Econ Exam 1

The table shows the demand and supply schedules for running shoes. Price (dollars per pair) Quantity demanded Quantity supplied (pairs of running shoes per week) 60.00 1000 400 70.00 900 500 80.00 800 600 90.00 700 700 100.00 600 800 The equilibrium price of a pair of running shoes is $_____ and the equilibrium quantity is ____ pairs a week.

90.00, 700

A circular flow model shows the interrelationship between the ____ markets and the ____ markets. A. goods; factor B. expenditure; income C. household; factor D. business; household E. household; goods

A. goods; factor

The table gives the demand schedule for peanuts Price (dollars per packet) Quantity demanded (packets per day) 0.20 80 0.40 70 0.60 60 0.80 50 1.00 40 1.20 30 1.40 20 1.60 10 When the price of peanuts falls from $1.40 to $1.00 a packet, what is the change in total revenue?

$12

In Pioneer Ville, the price elasticity of demand for bus rides is 0.5, the income elasticity of demand for bus rides is 0.1, and the cross elasticity of demand for bus rides with respect to gasoline is 0.2. If incomes in Pioneer Ville increase by 5 percent with no change in the price of a bus ride. If incomes in Pioneer Ville increase by 5 percent with no change in the price of a bus ride, the number of bus rides (1) by 0.5 percent.

(1) increases by 0.5

When the price of a cup of coffee increases 10 percent, the quantity of donuts demanded decreases by 4 percent. The cross elasticity of demand for donuts with respect to the price of a cup of coffee is ________.

-0.4

A 6 percent increase in the price of a good increased the quantity supplied of the good by 3 percent after one month. The price elasticity of supply of this good is

0.5

One winter recently, the price of home heating oil increased by 20 percent and the quantity demanded decreased by 2 percent, and with no change in the price of wool swaters, the quantity of wool sweaters increased by 10%. The cross elasticity of demand for wool sweaters with respect to the price of home heating oil is

0.5

In 2003, when music downloading first took off, Universal Music slashed the price of a CD from $21 to $15. The company said that it expected the price cut to boost the quantity of CDs sold by 30 percent, other things remaining the same. Universal Music's estimate of the price elasticity of demand for CDs was ____

0.9

A survey found that when incomes increased by 10 percent, the following changes in quantities demanded occurred: cruises up by 15%, spring water up by 5%, and sports drinks down by 2%. The income elasticity of demand for cruises is 1.5 . The income elasticity of demand for spring water is 0.5 . The income elasticity of demand for sports drinks is − 0.2 . The demand for (1) is income elastic and the demand for (2) is income inelastic. (1) cruises spring water sports drinks (2) cruises spring water sports drinks

1. cruises 2. spring water

A (1) statement is a statement about what is. A (2) statement is about what ought to be.

1. positive 2. Objective

The chairman of Yanzhou Coal Mining, Wang Xin, reported that the demand for coal has fallen and the quantity produced decreased by 11.9 percent from a year earlier, despite the price falling by 10.6 percent. The price elasticity of supply of coal at Yanzhou Coal Mining is

1.12

A survey found that when incomes increased by 10 percent, the following changes in quantities demanded occurred: cruises up by 15%, spring water up by 5%, and sports drinks down by 2%. The income elasticity of demand for cruises is _____ . The income elasticity of demand for spring water is ______ . The income elasticity of demand for sports drinks is ______

1.5 0.5 -0.2

Price (dollars per loaf) Quantity demanded Quantity supplied (loaves per day) 1.45 400 220 1.80 350 260 2.15 300 300 2.50 250 340 2.85 200 380. Excellent weather in wheat growing areas increases the quantity supplied by 90 loaves a day at each price. The new equilibrium price is $_____ a loaf and the new equilibrium quantity is ____ loaves a day.

1.80, 350

Price (dollars per cake) Quantity supplied (cheesecakes per week) Annie Kathleen Elizabeth 10.00 500 0 300 11.00 600 100 350 12.00 700 200 400 13.00 800 300 450 Annie, Kathleen, and Elizabeth are the only sellers of in an isolated village. cheesecakes The table shows the quantity of cheesecakes that they supply at various prices. When the price of a cheesecake is $11 , the quantity of cheesecakes supplied in the market in a week is ________ .

1050

Bonnie and Elle each own an ice cream parlor. In an hour, Bonnie can produce 11 milkshakes or 22 ice cream sundaes and Elle can produce 24 milkshakes or 96 ice cream sundaes. Bonnie's opportunity cost of producing 1 milkshake is _______ ice cream sundaes. Elle's opportunity cost of producing 1 milkshake is ________ ice cream sundaes

2 and 4

Sara's Production Possibilities Boards (per week) Sails (per week) 10 and 0 8 and 4 6 and 8 4 and 12 2 and 16 0 and 20 Fran's Production Possibilities Boards (per week) Sails (per week) 30 and 0 24 and 3 18 and 6 12 and 9 6 and 12 0 and 15. Sara's opportunity cost of producing a board is __________ sails. Fran's opportunity cost of producing a board is _______ sails.

2.0 and 0.5

problem; When Elle's Espresso Bar raised its prices by 10 percent, the quantity of coffee that Elle's sold fell by 40 percent. When Elle's and its competitors cut their prices by 10 percent, the quantity of coffee sold by Elle's increased by only 4 percent. Calculate the price elasticity of demand for Elle's coffee and the price elasticity of demand for coffee. The price elasticity of demand for Elle's Espresso Bar coffee is _______ . The price elasticity of demand for coffee is _______ .

4, 0.4

Possibility Fish Berries (pounds) (pounds) A 0 and 20 B 1 and 18 C 2 and 15 D 3 and 11 E 4 and 6 F 5 and 0 The change from Possibility A to Possibility B in the table involves a tradeoff because the economy gives up ______ to gain ______. A. 2 pounds of berries; 1 pound of fish B. 1 pound of fish; 2 pounds of berries C. 18 pounds of berries; 1 pound of fish D. 20 pounds of berries; 1 pound of fish

A. 2 pounds of berries; 1 pound of fish

7. 8. Which of the following describes the reason why scarcity exists? A. There is too much unemployment. B. Governments make bad economic decisions. C. Wants exceed the resources available to satisfy them. D. The gap between the rich and the poor is too wide. Every week, Bob runs for one hour, and his grade on each psych test is 95 percent. Last week, after running for one hour, Bob considered running for an additional hour. He decided to run for another hour and cut his study time by one hour, but last week his psych grade fell to 80 percent. What was Bob's opportunity cost of the second hour of running? A. A 15 percentage point drop in his psych grade. B. The extra hour of running. C. The 95 percent in psych. D. The 80 percent in psych..

