MACRO QUIZ1

Economics is the study of the​ ________ people make to attain their​ goals, given their​ ________ resources. A. ​choices; scarce B. ​decisions; household C. ​income; available D. ​purchases; unlimited

A.

Scarcity refers to the situation in which A. unlimited wants exceed limited resources. B. a​ nation's poverty level increases faster than its population. C. a​ country's population is larger than its resource base. D. unlimited resources exceed limited wants.

A.

The Farm​ Factory, a booth at the local​ Farmer's Market, sells fresh eggs for​ $1.50 per dozen and fresh milk for​ $2.50 per gallon. What is the opportunity cost of buying a dozen​ eggs? A. ​3/5 of a gallon of milk .B. ​$1.50 C. ​$2.50 D. 1​ 2/3 gallons of milk

A.

Which of the following is a macroeconomics​ question? A. What determines the unemployment​ rate? B. How is the production quantity of digital cameras​ determined? C. What determines the wages and benefits of flight​ attendants? D. What factors determine the price of​ iPhones?

A.

​Cassie's Quilts​ alters, reconstructs, and restores heirloom quilts. Cassie has just spent​ $800 purchasing,​ cleaning, and reconstructing an antique quilt which she expects to sell for​ $1,500 once she is finished. After having spent​ $800, Cassie discovers that she would need some special period fabric that would cost her​ $200 in material and time in order to complete the task. ​ Alternatively, she can sell the quilt​ "as is" now for​ $900. What is the marginal cost of completing the​ task? A. ​$200 .B. ​$500 Your answer is not correct.C. ​$1,000 D. ​$1,000 plus the value of her time

A.

​________ involves undertaking an activity until its marginal benefits equal marginal costs. A. Marginal analysis .B. Central planning C. Scarcity reduction D. Market intervention

A.

An office supply store sells a ream of printer paper at a fixed price of​ $4.50. Which of the following is a term used by economists to describe the money received from the sale of an additional ream of​ paper? A. marginal costs B. marginal revenue .C. net benefit D. pure profit E. gross earnings

B.

Economists assume that rational people A. only weigh the benefits and costs of the most desirable alternative actions. B. respond to economic incentives. C. never use all available information as they act to achieve their goals. D. undertake activities that benefit others and hurt themselves.

B.

There is often a trademinus−off between A. productive efficiency and allocative efficiency. B. economic efficiency and economic equity. C. limited and unlimited resources. D. voluntary and involuntary exchanges.

B.

What does the term​ "marginal" mean in​ economics? A. secondary B. an additional or extra C. trivial D. illegal E. the edge of a market

B.

Which of the following is a macroeconomics​ question? A. How is the production quantity of digital cameras​ determined? B. What determines the unemployment​ rate? C. What determines the wages and benefits of flight​ attendants? D. What factors determine the price of​ iPhones?

B.

Which of the following statements is​ true? A. An inverse relationship has a positive slope value. B. A curved line has slope values that change at every point. C. A direct relationship has a negative slope value. D. A straight line has a slope of one.

B.

​Cassie's Quilts​ alters, reconstructs, and restores heirloom quilts. Cassie has just spent​ $800 purchasing,​ cleaning, and reconstructing an antique quilt which she expects to sell for​ $1,500 once she is finished. After having spent​ $800, Cassie discovers that she would need some special period fabric that would cost her​ $200 in material and time in order to complete the task. ​ Alternatively, she can sell the quilt​ "as is" now for​ $900. What should she​ do? A. She should cut her losses and sell the quilt now. B. She should purchase the period​ fabric, complete the task and then sell the quilt. C. She should not do any more work on the quilt because she has already spent too much time on it and has not been paid for that time. D. It does not matter what she​ does; she is going to take a loss on her project.

B.

​Zane's Vanes is a service that restores old weather vanes. Zane has just spent​ $125 purchasing a​ 1920s-era weather vane which he expects to restore and sell for​ $500 once the work is completed. After having spent​ $125, Zane realizes that he will need to spend an additional​ $200 on materials to complete the restoration.​ Alternatively, he can sell the weather vane without restoring it for​ $200. What should he​ do? A. It does not matter what he​ does; he is going to take a loss on the project. B. He should finish the restoration and then sell the weather vane. C. He should sell the weather vane now to make the most profit. D. He should sell the weather vane back to the party he purchased it from and cut his losses.

