Econ HW Questions

A 2 percent increase in the price of milk causes a 4 percent reduction in the quantity demanded of chocolate syrup. What is the cross-price elasticity of demand for chocolate syrup with respect to the price of milk?

-4/2 = -2 compliments

Which of the following jobs is least likely to be outsourced?

flipping hamburgers

In general, individuals and nations should specialize in producing goods ______ other individuals or nations.

for which they have a lower opportunity cost compared to

Suppose Colin brews beer and makes cheese. If Colin can increase his production of beer without decreasing his production of cheese, then he is producing at an:

inefficient point

If there is an excess supply of sport utility vehicles, then:

quantity supplied is greater than quantity demanded.

microeconomics differs from macroeconomics in that microeconomics focuses on:

the choices made by individuals and the implications of those choices

How would each of the following affect the U.S. market supply curve for corn? a. A new and more efficient plow is invented. The supply curve for corn would shift to the right Correct. b. The price of farmland falls. The supply curve for corn would shift to the right Correct. c. The government offers new farming subsidies. The supply curve for corn would shift to the right Correct. d. A tornado sweeps through Iowa. The supply curve for corn would shift to the left Correct.

yes

(Quiz 1) You will pay max $5 to get your car washed, but are willing to pay a minimum of $3 to wash someone else's. What is your economic surplus of washing it yourself?

$2

If Ana devotes all her time to making fudge, she can make 3 pounds of fudge an hour, and if she devotes all her time to making toffee, she can make 2 pounds of toffee an hour. If Leo devotes all his time to making fudge, he can make 4 pounds of fudge an hour, and if he devotes all his time to making toffee, he can make 5 pounds of toffee an hour. What is Leo's opportunity cost of making a pound of fudge?

1.25 pounds of toffee

1000 wheat a year and 500 corn a year. opportunity cost of producing one bushel of wheat is

1/2 corn

The following accompanying table shows the relationship between the speed of a computer's CPU and its benefits and costs. Assume that all other features of the computer are the same (that is, CPU speed is the only source of variation), and only the CPU speeds listed below are available for purchase. The total cost for a 2.5GHz computer total benefit = 1400 marginal cost = 100 inbetween 900 and 1200

1000

middle drift mine makes 75 tons/day. 15 workers. if they lose a worker the opportunity cost is

5 tons

julia makes a pie in 50 min, and a cake in 60. her opportunity cost of making a pie is

5/6 cake

prices and quantity 6=0 5=3,000 4=6,000 3=9,000 2=12,000 1=15,000 0=18,000

Calculate the price elasticity of demand at the point on the demand curve at which the price of bagels is $2 per pack. e=(2/12000)(3000/1) = 0.5 e=p/q x 1/slope

the study of individual choice and its implications for the behavior of prices and quantities in individual markets is

microeconomics

"Holding all other relevant factors constant, consumers will purchase more of a good as the price falls" This statement reflects the

Demand curve

What will happen to the equilibrium price and quantity of beef if stricter FDA inspections reduce the number of cattle ranches?

Equilibrium price will increase and equilibrium quantity will decrease.

Is the demand for a particular brand of car, like a Chevrolet, likely to be more or less price-elastic than the demand for all cars?

It's likely to be more elastic because of the availability of substitutes

Which of the following is NOT a characteristic of a market in equilibrium?

Neither buyers nor sellers want the price to change.

Among the following groups—senior executives, junior executives, and students—which is likely to have the most and which is likely to have the least price elastic demand for membership in the Association of Business Professionals?

The group with the most price elastic demand: students The group with the least price elastic demand: senior executives

What is not true about demand curves?

They reflect the seller's reservation price

if jane can produce 3 pairs of shoes per hour, and bob can only produce 2, jane has a what advantage?

absolute

the scarcity principle applies to

all decisions

an individual has an absolute advantage in producing pizzas if that individual:

can produce more pizzas in a given amount of time than anyone else

If a country's economic decisions are made by an individual or small number of individuals, then it has a:

centralized economy.

A demand curve is ______ sloping because ______.

downward; fewer people are willing to buy an item at higher prices

the study of economics is

how people make choices in the face of scarcity and the implications of those choices for society as a whole

the cost benefit principle indicates that an action should be taken if

it's extra benefit is greater than or equal to its extra cost

A demand curve is downward sloping because

more people find that the price is now less than their reservation price

an implication of scarcity is that

people must make trade offs

according to the incentive principle

people tend to do more of something when the benefits are greater.

If these proportions remain the same no matter how many slices are made, and the inputs can be purchased in any quantities at the stated prices, then the supply of slices is

perfectly elastic and the price elasticity of supply is infinite

positive economic principles are those that

predict how people will behave

All else equal, the jobs that are the least likely to be outsourced are those that:

require face to face communication

economists use abstract models because

they are useful for describing general patterns of behavior.

Indicate how you think each of the following would shift demand in the indicated market: a. The incomes of buyers in the market for new Honda Accords increases.The demand curve would shift to the right Correct. b. Buyers in the market for pizza read a study linking pepperoni consumption to improved health.The demand curve would shift to the right Correct. c. Buyers in the market for gas-powered cars learn of an increase in the price of electric cars (a substitute for gas-powered cars).The demand curve would shift to the right Correct. d. Buyers in the market for electric cars learn of an increase in the price of electric cars. The demand curve would remain unchanged Correct.

yes

if you have comparative advantage in a particular task, then:

you give up less to accomplish that task than do others