A. A 15 percentage point drop in his psych grade

Which of the following statements describes a change in the quantity supplied and which describes a change in supply? I Farms are selling less chicken because the price of turkey has increased. II Farms are selling less chicken because the price of chicken has fallen. III Farms are selling more chicken because the price of chicken has risen. IV Farms are selling more chicken because the cost of chicken feed has fallen. A. I and IV are changes in supply and II and III are changes in the quantity supplied. B. I, II, and III are changes in supply and IV is a change in the quantity supplied. C. I is a change in the quantity supplied and II, III, and IV are changes in supply. D. I, II, and III are changes in the quantity supplied and IV is a change in supply

A. I and IV are changes in supply and II and III are changes in the quantity supplied.

Which of the following illustrates a tradeoff? A. I will study for my exam instead of going for the movie tonight. B. Tom prefers iPhone while Randy prefers Android. C. New York is an expensive city. D. Randy enjoys ski vacations

A. I will study for my exam instead of going for the movie tonight.

Which of the following items are not factors of production? Explain why not. Item a: Vans used by a baker to deliver bread Item b: 1,000 shares of Amazon.com stock Item c: Undiscovered oil in the Arctic Ocean Item d: A bulldozer Item e: A soda Item f: The Attorney General A. Items b, c, and e because they are not productive resources used to produce goods and services—land, labor, capital, or entrepreneurship. B. Items a, d, and f because they are productive resources used to produce goods and services—land, labor, capital, or entrepreneurship. C. Item e only because it is a consumption good. D. Item b because it is just a piece of paper and item c because it isn't available to produce goods and services. All other items in the list are factors of production. E. Item f because the Attorney General has many assistants.

A. Items b, c, and e because they are not productive resources used to produce goods and services—land, labor, capital, or entrepreneurship.

14. Poor India makes millionaires at fastest pace India, with the world's largest population of poor people, also paradoxically created millionaires at the fastest pace in the world. Millionaires increased by 22.7 percent to 123,000. In contrast, the number of Indians living on less than a dollar a day is 350 million and those living on less than $2 a day is 700 million. In other words, there are 7,000 very poor Indians for every millionaire. Why might incomes of $1 a day and $2 a day underestimate the value of the goods and services that these households actually consume? A. Most households living on $1 or $2 a day produce and consume much of their own food and clothing. B. Prices are lower in India than in the United States. C. A dollar buys more in India than in the United States. D. Prices rise significantly from one year to the next, so although this information may be true in 2008, it cannot be true today. E. $1 a day and $2 a day is an estimate. No household could exist on this income.

A. Most households living on $1 or $2 a day produce and consume much of their own food and clothing.

Which of the following is an example of consumption goods and services? A. Ron bought a Nissan Altima last summer. B. Unemployment in the Eurozone is rising. C. Real estate markets are improving in many US cities. D. Winter has started setting in.

A. Ron bought a Nissan Altima last summer.

The demand for latte is inelastic while the demand for a Starbucks latte is elastic because _______. A. a Starbucks latte has many substitutes such as lattes from other coffee shops, but latte in general has poor substitutes B. a latte at Starbucks is usually more expensive than at other coffee shops C. people spend a greater percentage of their income on Starbucks latte than on latte from other coffee shops D. wealthier people buy their lattes at Starbucks

A. a Starbucks latte has many substitutes such as lattes from other coffee shops, but latte in general has poor substitutes

A tradeoff occurs when we move from ______. A. a point on the PPF to another point on the PPF B. a point outside the PPF to a point inside the PPF C. a point on the PPF to a point outside the PPF D. a point inside the PPF to a point on the PPF E. a point outside the PPF to a point on the PPF

A. a point on the PPF to another point on the PPF

Capital goods _______. A. are goods that businesses and governments buy to increase productive resources to use during future periods to produce other goods and services B. are goods that businesses and governments produce C. include the knowledge and skill that people obtain from education, on-the-job training, and work experience D. include money, stocks, and bonds

A. are goods that businesses and governments buy to increase productive resources to use during future periods to produce other goods and services

The production possibilities frontier is the boundary between the combinations of goods and services that _____, given the available factors of production and the state of technology. A. can be produced and the combinations that cannot be produced B. we want to produce but cannot consume C. can be produced and the prices paid for those D. we want to produce and what we want to consume

A. can be produced and the combinations that cannot be produced

16. El Nino takes toll on U.S. rice farmers Dry weather has delayed rice planting and harvests will be low. But wheat is enjoying a bumper crop. A poor rice harvest will _____ rice and ____ its price. A. decrease the supply of; raise B. decrease the demand for; raise C. decrease the demand for; lower D. decrease the supply of; lower

A. decrease the supply of; raise

Price (dollars per loaf) Quantity demanded Quantity supplied (loaves per day) 1.45 400 220 1.80 350 260 2.15 300 300 2.50 250 340 2.85 200 380. Excellent weather in wheat growing areas increases the quantity supplied by 90 loaves a day at each price. The price of a of _____ and the quantity of demanded _____ as the market moves to its new equilibrium. loaf bread bread A. falls; increases B. rises; does not change C. falls; decreases D. rises; decreases E. rises; increases

A. falls; increases

On Friday May 14, 2009, the following headlines appeared in The Wall Street Journal. Classify each headline as a signal that the news article is about a microeconomic topic or a macroeconomic topic. 1. US Set to Rethink Fed's Role 2. Wal-Mart Makes Electronics Push 3. VW, Porsche Take Break in Talks 4. Economists Foresee Protracted Recovery Macroeconomic topics are dealt with in ______. Microeconomic topics are dealt with in ______. A. headlines 1 and 4; headlines 2 and 3 B. headlines 1 and 2; headlines 3 and 4 C. headlines 2 and 3; headlines 1 and 4 D. headlines 2 and 4; headlines 1 and 3 E. headlines 1 and 3; headlines 2 and 4

A. headlines 1 and 4; headlines 2 and 3

Universal Music's estimate of the price elasticity of demand for CDs was .9 . The demand for CDs was estimated to be _______. A. inelastic B. unit elastic C. elastic

