Econ 2110 Exam 1

bob's OC of making a desk is 20$. bill values the desk at 50$. bob sells the desk to bill for 34$. what is the value of bill's CS

16$

only a very small portion of people who use microwaves know how they work. this is an example of:

division of knowledge

if you buy a motorcycle for 1000$ and then discover that you hate riding it and will never ride it again, the best thing to do is

sell the motorcycle for the best offer you can get

if iyou are searching for a new pair of skis, it makes sense to keep looking as long as

the shopping time matters less to you than the lower price you expect to get

if you've purchased an all you can eat ticket to a pig roast for 25$ good economic thinking would tell you to take one last plateful

the value of that plateful to you is greater than zero

sunk costs are irrelevant to economic decisions because

they cannot be affected by the decision in question

in economics, the cost of something

what you must give up to get it

the cost of attending the last class before the exam includes:

whatever you miss doing because you go to that class

your company is engaged in two projects, one of which has 25$ million to date, the other of which has cost 10million to date. it can only afford to finish one of the projects the expected benefit from each project is the same. which project should it finish?

whichever can be completed at the least additional cost

the idea that people respond to incentives would lead us to conclude that the murder rate

would fall if tougher penalties are enacted

could you ever have too much environmental protection

yes, if the marginal costs are greater than the marginal benefits

if you decide to go to a movie this evening rather than study, you thereby demonstrate that

at the margin, you value 2 hours of movie more than 2 hours of studying

if you've bought an 80$ sticker to park on campus for the semester to park on campus for the semester and you plan to park on campus eighty times before the semester ends, the marginal cost to you each time you park

0$

senior citizens deserve an income that will allow them to live in comfort for their remaining years. this is an example

a normative statement

a person has a comparative advantage in an activity whenever she

can perform the activity at a lower opportunity cost than the other people

how can I raise the price of coming to class

charge an admission fee, schedule class at inconvenient times, give extra hw to those who show up

which are examples of scarce good

coca cola, insulin, diamonds

smith accidentally runs his car off the road into deep snow. jones happens along in a tow truck and offers to haul smith out for the outrageous price of 300$. smith though angered by high price, pays 300$. smiths welfare was __________ and jone's was ___________ as a result of jones passing by

enhanced, enhanced

suppose a law requires employers to provide health insurance coverage for contract employees, because contract employees deserve health insurance too! what would our economic modle lead us to believe?

firms would use fewer contract employees and they would reduce the amount they pay them. all current contract employees would be made better off

steve is walking along 5th avenue passing by a penny, nickel, dime, and quarter along the way. he only bothers to pick up the quarter. we can infer that the OC to steve of picking up a coin is measured in monetary units is

greater than ten cents but less than 25

if you pay $25,000 for your car just a short while ago, but the best offer you can get for it now is $12,000. you should only sell the car

if its worth to you is less than 12000$

an article in the newspaper suggests that an Indian tribe should use coal rather than gas power because the tribe owns 114 billion tons of coal reserves. this statement

is false because it ignores OC

the cost to a ski instructor of taking a day oof

is higher on the weekend when more people ski

we know that trade makes people better off because

it is voluntary activity, people wouldn't trade otherwise, it only occurs when there is a potential for gains

questions 12-14 , 36 GRAPHS

look em up on da test

the costs that influence decisions are always

marginal cost

if switzerland can make 35 pounds of chocolate or 5 watches while albania can make 6 pounds of chocolate or 1 watch

none of the above

a trade that can make both countries better off would be

one watch for 6.5 pounds of chocolate

i am considering joining a shopper's club where I pay 100$ membership fee and then get a 25% discount on all my purchases. in making my decision I should

only join if I expect to get at least 100$ worth of discount

marginal benefit is the benefit

that arises from a small increase in an activity

which of the following is NOT true regarding the PPF

the PPF shows us that gains from trade are maximized when countries produce goods for which they have an absolute advantage in production

which of the following costs will u consider when deciding whether it is effieceint to take a hike one afternoon

the gas it takes, the studying you won't do, the wear and tear of boots

after graduating from high school, steve had 3 choices, listed in order of preference: 1) matriculate at clemson 2) work in a printed circuit board factory 3) attend a rival college. his opportunity cost of going to clemson includes

the income he could have earned at the printed circuit board factory, the direct cost of attended clemson (tuition, textbooks etc)

if it costs a theater 180,000$ to put on four shows and the cost would rise to 200,000$ if the theater adds a fifth show what is the marginal cost the fifth show

the marginal cost of the fifth show is 20,000$