B.

At a recent company​ meeting, Geraldine​ Erwin, sales manager of​ Dastoria, a​ flavored-beverage producer​ announced, "We have increased our sales by 8 percent in just six​ months." Suppose six months​ ago, its sales amounted to​ $452,000, what is the value of its sales​ today? A. ​$36,160 B. ​$415,840 C. ​$488,160 D. ​$565,000

C.

Opportunity cost is defined as A. the benefit of an activity. B. the monetary expense associated with an activity. C. the highest valued alternative that must be given up to engage in an activity. .D. the total value of all alternatives that must be given up to engage in an activity.

C.

The Stogie​ Shop, a cigar store in the​ mall, sells handminus−rolled cigars for​ $10.00 and machineminus−made cigars for​ $2.50 each. What is the opportunity cost of buying a handminus−rolled ​cigar? A. one−quarter of a machine−made cigar B. ​$2.50 C. 4 machine−made cigars D. ​$10.00

C.

The term​ "market" in economics refers to A. an organization which sells goods and services. B. a place where money changes hands. C. a group of buyers and sellers of a product and the arrangement by which they come together to trade. D. a legal institution where exchange can take place.

C. a group of buyers and sellers of a product and the arrangement by which they come together to trade.

Economists assume that A. people put other​ people's interests ahead of their own. B. consumer behavior is explained by the existence of unlimited resources. C. individuals behave in unpredictable ways. D. optimal decisions are made at the margin

D.

In the first six months of​ 2003, branches of Commerce Bank in New York City were robbed 14 times. The New York City Police recommended steps the bank could take to deter​ robberies, including the installation of plastic barriers called​ "bandit barriers." The police were surprised the bank did not take their advice. According to a deputy commissioner of​ police, "Commerce does very little of what we recommend.​ They've told our detectives they have no interest in ever putting in the​ barriers." It would seem that Commerce Bank would have a strong incentive to install​ "bandit barriers" to deter robberies. Why​ wouldn't they do​ it? A. The banks would rather delay installation of any theft deterring equipment in anticipation of​ new, lower-cost innovations in the security devices market. B. The banks are concerned that​ "bandit barriers" would send the wrong message to customers long dash— that the bank is unsafe. C. The banks probably resent any interference from the police department. D. The banks must have weighed the cost of installing bandit barriers against the benefits and decided that they have​ "no interest in ever putting in the​ barriers."

D.

In​ 2015, Smileytown consumed​ 50,000 tubes of toothpaste. In​ 2016, toothpaste consumption rose to​ 62,000 tubes. Calculate the percentage change in toothpaste consumption. A. ​12% B. ​16.42% C. ​19.35% D. ​24%

D.

Lydia runs a small nail salon in the town of New Hope. She is debating whether she should extend her hours of operation. Lydia figures that her sales revenue will depend on the number of extra hours the nail salon is open as shown in the table to the right. She would have to hire a worker for those extra hours at a wage rate of​ $10 per hour. Using marginal​ analysis, by how many hours should Lydia extend her nail​ salon's hours of​ operations? Extra Hours open 1,2,3,4,5,6 Total Revenue 50,75,95,110,120,125 A. 2 hours B. 3 hours C. 4 hours D. 5 hours E. 6 hours

D.

Suppose when the price of hybrid automobiles​ rises, consumers buy fewer hybrid automobiles. This implies that A. there is a direct relationship between hybrid automobile prices and quantities purchased by consumers. B. there is a oneminus−tominus−one relationship between hybrid automobile prices and quantities purchased by consumers. C. there is a positive relationship between hybrid automobile prices and quantities purchased by consumers. D. there is a negative relationship between hybrid automobile prices and quantities purchased by consumers.

D.

If the price of milk was​ $1.25 a gallon and it is now​ $2.25 a​ gallon, what is the percentage change in​ price? A. 4.4 percent B. 8 percent C. 44 percent D. 80 percent

D. To calculate percentage decrease: First: work out the difference (decrease) between the two numbers you are comparing. Then: divide the decrease by the original number and multiply the answer by 100. If your answer is a negative number then this is a percentage increase.

As population​ declines, scarcity eventually disappears. A. True B. False

FALSE