A. inelastic

A 6 percent increase in the price of a good increased the quantity supplied of the good by 3 percent after one month. Supply of this good is ______. The good is most likely produced using factors of production that are _______. A. inelastic; unique or rare B. elastic; unique or rare C. inelastic; plentiful or easily obtained D. elastic; plentiful or easily obtained E. unit elastic; unique or rare

A. inelastic; unique or rare

The equilibrium quantity _______. A. is determined at the price at which the quantity demanded equals the quantity supplied B. is the quantity supplied at the equilibrium price, but not necessarily the quantity demanded C. is any quantity at which the quantity supplied is greater than or equal to the quantity demanded D. is the quantity demanded at the equilibrium price, but not necessarily the quantity sold

A. is determined at the price at which the quantity demanded equals the quantity supplied

The factor of production that earns the highest percentage of total U.S. income is ______. The income this factor of production earns is called ______. A. labor, which is the work time and work effort that people devote to producing goods and services; wages B. labor, which is the knowledge and skill that people obtain from education, on-the-job training, and work experience; wages C. land, which is the natural resources that we use to produce goods and services; rent D. entrepreneurship, which is the human resource that organizes labor, land, and capital to produce goods and services; profit (or loss) E. human capital, which is the knowledge and skill that people obtain from education, on-the-job training, and work experience; interest

A. labor, which is the work time and work effort that people devote to producing goods and services; wages

The 2006 Nobel Peace Prize winner Muhammad Yunus has said that "all people are entrepreneurs" and that microloans will pull poor people out of poverty. Only 14 percent of Americans are entrepreneurs while almost 40 percent of Peruvians are. Most Americans earn their income by selling the services of the factor of production ______. The income they earn is called ______. A. labor; a wage B. labor; profit C. land; rent D. capital; profit E. capital; interest

A. labor; a wage

The productive resources that are used to produce goods and services - _____ are factors of production. A. land, labor, capital, and entrepreneurship B. labor and capital C. land, labor, stocks and bonds D. physical and financial capital

A. land, labor, capital, and entrepreneurship

The price elasticity of demand for Russell's pizza is 1.5. Russell wants to increase his total revenue. Russell should _____ the price of his pizza because the demand for pizza is ______. A. lower; elastic B. lower; unit elastic C. raise; inelastic D. raise; elastic E. lower; inelastic

A. lower; elastic

Financial capital includes _______. A. money, stocks, and bonds, which are not capital because they are not used to produce goods and services B. banks and credit unions, which are capital because they are used to produce financial services C. money, stocks, and bonds, which are capital because they provide businesses with financial resources D. the nation's banking system, which is capital because it is the backbone of the economy

A. money, stocks, and bonds, which are not capital because they are not used to produce goods and services

A decrease in the supply of tank tops brings a _______ of tank tops at the original price, and the price of a tank top will _______. A. shortage; rise B. surplus; fall C. surplus; rise D. shortage; fall

A. shortage; rise

Dry weather has delayed rice planting and harvests will be low. But wheat is enjoying a bumper crop. The markets of wheat and rice influence each other because wheat and rice are______. A. substitutes, so a higher price of rice will increase the demand for wheat B. complements, so a higher price of rice will decrease the demand for wheat C. complements, so a lower price of wheat will increase the demand for rice D. substitutes, so a lower price of wheat will increase the demand for rice

A. substitutes, so a higher price of rice will increase the demand for wheat

One winter recently, the price of home heating oil increased by 20 percent and the quantity demanded decreased by 2 percent, and with no change in the price of wool swaters, the quantity of wool sweaters increased by 10%. Home heating oil and wool sweaters are _____ because_____. A. substitutes; the cross elasticity of wool sweaters with respect to the price of home heating oil is positive. B. complements; the cross elasticity of wool sweaters with respect to the price of home heating oil is positive. C. complements; the cross elasticity of wool sweaters with respect to the price of home heating oil is negative D. substitutes; the cross elasticity of wool sweaters with respect to home heating oil is negative. E. substitutes; the price elasticity of demand for both goods is positive

A. substitutes; the cross elasticity of wool sweaters with respect to the price of home heating oil is positive

A decrease in the demand for chocolate chip cookies brings a ____ of chocolate chip cookies at the original price, and the price of a pack of chocolate chip cookies will ______ A. surplus; fall B. shortage; rise C. surplus; rise D. shortage; fall

A. surplus; fall

The real flows are ______ that flow from firms to households and governments through ______ markets. A. the goods and services; goods B. labor services; financial C. capital goods; goods D. the services of factors of production; factor E. the goods and services; rea

A. the goods and services; goods

You can spend the evening studying or you can go to see a movie. When is the decision to spend the evening studying a rational choice? Your rational choice will be to spend the evening studying if ______. A. the net benefit of spending the evening studying is greater than the net benefit of going to see a movie B. the marginal benefit of spending the evening studying is greater than the marginal cost of spending the evening studying C. there is no tradeoff when you spend the evening studying D. the marginal benefit of going to see a movie is less than the marginal benefit of spending the evening studying

A. the net benefit of spending the evening studying is greater than the net benefit of going to see a movie

. Of the flows that run between households, firms, and governments in the circular flow model, which ones are real flows and which are money flows? The real flows are ______ that flow from households to firms through ______ markets. A. the services of factors of production; factor B. government goods; factor C. the services of factors of production; real D. payments; financial E. consumption goods; financial

A. the services of factors of production; factor

The cruise industry boom is primed to continue Since the recovery from the 2008 recession, the cruise business has been booming, which tells us that Americans look for more adventure and view their vacations as valuable and necessary. Source: Forbes, September 1, 2018 In deciding whether to take a cruise, would you face a tradeoff? You _____ face a tradeoff because _____. A. would; you forgo something else that you might do B. would; taking a cruise is a rational choice C. would not; the marginal benefit of a cruise is always less than its marginal cost D. would not; the marginal cost of a cruise is always less than its marginal benefit

A. would; you forgo something else that you might do

_____ has a comparative advantage in producing _____. A. ; boards because she produces more boards than Fran Sara B. ; boards because her opportunity cost of producing a board is lower than 's opportunity cost of producing a board Fran Sara C. ; sails because her opportunity cost of producing a sail is higher than 's opportunity cost of producing a sail Fran Sara D. Sara; sails because her opportunity cost of producing a sail is less than her opportunity cost of producing a board

B. Fran; boards because her opportunity cost of producing a board is lower than 's opportunity cost of producing a board

Examples of capital include all of the following except _______. A. cruise ships B. Google stock C. Internet servers D. ATMs E. school buses

B. Google stock

Which of the following items are not capital goods? Explain why not. Item a: An auto assembly line Item b: A shopping mall Item c: A golf ball Item d: The Atlantic Ocean Item e: A truck owned by FedEx Item f: A librarian A. Item d only because it can be used by businesses but not bought by businesses. B. Items c, d, and f because they are not items that businesses and governments buy to increase productive resources to use over future periods to produce other goods and services. C. Items a, b,and e because they are items that are bought by businesses to increase their productive resources. D. Item f only because it is a factor of production. E. Items b and c because they provide personal enjoyment

B. Items c, d, and f because they are not items that businesses and governments buy to increase productive resources to use over future periods to produce other goods and services.

