ECON 2030 practice chapter 1

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 her marginal cost of completing the task?

$200

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 her marginal benefit if she sells the quilt "as is" now?

$900

Hours Open: Total Rev: 1. $35 2 $60 3 $80 4 $92 5 $100 6 $105 Eva runs a small bakery in the village of Roggerli. She is debating whether she should extend her hours of operation. Ava figures that her sales revenue will depend on the number of additional hours the bakery is open as shown in the table above. She would have to hire a worker for those hours at a wage of $12 per hour. Using marginal analysis, how many hours should Eva extend her bakery's hours of operation?

4 hours

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 purchase the period fabric, complete the task and then sell the quilt B. It does not matter what she does ; she is going to take a loss on her project 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. She should cut her losses and sell the quilt now

A. she should purchase the period fabric, complete the task and then sell the quilt MC = $200 MB = 1500 - 900 = 600 MB>MC: finish the quilt

which of the following is an example of an economic trade-off that a firm has to make? A. whether or not consumers will buy its products B. Whether it is cheaper to produce with more machines or with more workers C. deciding why consumers want its products D. deciding what profit margin it desires for its products

B. Whether it is cheaper to produce with more machines or with more workers

Economics if the study of the ___ people make to attain their goals, given their ____ resources. A. decisions; households B. choices; scarce C. income; available D. purchases; unlimited

B. choices; scarce

If the marginal cost of producing a television is constant at $200, then a firm should produce this item A. as long as its marginal cost does not rise B. only if the marginal benefit it receives is greater than $200 plus an acceptable profit margin C. As long as the marginal benefit it receives is just equal to or greater than $200 D. until the marginal benefit it receives reaches zero

C. As long as the marginal benefit it receives is just equal to or greater than $200

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

C. unlimited wants exceed limited resources