Econ Final chap 1
The diagram above shows a hypothetical demand curve for apples. The slope of this curve is: (Enter your response rounded to two decimal places. Include a minus sign if appropriate.)
-1
What is Annie's opportunity cost for producing apples in terms of cherries? That is, how many pounds of cherries does she give up per pound of apples? Enter the exact number as a decimal rounded to the nearest tenth of a pound.
0.5
What is Bret's opportunity cost for producing apples in terms of cherries? That is, how many pounds of cherries does he give up per pound of apples? Enter the exact number as a decimal rounded to the nearest tenth of a pound.
1
What is Bret's opportunity cost for producing cherries in terms of apples? That is, how many pounds of apples does he give up per pound of cherries? Enter the exact number as a decimal rounded to the nearest tenth of a pound.
1
In one equation, Y = 16 - 1.5X. In another equation, Y = 4 + 2.5 X When the two equation lines cross, the value of Y is:
11.5
If the initial value is 53 and the final value is 125, what is the percentage change? Enter your answer as a percentage number rounded to two decimal points. (Do not use the midpoint formula we discussed for elasticity here. Instead, just express the percentage using the initial value as the reference point.)
135.84
What is Annie's opportunity cost for producing cherries in terms of apples? That is, how many pounds of apples does she give up per pound of cherries? Enter the exact number as a decimal rounded to the nearest tenth of a pound.
2
In one equation, Y = 16 - 1.5X. In another equation, Y = 4 + 2.5 X When the two equation lines cross, the value of X is:
3
Output per day of work Apples Hats Country A 9 3 Country B 2 6 Using information in the previous table, what is country A's opportunity cost of producing 1 hat?
3
In the above graph, which of the following combinations of pies and cakes is unattainable given the existing resources?
3 cakes, 5 pies
The diagram above illustrates a hypothetical demand curve representing the relationship between price (in dollars per unit) and quantity (in 1,000s of units per unit of time). What is the the area of the triangle shown on the diagram? Remember the x axis is measured in thousands.
722,000
___________ occurs when production is in accordance with consumer preferences. ___________ occurs when a good or service is produced at the lowest possible cost.
Allocative Efficiency Productive efficiency
In which good does each farmer have a comparative advantage?
Annie has a comparative advantage in apples and Bret has a comparative advantage in cherries.
The information in this question refers to the next nine questions.Annie and Bret produce apples and cherries and originally live on their own farms and do not trade with each other. Their opportunity costs of producing each crop are constant.In one year, if Annie completely focuses on growing apples, she has 100 pounds of apples. If Annie completely focuses on growing cherries, she has 50 pounds of cherries.In one year, if Bret completely focuses on growing apples, he has 60 pounds of apples. If Bret completely focuses on growing cherries, he has 60 pounds of cherries.First: who has the absolute advantage in producing apples? Who has the absolute advantage in producing cherries? Explain why.
Annie has the absolute advantage in producing apples but Bret has the absolute advantage in producing cherries.
In the graphs shown, which country has a comparative advantage in the production of computer chips?
Country A
Using information in the previous table, who has the comparative advantage in producing hats?
Country B
On the diagram above, in relation to the production of automobiles, the movement along the curve from points C to B to A illustrates
Decreasing marginal opportunity costs
Which of the following is a positive economic statement?
Decreasing the price of bottled water causes an increase in the quantity of beer demanded.
In the above production possibilities frontier graph, which combination of goods is attainable yet inefficient?
F
Which of the following events would cause the supply curve to decrease to S2 from S1?
Higher expected future prices
Assume people become concerned that Corona beer causes a virus. From the list below, what happens in the market for Budweiser beer?I. Demand for Budweiser beer increases II. Supply for Budweiser beer increases III. Quantity demanded for Budweiser beer increases IV. Quantity supplied for Budweiser beer increases. V. Price of Budweiser beer increases. VI. Price of Budweiser beer decreases.
I., III., IV. and V.
Economists believe that an individual or firm should continue any activity until:
Marginal benefit is equal to marginal cost.
The United States is best classified as a:
Mixed economy
When we graph the relationship between two variables, we often want to draw conclusions about whether changes in one variable are causing changes in the other variable. Doing so, however, can lead to incorrect conclusions. The best reason below for drawing incorrect conclusions about cause and effect is:
Omitted variables and reverse causality
Which of the following is not a factor of production?
Pollution
Cheese is a key input in the production of pizza. Due to a drought, cheese gets more expensive. What happens to the price of pizza and the quantity of pizza demanded at equilibrium as a result of the drought?
Quantity demanded decreases and price increases
The baby boomers retire and there are suddenly millions more interested in obtaining more services for eye exams. At the same time, a surge of young workers go to optometry school and there are more people who provide eye exams.Which of the following can we say for sure?
Quantity demanded of eye exams increases and the price change of eye exams is ambiguous.
Economics is the study of choice under conditions of:
Scarcity
Which of the following will cause an outward (rightward) shift in supply for a good?
The cost of an input decreases.
The graph above shows the market for laptop computers. Suppose due to a trade war that rare earth metals become more expensive and rare earth metals are a crucial input for computers. How will this event impact on the equilibrium quantity and the market price?
The supply decreases, causing the equilibrium quantity to fall and the market price to rise.
Assume Annie eats 60 pounds of apples and 20 pounds of cherries when she does not trade and assume Bret eats 40 pounds of apples and 20 pounds of cherries when he does not trade. Suppose they then agree to specialize in the crop they are best in and then trade with each other. Are there more apples between the two of them after this arrangement? Are there more cherries between the two of them?
There are more cherries but not more apples.
Which of the following represents an inferior good?
When income goes up, the demand for peanut butter decreases.
Can Annie consume 60 pounds of apples and 20 pounds of cherries per year without trading with Bret?
Yes
Can Bret consume 40 pounds of apples and 20 pounds of cherries per year without trading with Annie?
Yes
On the diagram shown above, a movement from A to B represents __________.
a change in quantity demanded
The outward shift of the production possibilities frontier in the above graph would most likely be caused by:
a change in technology that only impacts the automobile industry
The basis for trade is
comparative advantage
A(n) entrepreneur is someone who operates a business, bringing together the factors of production—labor, capital, and natural resources—to produce goods and services.
entrepreneur
In the circular flow model of the economy, __________ are the suppliers of goods and services.
firms
If a country has a comparative advantage in the production of a good, then that country:
has a lower opportunity cost in the production of that good
The best reason below that economics is a social science is because:
of all of the reasons listed. it is based on studying the actions of individuals. it considers human behavior- particularly decision-making behavior. it applies the scientific method to the study of the interactions among individuals.
Absolute advantage is the ability of an individual, firm, or country to:
produce more of a good or service than competitors using the same amount of resources
Most economists agree that governments should:
protect property rights.
At the market equilibrium price:
quantity demanded equals quantity supplied
In the diagram above, when the price is $29 per unit, the amount of the ____ is ____ million.
shortage 56
The principle of increasing marginal opportunity cost states that the more resources devoted to any activity, the__________ the payoff to devoting additional resources to that activity.
smaller
In the above diagram, when supply increases from S1 to S2, a __________ develops at the original price. Equilibrium price will __________ and equilibrium quantity will __________ as a new equilibrium is established.
surplus, fall, rise
Given linear demand curves, if demand increases and supply decreases, then
the equilibrium price will increase but the effect on the equilibrium quantity will be ambiguous
Opportunity cost is:
the highest valued alternative that must be given up to engage in an activity.
All of the following scenarios depict the characteristics of complements except:
the price of milk decreases and the demand for eggs decreases.