Orange Rose Blue Violet Tea pots Coffee pots Tea pots Coffee pots (quantity per week) (quantity per week) 180 and 0 90 and 0 120 and 30 60 and 60 60 and 60 30 and 120 0 and 90 0 and 180 _______ has a comparative advantage in producing and _______ has a comparative advantage in producing . tea pots coffee pots A. Blue Violet; Orange Rose B. Orange Rose; Blue Violet C. Orange Rose; Orange Rose D. Blue Violet; Blue Violet

B. Orange Rose; Blue Violet

Which statement is a positive statement? A. The government should decrease taxes on gasoline. B. The price of oil is falling. C. It is good for the U.S. economy when the price of oil falls. D. America needs more gas stations. E. The United States should be more self-sufficient in oil production

B. The price of oil is falling.

If some retail workers in the United States are re-employed building dams and wind farms, _______. A. the U.S. PPF will shift outward B. a movement along the U.S. PPF will occur C. the U.S. PPF will shift inward

B. a movement along the U.S. PPF will occur

Production efficiency is a situation in which the economy is getting all that it can from its resources and _____ produce more of one good or service without producing _____ of something else. A. cannot; more B. cannot; less C. cannot; equal D. can; less

B. cannot; less

Price (dollars per packet) Quantity demanded (packets per day) 0.20 80 0.40 70 0.60 60 0.80 50 1.00 40 1.20 30 1.40 20 1.60 10 Over the price range of $1.00 to $1.40, the demand for peanuts is ______. A. unit elastic B. elastic C. inelastic

B. elastic

The supply of coal is _______. A. inelastic B. elastic C. unit elastic

B. elastic

How does the event below affect incentives and change the choices that people make? If a hurricane hits Central Florida, the marginal benefit of visiting Disney World will _______, so the incentive to visit Disney World will _______. A. rise; weaken B. fall; weaken C. rise; strengthen D. fall; strengthen

B. fall; weaken

The demand for a good decreases by 10 percent and the supply of the good decreases by 8 percent. The price of the good _______ because _______. A. falls; when demand decreases or supply decreases the price falls B. falls; demand decreases by more than supply decreases and when demand decreases the price falls C. rises; demand decreases by more than supply decreases and when demand decreases the price rises D. either rises or falls; demand decreases and supply decreases E. rises; when demand decreases or supply decreases the price rises

B. falls; demand decreases by more than supply decreases and when demand decreases the price falls

Dry weather has delayed rice planting and harvests will be low. But wheat is enjoying a bumper crop. A bumper wheat crop ____ wheat and ____ its price. A. increases the supply of; raises B. increases the supply of; lowers C. increases the demand for; raises D. increases the demand for; lowers

B. increases the supply of; lowers

One winter recently, the price of home heating oil increased by 20 percent and the quantity demanded decreased by 2 percent. Total revenue ______ because the percentage increase in the price is ______ than the percentage decrease in the quantity demanded. A. does not change; greater B. increases; greater C. increases; less D. decreases; less E. decreases; greater

B. increases; greater

Possibility Fish Berries (pounds) (pounds) A 0 and 20 B 1 and 18 C 2 and 15 D 3 and 11 E 4 and 6 F 5 and 0 Production of 4 pounds of fish and 5 pounds of berries is inefficient because the economy ______. A. can produce more fish but not more berries B. is wasting or not using all its resources C. can produce more berries but not more fish D. is producing on its PPF

B. is wasting or not using all its resources

Economic growth is not free because _______. A. it eliminates production with a free lunch B. it uses resources that cannot be used to produce goods and services for consumption today C. people work during the period of economic growth but many lose their jobs in the future D. it results in the production fewer consumption goods in the future E. it is inefficient

B. it uses resources that cannot be used to produce goods and services for consumption today

The headline "Globalization has reduced African poverty" deals with a _______ topic because it _______. A. microeconomic; discusses a single topic B. macroeconomic; concerns an aggregate outcome in Africa resulting from decisions by individuals, businesses, and governments C. macroeconomic; affects many people D. macroeconomic; deals with a topic of global interest E. microeconomic; discusses a topic of interest within a single continent

B. macroeconomic; concerns an aggregate outcome in Africa resulting from decisions by individuals, businesses, and governments

The demand for gasoline is more inelastic in the short run than in the long run because in the short run _______. A. people spend a greater percentage of their income on gasoline B. people don't quickly change from gas-guzzling cars to fuel-efficient cars when the price of gasoline rises C. gasoline is a necessity D. gasoline is a narrowly defined commodity

B. people don't quickly change from gas-guzzling cars to fuel-efficient cars when the price of gasoline rises

A positive relationship or direct relationship is a relationship between two variables that move in _____ , and a negative relationship or inverse relationship is a relationship between two variables that move in _____. A. a constant direction; random directions B. the same direction; opposite directions C. opposite directions; the same direction D. random directions; a constant direction

B. the same direction; opposite directions

5. Define the factor of production called capital. Give examples of capital. Distinguish between the factor of production capital and financial capital. Capital consists of _______. A. the knowledge and skill that people obtain from education, on-the-job training, and work experience B. tools, instruments, machines, buildings, and other items that have been produced in the past and that businesses now use to produce goods and services C. the creative and imaginative abilities of people who come up with new ideas about what and how to produce D. money, stocks, and bonds E. the gifts of nature

B. tools, instruments, machines, buildings, and other items that have been produced in the past and that businesses now use to produce goods and services

