ECO TEST #2
C
42. Using the table above, what is the marginal product of the 5th worker hired at Decent Donuts? A) 64 dozen donuts per day B) 17.2 dozen donuts per day C) 22 dozen donuts per day D) 86 dozen donuts per day
D
43. Based on the data in the table above, what is the average product of labor when Decent Donuts employs five workers? A) 20 dozen donuts per day B) 22 dozen donuts per day C) 16.66 dozen donuts per day D) 17.2 dozen donuts per day
B
44. Based on the data in the table above, after which worker is hired do diminishing marginal returns begin? A) the first B) the sixth C) the fifth D) the ninth
A
45. Using the data in the above table, what is the marginal product of the second worker? A) 4 pizzas per hour B) 5 pizzas per hour C) 4.5 pizzas per hour D) The marginal product is undefined.
B
46. In the above table, the total cost of producing 9 units of output is A) $30. B) $70. C) $20. D) $50.
A
47. In the above table, the total variable cost of producing 16 units of output is A) $100. B) $20. C) $60. D) $120.
D
48. Using the data in the above table, when output increases from 4 to 9 units, the marginal cost of one of those 5 units is A) $4.00. B) $4.25. C) $6.25. D) $5.00.
D
49. Using the data in the above table, the average fixed cost of producing 9 units per day is A) $5.00. B) $20.00. C) $5.55. D) $2.22.
12.5
51. Using table above, what is the marginal cost when we change the production from 16 to 18 units? 145-120/18-16=25/2=?
B
A 10 percent increase in the quantity of spinach demanded results from a 20 percent decline in its price. The price elasticity of demand for spinach is A. 2.0. B. 0.5. C. 20.0. D. 10.0.
A
A company could produce 99 units of a good for $316 or produce 100 units of the same good for $320. The marginal cost of the 100th unit A. is $4.00 B. is $3.20. C. is $320. D. cannot be calculated with this information.
C
A contest is a good way to allocate scarce resources when A) the lines of responsibility are clear. B) there is no effective way to distinguish among potential users. C) the efforts of the players are hard to monitor directly. D) the decision being made affects a large number of people.
A
A cost that has already been made and cannot be recovered is called a A. sunk cost. B. fixed cost. C. marginal cost. D. variable cost.
B
A market demand curve is constructed by A. a vertical summation of each individual demand curve. B. a horizontal summation of each individual demand curve. C. dividing one individual demand curve by the number of consumers in the market. D. averaging each individual demand curve.
A
Alice is willing to pay $3 for the second slice of pizza she eats. The price she pays is $2. Alice's consumer surplus for this slice of pizza equals A. $1. B. $2. C. $3. D. $0.
D
Allocating resources by the order of someone in authority is a ________ allocation method. A. market price B. majority rule C. first−come, first−served D. command
B
An example of a shortminus−run fixed factor of production is A. labor. B. capital equipment. C. electricity. D. postage for mailing.
A
An example of a variable resource in the short run is A. an employee. B. land. C. capital equipment. D. a building.
A
At the quantity of 200 bushels of apples, the marginal social benefit of a bushel of apples is $100 and the marginal social cost is $50. To produce the efficient quantity of apples, A. more apples should be produced. B. fewer apples should be produced. C. there should be no change in the amount of apples produced. D. More information on the willingness of consumers to purchase apples is needed to determine the efficient level of apples.
B
Average total costs are A. the change in total costs divided by the change in output. B. total costs divided by total output. C. total output divided by total costs. D. the change in output divided by the change in total costs.
A
14. Jill and Jed have individual demand curves for tennis rackets given in the table above and are the only two demanders in the market. What is the market quantity demanded at the price of $20? A) 7 B) 2 C) 11 D) 18
D
15. In the figure above, when the price of a CD is $8.00, total producer surplus from all the CDs will be A) greater than at $10.00 per CD. B) zero. C) $20 million. D) $10 million.
C
16. In the figure above, when production is 3 units with a price of $3, the consumer surplus equals A) a + b + f + g + h + l. B) a + b + f + g + h + l + i + m. C) a + b. D) a + b + f + g.
