Macro Chaing Ch.1-4 Exam

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:

$0.61

If a country has few resources:

It will still have a comparative advantage in something

If bagels and doughnuts are substitute goods, then which of the following is likely to occur if the price of bagels is reduced?

The demand curve for donuts will shift to the left

When quantity demanded exceeds quantity supplied,

a shortage occurs and prices are bid up toward equilibrium.

A change from an inefficient mix to an efficient mix of output would best be represented with a production possibilities frontier as a:

movement from inside the PPF onto the PPF

If the demand for iPhones rises as incomes increase, then the iPhone is a(n):

normal good

flu vaccination shots provide external benefits. Thus:

too few flu vaccination shots are given

Suppose the actual price for good A is $20. John is willing to pay $30, Susie is willing to pay $28, Joseph is willing to pay $25, Jessica is willing to pay $23, and Jeremy is willing to pay $21. What is total consumer surplus?

$27

What is the difference between a change in quantity supplied and a change in supply?

A change in the market price affects the quantity supplied, but not the supply

Jason purchased a new printer for $150 although he was willing to pay $175. The minimum price acceptable by the seller, Jasmine, was $145.

A consumer surplus of $25 exists, and producer surplus is $5

Jonathan purchased coffee for $5 at Jennifer's coffee shop; however, he was willing to pay $9. Jennifer was willing to accept $3 for the coffee.

A consumer surplus of $4 exists and a producer surplus of $2 exists

Which of the following goods is not typically considered a public good?

Bottled water

Which is an example of a normative question?

How should a society achieve full employment?

Economists understand that people respond to:

Incentives

When economics use the work "additional," they generally mean:

Marginal

Microeconomics is concerned with issues such as:

Which job to take

Which of the following will not cause an increase in demand?

a decrease in the product's price

The production of too many Matchbook cars and not enough Barbie Dolls is an example of:

allocative inefficiency

All else equal, a decrease in the number of businesses selling pizza will cause:

an increase in the equilibrium price of pizza

Most trade is based on specialization according to:

comparative advantage

Willingness-to-pay is:

highest value that a consumer believes a good or service is worth

Efficiency within economics focuses on:

how well resources are used and allocated

When the supply curve shifts out (to the right) and the demand curve shifts out (to the right), the equilibrium quantity will:

increase

When society produces the mix of goods and services that are most desired and produces them at the lowest cost possible:

production and allocative efficiency are achieved

Every point on the frontier of the production possibilities frontier represents:

productive efficiency

Deadweight loss:

reduces consumer surplus and producer surplus

The supply curve:

shows a positive relationship between price and quantity supplied

Electricity is essential in the production of aluminum. If electricity prices increase:

the supply curve for aluminum shifts leftward

What is the main input in the production of flour. If the price of wheat increases, all else equal, we would expect:

the supply of flour to decrease

The derivation of a production possibilities frontier assumes that:

there is a fixed quantity of resources and technology available