You buy a pizza. What is the opportunity cost of the pizza? The opportunity cost of the pizza is the _______. A. value of all the possible alternatives given up to buy the pizza B. value of the highest-valued alternative given up to buy the pizza C. money spent on the pizza D. the time spent getting the pizza

B. value of the highest-valued alternative given up to buy the pizza

Which of the following is a factor of production? Explain why. A. A movie because it is produced using land, labor, capital, and entrepreneurship B. A garbage truck because it provides a service usually paid for by municipal taxes C. An ATM and a strawberry field because they are used to produce goods and services D. An interstate highway and an airplane because they are used by individuals and governments E. A school teacher and the President of the United States because all people are factors of production

C. An ATM and a strawberry field because they are used to produce goods and services

Aqua Springs makes the following four statements about bottled spring water. Which statement best describes the firm's quantity supplied in the bottled water market? A. We'll switch from plain water to flavored water is flavored is more profitable. B. If we could get a higher price, we'd bottle more water. C. At a price of $1 gallon, we plan to sell 2,000 gallons per day. D. We would sell more water if the demand for it were greater.

C. At a price of $1 gallon, we plan to sell 2,000 gallons per day

In an hour, Bonnie can produce 11 milkshakes or 22 ice cream sundaes and Elle can produce 24 milkshakes or 96 ice cream sundaes. _______ has a comparative advantage in milkshakes and _______ has an absolute advantage in both goods. A. Elle;Elle B. Bonnie;neither C. Bonnie; Elle D. Elle;Bonnie

C. Bonnie; Elle

Claire and Don are farmers who produce beef and corn. In a year, Claire can produce 20 tons of beef or 80 bushels of corn. In a year, Don can produce 40 tons of beef or 80 bushels of corn. To maximize their total output of beef and corn _______. A. Claire and Don each spend half of their time producing beef and the other half producing corn B. Claire produces beef and corn while Don produces nothing C. Don produces beef and Claire produces corn D. Claire produces beef and Don produces corn

C. Don produces beef and Claire produces corn

Consider how incomes are distributed within economies and across the world. Which of the following statements about aspects of global income is correct? A. Between 1976 and 1998, the number of people in the world who earn $1 a day or less increased by 235 million. B. Incomes in China and India are growing slowly relative to that in advanced economies. C. Income inequality across the entire world has decreased during the past 20 years, and extreme poverty has declined. D. Average income per person per day in the United States is ten times the world average.

C. Income inequality across the entire world has decreased during the past 20 years, and extreme poverty has declined

The 2006 Nobel Peace Prize winner Muhammad Yunus has said that "all people are entrepreneurs" and that microloans will pull poor people out of poverty. Only 14 percent of Americans are entrepreneurs while almost 40 percent of Peruvians are. So many people in Peru are entrepreneurs because _____. A. Peruvians prefer to make a profit rather than earn a wage B. most jobs in Peru are given to highly-educated immigrants C. Peru is a poorer country than the United States, so Peru has more limited employment opportunities D. entrepreneurs in Peru earn a higher income than entrepreneurs in the United States E. people in Peru have better entrepreneurial skills than people in the United States

C. Peru is a poorer country than the United States, so Peru has more limited employment opportunities

Consider the market for coffee. Suppose the price of a donut rises. What is the effect of this event on the quantity of coffee demanded and on the demand for coffee? A. The demand for coffee increases. B. The quantity of coffee demanded increases and the demand for coffee also increases. C. The demand for coffee decreases. D. The quantity of coffee demanded decreases. E. The quantity of coffee demanded increases.

C. The demand for coffee decreases

Which of the following is an example of capital goods? A. The population of India will overtake China by 2020. B. I enjoy Starbucks' coffee. C. The government will open another public school in the area. D. Sam is scared of driving

C. The government will open another public school in the area.

Possibility Fish Berries (pounds) (pounds) A 0 and 20 B 1 and 18 C 2 and 15 D 3 and 11 E 4 and 6 F 5 and 0 Can this economy produce 2 pounds of fish and 18 pounds of berries? A. This economy cannot produce 2 pounds of fish and 18 pounds of berries because this combination is inefficient. B. This economy cannot produce 2 pounds of fish and 18 pounds of berries because islanders prefer fish to berries. C. This economy cannot produce 2 pounds of fish and 18 pounds of berries because this combination is outside its PPF. D. This economy can produce 2 pounds of fish and 18 pounds of berries if the weather is warm and sunny

C. This economy cannot produce 2 pounds of fish and 18 pounds of berries because this combination is outside its PPF.

Which of the following statements describes a perfectly inelastic demand? A. I prefer taking the subway to work rather than driving because of high fuel prices. B. The government is promoting generic drugs that are much cheaper. C. Walgreens does not find any change in the number of people buying chlorthalidone after a 7 percent rise in its price. D. A large number of youngsters buy roses from Colombian rose-growers before Valentine's Day.

C. Walgreens does not find any change in the number of people buying chlorthalidone after a 7 percent rise in its price.

Which of the following describes the reason why scarcity exists? A. There is too much unemployment. B. Governments make bad economic decisions. C. Wants exceed the resources available to satisfy them. D. The gap between the rich and the poor is too wide.

C. Wants exceed the resources available to satisfy them.

An example of a consumption good and service is _______. A. a freeway B. a golf course C. a chocolate chip cookie D. an oil tanker

C. a chocolate chip cookie

Consumption goods and services _______. A. include bank accounts owned by individuals and governments B. are items that businesses use to produce other goods and services C. are items that individuals and governments buy and use up in the current period D. are items that governments produce as a means of increasing employment

C. are items that individuals and governments buy and use up in the current period

If Nathan has an absolute advantage in growing tomatoes and lettuce, he will _______. A. be unable to trade with Di B. have a comparative advantage in growing both goods C. have a comparative advantage in one activity but not both D. be a better farmer than Di

C. have a comparative advantage in one activity but not both

In Party Ville, the price elasticity of demand for soda is 0.4, the income elasticity of demand for soda is 0.3, and the cross elasticity of demand for soda with respect to juice is 4. An increase in the price of a can of soda will ______ total revenue. A. decrease B. not change C. increase

C. increase

For consumers, computers and movie downloads are complements. If the price of a computer decreases, the demand for movie downloads will _______. A. not change, but there will be a movement along the demand curve for movie downloads B. decrease, and the demand curve for movie downloads will shift leftward C. increase, and the demand curve for movie downloads will shift rightward D. increase or decrease, but the demand for computers will not change