A
17. In the figure above, when production is 3 units with a price of $3, the producer surplus in this market equals A) f + g. B) b + g. C) a + b + f + g. D) a + b + f + g + h + i.
A
18. In the above figure, when the price of pretzels is $3.00 per pound, the total producer surplus from all the pretzels will be A) the sum of the difference between $3.00 and the marginal cost of all the pounds produced. B) less than at any other price. C) zero. D) greater than at any other price.
A
19. The above figure shows Dana's marginal benefit curve for ice cream. If the price of ice cream is $2 per gallon, then the maximum that Dana is willing to pay for the 8th gallon of ice cream is A) $3. B) $5. C) $2. D) $1.
D
20. The figure above shows Clara's demand for CDs. The price for a CD is $10. Which statement is TRUE? A) When Clara buys 6 CDs, she receives a total of $30 of consumer surplus. B) When Clara buys 8 CDs, she receives $45 of consumer surplus on her 6th CD. C) When Clara buys 8 CDs, she receives a total of $45 of consumer surplus. D) When Clara buys 8 CDs, she receives a total of $80 of consumer surplus.
D
21. The figure illustrates the market for bagels. If the number of bagels is cut from 20 to 10 an hour, the deadweight loss is ________. A) -$5.00 an hour B) $0.50 a bagel C) $0 an hour D) $5.00 an hour
A
22. In the above figure, when the efficient quantity is produced the marginal social cost of the last magazine is A) $3. B) $5. C) $1. D) some amount not given in the above three answers.
C
23. In the above figure, when the efficient quantity is produced the marginal social benefit of the last magazine is A) $1. B) $5. C) $3. D) some amount not given in the above three answers.
A
24. The price ceiling depicted in the above figure results in A) producer surplus decreasing from $24 thousand to $6 thousand. B) consumer surplus increasing from $30 thousand to $34.5 thousand. C) a deadweight loss of $16 thousand. D) Both answers A and B are correct.
C
25. The figure above shows the demand for and supply of rental housing in Smallton. If a rent ceiling is set at $800, how many apartment units are rented? A) 4,000 B) 2,000 C) 3,000 D) None of the above answers is correct.
C
26. The figure above shows the demand for and supply of rental housing in Smallton. If a rent ceiling is set at $800, what is the rent? A) $400 B) $800 C) $600 D) None of the above answers is correct.
D
27. The figure above shows the demand for and supply of rental housing in Smallton. If a rent ceiling is set at $800, there is A) a shortage of 3,000 units of rental housing. B) a surplus of 3,000 units of rental housing. C) a shortage of 6,000 units of rental housing. D) neither a shortage nor a surplus of rental housing.
B
28. The figure above shows the demand for and supply of rental housing in Smallton. If a rent ceiling is set at $400, how many apartment units are rented? A) 4,000 B) 2,000 C) 3,000 D) None of the above answers is correct.
C
29. The figure above shows the demand for and supply of rental housing in Smallton. If a rent ceiling is set at $400, what is the rent? A) $600 B) $800 C) $400 D) None of the above answers is correct.
B
3. The table above gives the demand schedule for snow peas. The price elasticity of demand between $6.00 and $7.00 per bushel is A) 1.0. B) 2.6. C) 2.0. D) 5.0.
B
30. The figure above shows the demand for and supply of rental housing in Smallton. If a rent ceiling is set at $400, there is A) a surplus of 3,000 units of rental housing. B) a shortage of 2,000 units of rental housing. C) a shortage of 4,000 units of rental housing. D) neither a shortage nor a surplus of rental housing.
B
31. The figure above shows the demand for and supply of labor of students in Smallville. If the minimum wage is set at $4 per hour, how many hours do students work? A) 6,000 hours B) 9,000 hours C) 12,000 hours D) None of the above answers is correct.
B
32. The figure above shows the demand for and supply of labor of students in Smallville. If the minimum wage is set at $4 per hour, how many hours of students' labor are unemployed? A) 6,000 hours B) 0 hours C) 12,000 hours D) 9,000 hours
B
33. The figure above shows the demand for and supply of labor of students in Smallville. If the minimum wage is set at $6 per hour, how many hours do students work? A) 6,000 hours B) 9,000 hours C) 12,000 hours D) None of the above answers is correct.
