econ 120 exam 1 heather luea

Suppose that a store sells candy bars for $0.89 for one, and $1.50 for two. The marginal cost of the second candy bar is:

$.61

If you were not studying economics, you could be doing one of the following: sleeping in (which you value at $5), playing cards with your friends (which you value at $10), or working (you would have earned an extra $8). The opportunity cost of studying economics is therefore:

$10

Which is an example of a normative question?

How should a society achieve full employment?

Government intervention in the market is helpful when:

consumers are forced to buy from just one firm

Rational behavior requires "thinking at the margin." Which of the following is an example of this type of thinking?

deciding whether to pay a fine for polluting the local harbor or installing antipollution machinery deciding whether a second burger is worth the extra $2 All of these are examples of "thinking at the margin." deciding whether your overtime pay is worth working on Saturday (your day off)

Paying a salesperson more for increased sales is an example of

incentive

What would be a possible opportunity cost of you going to a doctor for a check-up?

lost income due to not being at work for those hours

Discounted matinee movie ticket prices demonstrate that:

people follow incentives

A nation's standard of living is primarily a function of:

productivity

Microeconomics is concerned with issues such as:

which job to take