C. increase, and the demand curve for movie downloads will shift rightward

The points that are attainable are all points _______. A. inside the PPF but not on the PPF or outside the PPF B. inside the PPF, on the PPF, and outside the PPF C. inside the PPF and on the PPF D. on the PPF but not inside or outside the PPF E. on the PPF and outside the PPF

C. inside the PPF and on the PPF

The demand for premium gasoline is likely to be _______ the demand for all grades of gasoline. A. more inelastic than B. equally inelastic as C. less inelastic than

C. less inelastic than

Households are individuals or groups of people _____ together. Firms are institutions that organize _____ of goods and services. A. consuming; imports B. enjoying; exports C. living; the production D. saving; the consumption

C. living; the production

The headline "Motor vehicle production in China is growing by 10 percent a year" deals with a _______ topic because _______. A. microeconomic; it deals with only one topic B. microeconomic; almost everyone in China buys a car C. microeconomic; it is the outcome of choices made by individuals and businesses D. macroeconomic; the market for cars is global E. macroeconomic; production of cars is a large contributor to the world economy

C. microeconomic; it is the outcome of choices made by individuals and businesses

"Imports from China are swamping U.S. department stores" is a _______ statement. "The rural population in the United States is declining" is a _______ statement. A. normative; normative B. positive; positive C. normative; positive D. positive; normative

C. normative; positive

An example of a capital good is a _______.

C. shopping mall

If a drought devastates California's economy, _______. A. a movement along the U.S. PPF will occur B. the U.S. PPF will shift outward C. the U.S. PPF will shift inward

C. the U.S. PPF will shift inward

If more Americans take early retirement, _______. A. the U.S. PPF will shift outward B. a movement along the U.S. PPF will occur C. the U.S. PPF will shift inward

C. the U.S. PPF will shift inward

Demand is _____, when all other influences on buying plans remain the same. A. the quantity of a good that people plan to buy B. the is the quantity of a good that people want but can't afford C. the relationship between the quantity demanded of a good and the price of the good D. the relationship between the quantity demanded of a good and income

C. the relationship between the quantity demanded of a good and the price of the good

Supply is _____, when all other influences on buying plans remain the same. A. the relationship between the quantity supplied of a good and the cost of labor used to produce it B. the is the quantity of a good that producers would be willing to sell if costs were lower C. the relationship between the quantity supplied of a good and the price of the good D. the quantity of a good that producers plan to sell

C. the relationship between the quantity supplied of a good and the price of the good

Carbon dioxide emissions from cars must be cut from 130 grams to 95 grams per kilometer. To meet this new standard, the price of a car will rise by $1,350. Source: International Business Times, November 9, 2015 Calculate the opportunity cost of reducing the carbon emission level by 1 gram. The opportunity cost of reducing the emission level by 1 gram is ______. A. $38.57 of other goods and services and 35 grams B. $14.21 of other goods and services C. $1,350 of other goods and services D. $38.57 of other goods and services E. 35 grams

D. $38.57 of other goods and services

When the price of a good rises from $5 to $7 a unit, the quantity supplied increases from 110 to 130 units a day. The price elasticity of supply is _______. The supply of the good is _______. A. 10; elastic B. 2; inelastic C. 60; elastic D. 0.5; inelastic

D. 0.5; inelastic

When Elle's Espresso Bar raised its prices by 10 percent, the quantity of coffee that Elle's sold fell by 40 percent. When Elle's and its competitors cut their prices by 10 percent, the quantity of coffee sold by Elle's increased by only 4 percent. Explain the difference between the responses to Elle's price hike and the price cut. Why did the price increase bring a large response in the quantity sold while the price cut had only a small effect? A. Elle's coffee has lots of close substitutes while coffee has few substitutes, so the demand for Elle's coffee is more inelastic than the market demand for coffee. B. The change in the quantity demanded is always larger with a price hike than with a price cut. C. With a price hike the demand for Elle's coffee is inelastic, but with a price cut the demand for Elle's coffee is elastic. D. Elle's coffee has lots of close substitutes while coffee has few substitutes, so the demand for Elle's coffee is more elastic than the market demand for coffee.

D. Elle's coffee has lots of close substitutes while coffee has few substitutes, so the demand for Elle's coffee is more elastic than the market demand for coffee.

Which of the following statements about the market for chicken describes a change in the quantity demanded and which describes a change in demand? I People are buying less chicken because the price of beef has fallen. II People are buying less chicken because the price of chicken has increased. III People are buying more chicken because the price of chicken has fallen. IV The cost of chicken feed has increased. A. I is a change in the quantity demanded and II and III are changes in demand. B. I, II, and III are changes in the quantity demanded and IV is a change in demand. C. I, II, and III are changes in demand and IV is a change in the quantity demanded. D. I is a change in demand and II and III are changes in the quantity demanded.

D. I is a change in demand and II and III are changes in the quantity demanded

Which of the following statements is about a normal good, which is about an inferior good, which is about both, and which is about neither? I With incomes falling in the recession, people are buying more chicken. II People are buying more beef now that incomes have increased. III People are buying more chicken because the price of chicken has fallen. IV With higher incomes people are switching from chicken to beef. A. II is inferior, I is normal, III is neither, and IV is both B. IV is inferior, III is normal, II is neither, and I is both C. III is inferior, II is normal, IV is neither, and I is both D. I is inferior, II is normal, III is neither, and IV is both

D. I is inferior, II is normal, III is neither, and IV is both

Nathan and Di are the only people in an isolated village who grow tomatoes and lettuce. Nathan has a comparative advantage in growing tomatoes if _______. A. Nathan's opportunity cost of producing tomatoes is less than his opportunity cost of producing lettuce B. Nathan's marginal benefit from tomatoes is greater than Di's C. Nathan has an absolute advantage in growing both tomatoes and lettuce D. Nathan's opportunity cost of producing tomatoes is less than Di's opportunity cost of producing tomatoes

D. Nathan's opportunity cost of producing tomatoes is less than Di's opportunity cost of producing tomatoes

Which of the following statements about U.S. production is correct? A. Real estate services account for 14.5 percent of the value of total production, larger than any other item of services or goods. B. The manufacture of goods represents more than 50 percent of total production. C. Construction accounts for a larger percentage of total production than does manufacturing. D. Services represent 78.2 percent of U.S. production by value and that percentage doesn't fluctuate much from year to year

D. Services represent 78.2 percent of U.S. production by value and that percentage doesn't fluctuate much from year to year.