D
34. The figure above shows the demand for and supply of labor of students in Smallville. If the minimum wage is set at $6 per hour, how many hours of students' labor are unemployed? A) 9,000 hours B) 6,000 hours C) 12,000 hours D) 0 hours
B
35. The figure above shows the demand for and supply of labor of students in Smallville. If the minimum wage is set at $8 per hour, how many hours do students work? A) 12,000 hours B) 6,000 hours C) 9,000 hours D) None of the above answers is correct.
B
36. The figure above shows the demand for and supply of labor of students in Smallville. If the minimum wage is set at $8 per hour, how many hours of students' labor are unemployed? A) 9,000 hours B) 6,000 hours C) 0 hours D) 12,000 hours
A
40. In the figure above, the marginal product of the second worker is A) 5 units. B) 10 units. C) 1 units. D) 2 units.
B
41. n the above figure, an unattainable point is A) a. B) g. C) f. D) e.
B
A minimum wage set above the equilibrium wage rate for lowminus−skilled workers ________. A. creates more employment opportunities for lowminus−skilled workers B. creates unemployment among lowminus−skilled workers C. creates more prosperity among younger people D. increases the number of good paying jobs available to young people
A
A normal good is defined as a good for which the demand curve A. shifts rightward as income increases. B. shifts leftward as income increases. C. is perfectly price elastic. D. slopes downward to the right.
A
A period of time in which the quantity of all factors of production used by a firm can be varied is called the A) long run. B) market period. C) short run. D) variable run.
D
A price ceiling can result in which of the following? A. increased search activities B. inefficiency C. black markets D. All of the above answers are correct.
A
A price ceiling is a price A. above which a seller cannot legally sell. B. below which a seller cannot legally sell. C. that creates a surplus of the good. D. Both answers A and C are correct.
D
A price floor is a price A. below which a seller cannot legally sell. B. above which a seller cannot legally sell. C. that creates a surplus of the good if it is set above the equilibrium price. D. Both answers A and C are correct.
B
A rent ceiling creates a shortage. As a result, which of the following occurs? A. only a loss of producer surplus for landlords B. a loss of both consumer and producer surplus C. only a loss of consumer surplus for tenants D. a gain of both consumer and producer surplus
B
A rent ceiling set above the equilibrium rent A. decreases both the quantity demanded and the quantity supplied. B. has no effect on the market outcome. C. decreases the quantity demanded but not the quantity supplied. D. decreases the quantity supplied but not the quantity demanded.
A
A university conducts a survey of students, which shows that a 10 percent tuition hike would lead to a 12 percent decrease in the enrollment. If the university wants to increase its total revenue, it should ________ tuition because the demand for education at this university is ________. A. not raise; elastic B. raise; inelastic C. raise; elastic D. not raise; inelastic
C
After constructing a new factory, the cost of building the factory is a A) past cost. B) variable cost. C) sunk cost. D) None of the above answers are correct.
A
Aglets are the metal or plastic tips on shoelaces that make it easier to lace your shoes. The demand for aglets is probably A. inelastic. B. perfectly elastic. C. unit elastic. D. elastic but not perfectly elastic.
B
A firm's total fixed cost (TFC) is defined as a cost A. that is dependent on marginal cost. B. that does not change as output changes. C. it is certain ("fixed") that the firm must pay. D. that is paid in only the long run.
C
A firm's total product curve shows that at first it has A. economies of scale and then diseconomies of scale. B. diseconomies of scale and then economies of scale. C. increasing marginal returns and then diminishing marginal returns. D. diminishing marginal returns and then increasing marginal returns.
B
A firm's total variable cost (TVC) is defined as a cost that A. varies only when the firm reaches the long run. B. changes as the firm changes its output. C. does not change (is not "variable") as the firm changes its output. D. falls as the firm increases its output.
D
Because there are numerous choices for fast food purchases, the price elasticity of demand for Taco Bell food is likely A) unitary elastic. B) perfectly inelastic. C) inelastic. D) elastic.
