying $12 to enter an all-you-can-eat buffet, you can eat as much food as you desire. Which of the following statements is true?

Accepted Answer

A)  The marginal benefit of your first plate of food is larger than the marginal benefit of your third plate of food.
B)  The marginal cost of a plate of food is sunk.
C)  You should eat as much as possible to maximize your benefit.
D)  It is inefficient to eat at buffet restaurants.E) All of the above
F) None of the above

Exam 1: Economics and Life

Muhammad Yunus, founder of Grameen Bank, was a pioneer in implementing group responsibility to lend to the poor. Why wasn't someone else already doing it?

Correct Answer
verified

Thomas Malthus was an early 19th century economist who created a model describing the relationship between population growth and:

Correct Answer
verified

Suppose Disney World decides to charge local residents a lower price than other park visitors. This would fall under which field of economics?

Correct Answer
verified

After paying $12 to enter an all-you-can-eat buffet, you can eat as much food as you desire. Which of the following statements is true?

Correct Answer
verified

Correct Answer
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Which of the following economic decisions would most likely be studied by a macroeconomist?

Correct Answer
verified

An Italian restaurant decreases the price of pizza relative to the price of spaghetti, so customers buy more pizza. This is an example of responding to:

Correct Answer
verified

Correct Answer
verified

Which of the following is an example of a positive statement?

Correct Answer
verified

Exam 1: Economics and Life

Muhammad Yunus, founder of Grameen Bank, was a pioneer in implementing group responsibility to lend to the poor. Why wasn't someone else already doing it?

Correct AnswerverifiedShow Answer

Thomas Malthus was an early 19th century economist who created a model describing the relationship between population growth and:

Correct AnswerverifiedShow Answer

Suppose Disney World decides to charge local residents a lower price than other park visitors. This would fall under which field of economics?

Correct AnswerverifiedShow Answer

After paying $12 to enter an all-you-can-eat buffet, you can eat as much food as you desire. Which of the following statements is true?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following economic decisions would most likely be studied by a macroeconomist?

Correct AnswerverifiedShow Answer

An Italian restaurant decreases the price of pizza relative to the price of spaghetti, so customers buy more pizza. This is an example of responding to:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following is an example of a positive statement?

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
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