Explain which of the following items are components of the opportunity cost of being a full-time college student who lives at home. The things that the student would have bought with • A higher income • Expenditure on tuition • A subscription to the Rolling Stone magazine • The income the student will earn after graduating The things the student would have bought with _______ are all components of the opportunity cost of being a full-time college student who lives at home. A. a higher income and the income the student will earn after graduating B. expenditure on tuition and the income the student will earn after graduating C. a higher income now and after graduation, expenditure on tuition and a subscription to the Rolling Stone magazine if it was required by a class D. a higher income, expenditure on tuition, and a subscription to the Rolling Stone magazine if it was required by a class

D. a higher income, expenditure on tuition, and a subscription to the Rolling Stone magazine if it was required by a class

In Pioneer Ville, the price elasticity of demand for bus rides is 0.5, the income elasticity of demand for bus rides is 0.1, and the cross elasticity of demand for bus rides with respect to gasoline is 0.2. If incomes in Pioneer Ville increase by 5 percent with no change in the price of a bus ride. In Pioneer Ville, a bus ride is ______ good. In Pioneer Ville, bus rides and gasoline are ______. A. an inferior; complements B. an inferior; substitutes C. a normal; complements D. a normal; substitutes

D. a normal; substitutes

A market is an arrangement that brings _____ together and enables them to get information and do business with each other. A. central banks and commercial banks B. governments and producers C. sellers and entrepreneurs D. buyers and sellers

D. buyers and sellers

The demand for _______ is likely to be more inelastic than _______. A. coffee; latte because a latte is more expensive than a coffee B. latte; coffee because coffee has some substitutes whereas latte has only poor substitutes C. latte; latte because a latte is just one of many types of coffee drinks D. coffee; latte because a latte has more substitutes than coffee

D. coffee; latte because a latte has more substitutes than coffee

When the price of a cup of coffee increases 10 percent, the quantity of donuts demanded decreases by 4 percent. The cross elasticity of demand for donuts with respect to the price of a cup of coffee is − 0.4 . We can use the cross elasticity of demand to determine that coffee and donuts are _______. A. substitutes B. normal goods C. inferior goods D. complements

D. complements

Are carbon prices working? Economists say that raising the cost of burning coal, oil, and gas is a cost-effective way to lower carbon emissions, but most countries that have tried this solution have not set prices high enough to bring large enough cuts. Does lowering carbon emissions have an opportunity cost? Lowering carbon emissions _______ because _______. A. does not have an opportunity cost; government initiatives are free B. does not have an opportunity cost; lowering carbon emissions is a rational choice and rational choices do not have an opportunity cost C. has an opportunity cost; the marginal benefit of lowering carbon emissions is much greater than its marginal cost D. has an opportunity cost; the resources used to lower carbon emissions could be used for something else E. does not have an opportunity cost; lowering carbon emissions is a government response to an incentive

D. has an opportunity cost; the resources used to lower carbon emissions could be used for something else

When a firm decides to use robots to produce its output, what question is the firm answering? When a firm decides to produce athletic wear rather than business suits, what question is the firm answering? When we find out who gets the goods and services that are produced, what question is being answered? When a firm decides to use robots to produce its output, it is answering the ______ question. When a firm decides to produce athletic wear rather than business suits, it is answering the ______ question. Who gets the goods and services that are produced answers the ______ question. A. intensity; goods; wealth B. factor of production; why; income C. when; production; inequality D. how; what; for whom

D. how; what; for whom

When the price of a good increased by 2 percent, the quantity demanded of it decreased 10 percent. Most likely, this good ______ and ______. A. has good substitutes; is a necessity B. is a necessity; is broadly defined C. is narrowly defined; is a necessity D. is a luxury; has good substitutes E. is a luxury; has poor substitutes

D. is a luxury; has good substitutes

What is the benefit you receive from a one-unit increase in an activity? What you get from a one-unit increase in an activity that you enjoy is called _______. A. total benefit B. a marginal activity C. making a decision at the margin D. marginal benefit

D. marginal benefit

A substitute in production is a good that is _____ another good, and a complement in production is a good that is _____ another good. A. produced in place of; consumed with B. consumed in place of; produced together with C. produced together with; produced in place of D. produced in place of; produced together with

D. produced in place of; produced together with

The table shows the demand and supply schedules for running shoes. Price (dollars per pair) Quantity demanded Quantity supplied (pairs of running shoes per week) 60.00 1000 400 70.00 900 500 80.00 800 600 90.00 700 700 100.00 600 800 Now a fall in the price of gym membership increases the quantity of pairs demanded by 200 a week at each price. At the original equilibrium price, a _____ occurs. To move to the new market equilibrium,_____. A. shortage of running shows; the price returns to $90 B. surplus of running shows; the price moves to $100 C. surplus of running shows; the quantity demanded increases and the quantity supplied decreases D. shortage of running shows; the quantity demanded decreases and the quantity supplied increases

D. shortage of running shows; the quantity demanded decreases and the quantity supplied increases

The table shows the demand and supply schedules for running shoes. Price (dollars per pair) Quantity demanded Quantity supplied (pairs of running shoes per week) 60.00 1000 400 70.00 900 500 80.00 800 600 90.00 700 700 100.00 600 800 If the price of a pair of running shows is $100 there is a ____ of running shows. As the market moves to equilibrium _____ A. shortage; the quantity demanded decreases and the quantity supplied increases B. surplus; the price rises C. shortage; the price falls D. surplus; the quantity demanded increases and the quantity supplied decreases

D. surplus; the quantity demanded increases and the quantity supplied decreases

Economic growth is defined as the _____ . A. increase in wage rates B. overtaking of the United States by China C. recovery from recession D. sustained expansion of production possibilities

D. sustained expansion of production possibilities

When And if To for the extra hour, you give up . you spend two hours reading, you can read 50 pages you spend three hours reading, you can read 70 pages read working out at the gym for that hour The marginal benefit of reading one more hour is _______. The marginal benefit of reading is measured by _______. A. the 70 pages you read; the time at the gym you must give up B. the extra 20 pages you read; the total time you spent reading C. the extra 20 pages you read; the time at the gym you must give up D. the extra 20 pages you read; the time at the gym you are willing to give up