A
Blue pens and black pens are close substitutes. The cross elasticity of demand for black pens with respect to the price of blue pens is ________. A. positive B. zero C. equal to 1 D. negative
B
Bus rides and canned soup are inferior goods, so the ________ elasticity of demand is ________. A. cross; positive B. income; negative C. cross; negative D. income; positive
D
Consumer surplus is the A. value of a good expressed in dollars. B. value of a good plus the price paid for it summed over the quantity bought. C. price of a good expressed in dollars. D. value of a good minus the price paid for it summed over the quantity bought.
A
Dan sells newspapers. Dan says that a 4 percent increase in the price of a newspaper will decrease the quantity of newspapers demanded by 8 percent. According to Dan, the demand for newspapers is ________. A) elastic B) perfectly elastic C) inelastic D) unit elastic
A
Dan sells newspapers. Dan says that a 4 percent increase in the price of a newspaper will decrease the quantity of newspapers demanded by 8 percent. According to Dan, the demand for newspapers is ________. A. elastic B. unit elastic C. inelastic D. perfectly elastic
B
Demand is income elastic if A. an increase in income does not affect the quantity demanded. B. a small percentage increase in income results in a large percentage increase in quantity demanded. C. the good in question has close substitutes. D. a large percentage increase in income results in a small percentage increase in quantity demanded.
A
Demand is unit elastic when A. a change in the price of the product leads to no change in the total revenue. B. the slope of the demand curve is minus−1. C. a shift of the supply curve leads to no change in price. D. a shift of the supply curve leads to an equal shift of the demand curve.
B
Donuts and coffee are complements. When the price of a donut increases, the demand for coffee ________ and the cross elasticity of demand for coffee with respect to the price of a donut is ________. A. increases; negative B. decreases; negative C. decreases; positive D. increases; positive
B
If a person will rent an apartment only to married couples over 30 years old, that person is allocating resources using a ________ allocation method. A. command B. personal characteristics C. first−come, first−served D. market price
B
If demand for Farmer John's maple syrup is inelastic, then when Farmer John raises the price of maple syrup, his total revenue will A. decrease. B. increase C. stay the same. D. probably change, but more information is needed to determine if the total revenue increases, decreases, or stays the same.
C
If demand is inelastic, an increase in the price will A. not change total revenue. B. decrease total revenue. C. increase total revenue. D. increase the quantity demanded.
B
If goods are complements, then their A. income elasticities are positive. B. cross elasticities are negative. C. cross elasticities are positive. D. income elasticities are negative.
B
If hot dog vendors at baseball games want to maximize their total sales revenue, they will have to A. raise their price, even if it means selling fewer hot dogs. B. set the price of their hot dogs so that the demand is unit elastic. C. be willing to experience reduced hot dog expenditure by baseball fans. D. sell as many hot dogs as they can, even if it means lowering price.
A
If policy makers believe that the equilibrium wage rate is too low, policy makers can raise wages by legislating a "minimum wage," that is, a wage A. floor above the equilibrium wage. B. ceiling above the equilibrium wage. C. ceiling below the equilibrium wage. D. floor below the equilibrium wage.
D
If the income elasticity for chocolate chip cookies is 1.84, then chocolate chip cookies are A. a normal good and income inelastic. B. an inferior good and income inelastic. C. an inferior good and income elastic. D. a normal good and income elastic.
D
If the price of salt increases and the quantity demanded does not change, then A) the price elasticity of demand is equal to zero. B) demand is perfectly inelastic. C) the demand curve for salt is horizontal. D) Both answers A and B are correct.
A
In order to have an effect, a price ceiling must be set ________. A. below the equilibrium price B. by suppliers C. above the equilibrium price D. equal to the equilibrium price
A
Increasing marginal returns to labor might occur at low levels of labor input because of A. increasing specialization of tasks. B. differing factor proportions. C. decreasing use of machinery and increasing use of technology. D. increasing average costs.
C
Jane is willing to pay $50 for a pair of shoes. The actual price of the shoes is $30. Her consumer surplus on this pair of shoes is A. $50. B. $80. C. $20. D. $30.
