chapter 1 homework

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In which of the following areas will taking an economics course help benefit you throughout your​ life?

all of the above

The statement that the United States has a lower unemployment rate than Spain is a _____ statement since it describes what people_____

positive....... actually do

Suppose that you allocate​ $20 each week for your entertainment budget. This money is spent on two​ items: either renting movies for​ $1 each at Redbox or downloading songs from iTunes at​ $1 each. Given this​ information, which of the following would represent your budget constraint for​ entertainment?

Amount spent on iTunes​ + Amount spent at Redbox​ = $20.

How would you evaluate these options and choose an optimal​ one?

Do a​ cost-benefit analysis to compare the alternatives.

Which of the following is true regarding the concept of​ causation?

It describes how one event can bring about change in another.

Economics differs from these other social sciences because it also addresses these three key​ concepts: _________.

Optimization, equilibrium, and empiricism.

During the process of optimization economists believe that people are considering​ _________.

The feasibility of a choice, given the information available at the time.

​Let's say that you are trying to decide what to do on Friday at 11 a.m. You rank your possible options from the one you value the most to the one that you value the least in the following​ order: going to​ class, sleeping in​ late, going to work​ early, getting​ lunch, going to the gym to​ exercise, and watching television. If you decide to go to​ class, then what do we know about the opportunity cost of your​ decision?

The opportunity cost would be sleeping in​ late, since it was your​ next-best option.

Microeconomics studies​ _________, while macroeconomics studies​ _________.

a small piece of the overall​ economy; the economy as a whole.

The definition of economics states that it is the study of how​ _________.

agents choose to allocate scarce resources and the impact of those choices on society

Which of the following is subject to the​ free-rider problem?

all of the above

A surge in cocoa prices is _____ and a pest attack on the cocoa crop is______

an effect... the cause

Lower infant mortality is _____ and an improvement in nutrition is _____.

an effect... the cause

When making your decision about which activity to​ choose, you should consider the monetary cost _____ the opportunity cost of the activities. The goal is to choose the option that offers the greatest _____ benefit.

as well as... net

Policy decisions made by the government are analyzed by​ _________.

both microeconomics and macroeconomics.

Comparing a set of feasible alternatives and picking the best one is an optimization process called​ _________.

cost-benefit analysis

Which of the following is not an example of​ causation?

driving without car insurance will lead to getting into an accident.

empiricism describes a situation where ____

economists use data to analyze what is happening in the world

The amount produced by sellers must be_____ the amount purchased by buyers.

equal to

Buyers must place a value on the uses of the product that is _____ the cost of buying the product.

greater than

The costs of making a product must be ____ the final price at which the product sells.

less than

a policy such as whether to increase the money supply would be studied under ______, since it deals with ______

macroeconomics... the economy as a whole

equilibrium describes a situation where ______

no one would benefit from changing his or her behavior

The statement that the United States should legalize same-sex marriage is a _____ statement since it describes what people _____

normative..... ought to do

The ethical implications of a hotly debated government policy would best be considered a​ _________.

normative​ question, since it deals with a subjective issue based on personal preferences.

The goal of optimization for an individual is to maximize

overall well-being

optimization describes a situation where______

people weigh costs and benefits

Free riding occurs when _____ are out of sync with_____

people's private benefits... the public interest

Your budget constraint for entertainment illustrates the concept of_____, since as you increase your purchases of one​ item, you _____

trade-off.... must decrease your purchases of the other item

Which of the following is more susceptible to the​ free-rider problem: state parks or city-wide pest control?

use of city- wide pest control is more susceptible since even those who dont pay taxes still benefit, while state parks can charge for admission, so that everyone who goes pays their share

The opportunity cost of an activity is a measure of _____ when you do that activity.

what is given up

When deciding whether to install visible countdown timers for pedestrians at​ crosswalks, which of the following would be considered in the​ cost-benefit analysis? ​(Check all that apply.​)

1.The higher maintenance bill associated with fixing these more complex signals when they break down. 2. The value of the lives lost by drivers who watch the countdown timers and try to make it through a light. 3. The cost in terms of dollars of installing these new timers all over the city. 4. The value of the​ pedestrians' lives saved by having the timers to assist in crossing the street.


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