D. the extra 20 pages you read; the time at the gym you are willing to give up

One winter recently, the price of home heating oil increased by 20 percent and the quantity demanded decreased by 2 percent. Because total revenue and the price change in _________, the demand for home heating oil is ______. A. opposite directions; elastic B. the same direction; unit elastic C. the same direction; elastic D. the same direction; inelastic E. opposite directions; inelastic

D. the same direction; inelastic

Soybean (bushels per year) Chicken (pounds per year) 500 and 0 400 and 300 200 and 500 0 and 600 The table shows a farm's production possibilities. If the farm uses its resources efficiently, what is the farm's opportunity cost of increasing its production of chicken from 300 pounds to 500 pounds a year? The farm incurs an opportunity cost of _______. A. 1 bushel of soybeans a year B. 400 bushels of soybeans a year C. 200 pounds of chicken a year D. 300 pounds of chicken a year E. 200 bushels of soybeans a year

E. 200 bushels of soybeans a year

When the price of a good increased by 3 percent, the quantity demanded of it decreased 12 percent. The price elasticity of demand is ______. A price rise will ______ total revenue. A. 0.25; increase B. 0.25; decrease C. 1.00; increase D. 4.00; increase E. 4.00; decrease

E. 4.00; decrease

Which of the following items are not consumption goods and services? Explain why not. Item a: A chocolate bar Item b: A ski lift Item c: A golf ball Item d: A shopping mall Item e: A train Item f: A golf course A. Items a, b, and c only because they all provide personal enjoyment. B. Items b and e only because they are items bought by businesses. C. Items d, e, and f only because they are items not bought by individuals or governments to use up in the current period. D. Items a and c only because they are items bought by individuals and used to provide personal enjoyment. E. Items b, d, e, and f because they are not items that individuals and governments buy and use up in the current period.

E. Items b, d, e, and f because they are not items that individuals and governments buy and use up in the current period.

Which statement is a normative statement? A. Each state is represented by two senators. B. The Republicans have more seats in Congress than the Democrats. C. Abraham Lincoln was a Republican. D. The President is a Democrat.

E. Life is better in the United States when the House and the President are from the same political party.

A survey found that when incomes increased by 10 percent, the following changes in quantities demanded occurred: cruises up by 15%, spring water up by 5%, and sports drinks down by 2%. The income elasticity of demand for cruises is 1.5 . The income elasticity of demand for spring water is 0.5 . The income elasticity of demand for sports drinks is − 0.2 . Choose the correct statement. A. a membership in an athletic club is an inferior good, spring water is an inferior good, and a sports drink is an inferior good. B. a membership in an athletic club is an inferior good, spring water is an inferior good, and a sports drink is an normal good. C. a membership in an athletic club is an normal good, spring water is an inferior good, and a sports drink is an inferior good. D. a membership in an athletic club is an normal good, spring water is an normal good, and a sports drink is an normal good. E. a membership in an athletic club is an normal good, spring water is an normal good, and a sports drink is an inferior good.

E. a membership in an athletic club is an normal good, spring water is an normal good, and a sports drink is an inferior good.

An economy grows when it _______. A. increases consumption B. moves from a point inside the PPF to a point on the PPF C. moves along its PPF D. lowers prices E. expands its production possibilities

E. expands its production possibilities

The money flows are ______. A. exports and imports B. factors of production, consumption goods and services, lottery winnings, and prizes C. factor incomes, taxes, transfers, and lottery winnings, and prizes D. goods and services, government sales of Treasury bonds, and raw materials E. factor incomes, household and government expenditures on goods and services, taxes, and transfers

E. factor incomes, household and government expenditures on goods and services, taxes, and transfers

Mildred and Robert are the only buyers in the market for DVDs. Mildred buys 8 DVDs when the price of a DVD is $10.00, 6 DVDs when the price of a DVD is $11.00, and 5 DVDs a month when the price of a DVD is $15.00. Robert buys 16 DVDs a month when the price of a DVD is $10.00, 8 DVDs when the price of a DVD is $11.00, and zero DVDs when the price of a DVD is $15.00. In the market for DVDs, the quantity demanded _______. A. at $10.00 a DVD is less than the quantity demanded at $11.00 a DVD B. at $11.00 a DVD is 6 DVDs a month C. increases as the price rises D. at $11.00 a DVD is 8 DVDs a month E. increases as the price falls

E. increases as the price falls

Wheat farmers who had been struggling with a long drought now face a new battle. A South American weed called serrated tussock was spreading at a rapid rate across the bare earth of these drought-stricken wheat farms. And a major problem is that many wheat farmers cannot distinguish serrated tussock from a less harmful native tussock and are unaware of the large effect that serrated tussock can have on productivity and growing capacity. Australia is a major exporter of wheat. If productivity on Australian wheat farms decreases, what happens to the opportunity cost of producing wheat in Australia and to the quantity of wheat that Australia exports? If productivity on Australian wheat farms does decrease, the fall in productivity _______ the opportunity cost of producing wheat in Australia. The quantity of wheat Australia exports _______. A. increases; increases B. increases; does not change C. decreases; decreases D. decreases; increases E. increases; decreases

E. increases; decreases

In Party Ville, the price elasticity of demand for soda is 0.4, the income elasticity of demand for soda is 0.3, and the cross elasticity of demand for soda with respect to juice is 4. The demand for soda is ______ with respect to the price of a can of soda because the ______ elasticity of demand is less than 1. A. inelastic; income B. elastic; income C. inelastic; cross D. elastic; price E. inelastic; price

E. inelastic; price

Consider the incomes paid to the factors of production. Wages are paid for ____ and interest is paid for ____. A. the services of entrepreneurs; the use of land B. labor services; the services of entrepreneurs C. labor services; the use of land D. the services of entrepreneurs; the use of capital E. labor services; the use of capital

E. labor services; the use of capital

Economics studies choices that arise from one fact. What is that fact? A. Global warming is spoiling our air and water. B. Some things can't be bought in the marketplace. C. Our resources exceed our wants. D. Wants exceed the resources available to satisfy them.

Wants exceed the resources available to satisfy them.

In May 2011, businesses cut hiring because the higher price of gas pushed up costs and higher food prices forced consumers to cut spending. Did businesses and consumers act in their self-interest or the social interest? According to the news clip, businesses acted _______ and consumers acted _______. A. in the social interest; in the social interest B. in the social interest; in their own self-interest C. in their own self-interest; in the social interest D. in their own self-interest; in their own self-interest

in their own self-interest; in their own self-interest