A
Marginal benefit A. is the maximum amount a person is willing to pay for one more unit of a good. B. is the same as the total benefit received from consuming a good. C. is the difference between total benefit and total cost. D. increases as consumption increases.
D
Marginal cost is A. zero at the efficient level of production. B. the total opportunity cost of producing all the units of the good. C. the same as the marginal benefit because producers benefit from the money they receive when they sell the good. D. the opportunity cost of producing one more unit.
A
Marginal cost is equal to A. the change in total cost divided by the change in quantity. B. total cost divided by quantity. C. the change in total cost divided by the change in total revenue. D. quantity divided by total cost.
D
Producer surplus is the A. demand for a good minus the supply summed over the quantity sold. B. opportunity cost of producing it summed over the quantity sold. C. cost of the good summed over the quantity sold. D. price of a good minus the opportunity cost of producing it summed over the quantity sold.
command system
Resources are allocated by the order of someone in authority.
first-come, first-serve
Resources are allocated to the first in line.
force
Resources are allocated to the strongest.
lottery
Resources are allocated to those who pick the winning number.
A
Sal likes to eat pizza. The ________ is the maximum amount that Sal is willing to pay for one more piece of pizza. A) marginal benefit B) marginal cost C) efficient amount D) efficient price
A
Supply is elastic if A. a 1 percent change in price leads to a larger percentage change in quantity supplied. B. the slope of the supply curve is positive. C. a 1 percent change in price leads to a smaller percentage change in quantity supplied. D. the good in question is a normal good.
C
Suppose a 10 percent increase in the price of textbooks decreases the quantity demanded by 20 percent. The elasticity of demand for textbooks is A) 10.0. B) 5.0. C) 2.0. D) 0.2.
A and B
The ________ the portion of your income spent on a good, the ________ is your demand for the good. A) larger; more price elastic B) smaller; less price elastic C) smaller; more income elastic D) larger; more income elastic
D
The air route from Dallas to Mexico City is served by more than one airline. The demand for tickets from American Airlines for that route is probably A. inelastic but more elastic than the demand for all tickets for that route. B. inelastic and less elastic than the demand for all tickets for that route. C. elastic but less elastic than the demand for all tickets for that route. D. elastic and more elastic than the demand for all tickets for that route.
A
The amount of time elapsed since a price change impacts the elasticity of demand because as more time passes, A) people can find more substitutes, and so the elasticity of demand increases. B) the good's price will have a chance to return to its previous level. C) people can find more substitutes, and so the elasticity of demand decreases. D) people's incomes will increase, and so the elasticity of demand decreases.
B
The average product of labor is equal to the A. total number of workers hired divided by the total product. B. total product divided by the total number of workers hired. C. slope of the marginal product of labor curve. D. Both answers B and C are correct.
C
The cross elasticity of demand measures the responsiveness of the quantity demanded of a particular good to changes in the prices of A. its complements but not its substitutes. B. its substitutes but not its complements. C. its substitutes and its complements. D. neither its substitutes nor its complements.
A
The elasticity of supply measures the sensitivity of A. quantity supplied to a change in price. B. quantity supplied to quantity demanded. C. price to changes in supply. D. supply to changes in costs.
B
The income elasticity of demand is a measure of the responsiveness of the A. consumer's income to a change in the price of the goods he or she consumes. B. quantity of a good demanded to changes in income. C. quantity of a good demanded to changes in its price. D. quantity of a good demanded to changes in another good's price.
D
The income elasticity of demand is largest for A. food. B. shelter. C. clothing. D. luxuries.
A
The law of diminishing returns states that as A. a firm uses more of a variable input, given the quantity of fixed inputs, the marginal product of the variable input eventually diminishes. B. a firm uses more of a variable input, given the quantity of fixed inputs, the firm's average total cost will decrease eventually. C. the size of a plant increases, the firm's fixed cost increases. D. the size of a plant increases, the firm's fixed cost decreases.
A
The long run is a time frame in which A. the quantities of all resources can be varied. B. all costs are sunk costs. C. the quantities of all resources are fixed. D. the quantities of some resources are fixed and the quantities of other resources can be varied.
