microeconomics week 1
Juan has a monthly budget of $100 to spend on entertainment. A concert ticket costs $20 while a movie ticket costs $10. This month Juan has attended one concert and 5 movies so far. If Juan decides to only go to movies for the rest of the month. How many movie tickets can he afford to purchase and stay within his budget?
3 tickets
Sydney is putting together an economic model to predict the revenue from the sale of her famous cream pies based on their price and the prices of the pie shops nearby. What is the best tool to build the model?
a mathematical function
An equation where X=5 could be represented on a graph where Y is on the vertical axis and X is on the horizontal axis as
a single point (X=5) and a vertical line upwards from that point.
Dawnell is a skilled dancer. She is currently teaching modern dance full time for three high schools and makes $44,000 a year. She is now giving up her work and joining a touring dance company for the next two years. She will make $24,000 a year dancing, but gain much more in experience and connections. Dawnell's decision will result in
a two year opportunity cost of $40,000 after leaving her teaching position.
Self-interest is not necessarily selfish, some say. In fact, self-interest likely includes an individual's consideration for
close friends and family
Making an economically rational decision requires
considering the prospective benefits and costs to oneself.
If Stan's Shoemaker Shop practices the division of labor and each employee concentrates on one step of the shoe-making process, this will likely result in
greater output produced.
Congress must vote whether to increase the government budget so as not to shut down the government this year. The vote passed and the budget ceiling has been increased to keep the government running. This is an example of what type of policy?
macroeconomic fiscal policy
The additional benefit that one more unit of something will provide is known as
marginal benefit
To make an economically rational decision, marginal cost should be compared to
marginal benefit
If Kendrick decides to watch t.v. instead of going to the gym, the ________ of his decision is a missed workout.
opportunity cost
When certain assumptions are used to create an economic model, the value of the model can be tested by its ability to
predict outcomes
The production possibilities model illustrates an inverse relationship between the quantity of two goods or services produced because
production of different products will compete for limited resources.
Financial capital, like money, is simply a tool. Once financial capital is converted to economic capital (invested), it produces a resource that is
productive
In order to satisfy as many wants as possible, it is necessary to achieve allocative efficiency,
since otherwise output may go to where it is less valued.
Identify the normative statement(s) among the following statement(s).
the federal gov spends too much (opinion)
In the case of a positive relationship between two variables, all else remaining constant:
the values of the two variables will move in the same direction.
When picking up a rental car at an airport car rental agency, some travelers stand in line waiting to sign paperwork and pick up car keys at the rental desk while other travelers can go right to their rental car by using their rental car loyalty club card. In this example, the travelers who move quickly through to the parking lot pick up their car are probably
travelers who value convenience more than those waiting in line and are willing to pay additional club fees for the option of avoiding them.
Given that total spending for a certain household will always include a base amount of $1000/month, and that additional spending is equal to half of any income earned, we can predict total household spending with a model y=b+mx, where
x represents income earned.