C
The marginal cost curve A. shows the maximum price that a producer must receive to induce it to produce a unit of a good or service. B. is the same as the demand curve. C. shows the minimum price sellers must receive to produce a unit of a good or service. D. shows what buyers are willing to give up to get one more unit of a good or service.
C
The marginal product of labor is equal to the A. slope of the marginal product of labor curve. B. total product divided by the total number of workers hired. C. increase in the total product that results from hiring one more worker. D. None of the above answers are correct.
B
The market supply curve is also the A. marginal value curve. B. marginal social cost curve. C. marginal social benefit curve. D. maximum−supply−price curve.
B
The more substitutes available for a product, the A) smaller is its price elasticity of demand. B) larger is its price elasticity of demand. C) larger is its income elasticity of demand. D) smaller is its income elasticity of demand.
B
The price elasticity of demand for DVDs is 2. If the price of a DVD increased by 2 percent, the quantity demanded will ________. A. not change B. decrease by 4 percent C. decrease by 1 percent D. decrease by 2 percent
A
The price elasticity of demand for furniture is estimated at 1.3. This value means a one percent increase in the A. price of furniture will decrease the quantity of furniture demanded by 1.3 percent. B. quantity of furniture demanded will decrease the price of furniture by 1.3 percent. C. quantity of furniture demanded will increase the price of furniture by 1.3 percent. D. price of furniture will increase the quantity of furniture demanded by 1.3 percent.
A
The price elasticity of demand is equal to the ________ in the ________ divided by the ________ in the ________. A. percentage change; quantity demanded; percentage change; price B. change; price; change; quantity demanded C. percentage change; price; percentage change; quantity demanded D. change; quantity demanded; change; price
A
The price elasticity of demand measures A. the responsiveness of the quantity demanded to changes in price. B. how sensitive the quantity demanded is to changes in demand. C. how often the price of a good changes. D. the slope of a budget curve.
C
The price elasticity of supply is calculated as the A. quantity supplied divided by the per unit cost of production. B. percentage change in price divided by the percentage change in quantity demanded. C. percentage change in quantity supplied divided by the percentage change in price. D. quantity supplied divided by the percentage change in quantity demanded.
D
The price elasticity of supply of laptop computers equals 1.5 if A. for every $1.00 that laptops increase in price, computer makers produce another 150 laptops. B. a rightward shift of the demand curve for laptops causes the quantity supplied to increase by 1.5 percent. C. a rightward shift of the demand curve for laptops causes a 1.5 percent increase in their price. D. for every 1 percent that laptop prices increase, computer makers produce another 1.5 percent laptops.
D
The price of milk rises, so the supply of ice cream decreases. there is, as a result a 5 percent increase in the price of ice cream and a 3 percent decrease in the quantity of ice cream sold. The revenue received by ice cream suppliers will ________ because the demand for ice cream is ________. A. increase; price elastic B. decrease; price elastic C. decrease; price inelastic D. increase; price inelastic
B
The producer surplus from a good is equal to the A. actual price of the good minus the maximum amount a consumer is willing to pay for the good. B. price of the good minus its opportunity cost of production. C. maximum amount a consumer is willing to pay for the good minus the price that actually must be paid. D. opportunity cost of producing the good minus its price.
A
When the price of a movie ticket increases from $5 to $7, the quantity of tickets demanded decreases from 600 to 400 a day. What is the price elasticity of demand for movie tickets? A. 1.20 B. 2.32 C. 1.00 D. 0.83
A
The reduction in consumer and producer surplus that results from underproduction is called A. a deadweight loss. B. an internal cost. C. a quantity loss. D. None of the above answers is correct.
B
The resource allocation method that is used to allocate scarce resources between private use and government use is A) lottery. B) majority rule. C) first-come, first-served. D) personal characteristics.
A
The short run is a period of time in which A. the quantity used of at least one resource is fixed. B. resource prices are fixed. C. output prices are fixed. D. the quantities used of all resource are fixed.
C
The short run is a time period during which A) all factors of production are fixed. B) all factors of production are variable. C) at least one factor of production is fixed. D) a firm can earn a normal profit.
C
The table above gives the demand schedule for snow peas. If the price of snow peas falls from $4.00 to $3.00 a bushel, total revenue will A) increase because demand is elastic in this range. B) increase because demand is inelastic in this range. C) decrease because demand is inelastic in this range. D) decrease because demand is elastic in this range.
A
Total cost is equal to the A. sum of the total fixed cost and the total variable cost. B. sum of the average fixed cost and the average variable cost. C. product of the marginal cost multiplied by the average total cost. D. difference between the average variable cost and the average fixed cost.
A
Total product is A. maximum output that a given quantity of labor can produce. B. the increase in output that results from a oneminus−unit increase in the quantity of labor employed with all other inputs remaining the same. C. maximum amount of output produced by a given quantity of labor divided by the given quantity of labor employed. D. maximum amount of amount of output produced by a given quantity of labor divided by price of the output.
C
Total surplus is defined as A. consumer surplus minus− producer surplus. B. another word for total revenue. C. consumer surplus + producer surplus. D. another word for profit.
B
Using the data in the above table, the average total cost of producing 16 units per day is A) $6.25. B) $7.50. C) $1.25. D) $7.00
A
When allocating resources using market price A. everyone who is willing and able to pay for a good gets one. B. everyone who wants a good gets one. C. everyone who is able to pay for a good gets one. D. everyone who is willing to pay for a good gets one.
C
When scarce resources can serve only one user at a time in sequence, which method works well for allocating the scarce resources? A. command system B. contest C. first come, first served D. lottery
B
When the percentage change in quantity demanded is less than the percentage change in price, the demand for the good is ________. A) elastic B) inelastic C unit elastic D) perfectly inelastic
D
When consumers' incomes increased 10 percent, the quantity of milk bought increased 5 percent. This result means A. the demand for milk is income elastic. B. milk is a luxury. C. milk is an inferior good. D. milk is a necessity.
B
When consumers' incomes increased 6 percent, the quantity of wine bought increased 12 percent. This result means A. wine is an inferior good. B. wine is a luxury. C. the demand for wine is income inelastic. D. wine is a necessity.
A
Which method is used to allocate campus parking space between student areas and faculty areas? A. command B. majority rule C. contest D. market price
D
Which method is used to allocate the host city for the Olympic gamesthe host city for the Olympic games? A. personal characteristics B. command C. lottery D. contest
D
Which of the following factors is fixed in the long run? A. Land B. Capital C. Entrepreneurship D. None of the above because all factors are variable in the long run.
D
Which of the following statements is FALSE? A. The value of one more unit of a good is the good's marginal benefit. B. A good's marginal benefit is the maximum price people are willing to pay for another unit. C. The maximum price people are willing to pay for one more unit of a good is its value. D. None of the above because all the statements are true.
C
Which of the following statements is true? A. If marginal benefit exceeds marginal cost by as much as possible, production is efficient. B. Marginal cost increases as the quantity produced decreases. C. At the efficient quantity, marginal benefit equals marginal cost. D. Marginal benefit decreases as the quantity consumed decreases.
A
Which of the following would be classified as a variable cost for the local Texaco station? A. The total wages paid to the workers who are all paid $6.00 per hour, no matter how many hours they work each week. B. Interest payments to a local bank for a 5minus−year loan. C. The premiums paid for liability insurance, which are constant throughout the life of the contract. D. The opportunity cost of money used to finance the installation of some new pumps.
A
"Diminishing marginal returns" refer to a situation in which the A. marginal product of the last worker hired is less than the marginal product of the previous worker hired. B. average cost of the last worker hired is less than the average cost of the previous worker hired. C. marginal cost of the last worker hired is less than the marginal cost of the previous worker hired. D. average product of the last worker hired is less than the average product of the previous worker hired.
A
Pat's Catering finds that when it caters 20 meals a week, its total cost is $6,000. If Pat has total variable cost of $5,000, what is Pat's total fixed cost? A. $1,000 B. $250 C. $6,000 D. $50