Microeconomics
Instead of studying for an additional two hours for the economics final, Leann decides to watch a movie. Leann is making -a rational decision if her marginal benefit from the movie is greater than her marginal cost -a decision that does not involve an opportunity cost -an irrational decision because studying is more important than watching a movie
-a rational decision if her marginal benefit from the movie is greater than her marginal cost
If the marginal benefit of getting a college degree rises. rational people will -attend college in greater numbers -drop out of college -require that college gets easier -not change their behavior
-attend college in greater number
Which of the following is a positive statement? -parking tickets on campus impose an excessive fee -a recession leads to higher enrollments at universities university bookstore prices are too high
a recession leads to high enrollments at universities
Your economics professor offers 10 points extra credit if you attend a review session before your next exam.. This extra credit is an example of -an incentive to attend the review session -a rational choice -an increase in the marginal cost to attend the review session
an incentive to attend the review session
Microeconomics includes the study of the -reasons why the government changes interest rates -choices made by individuals and businesses -recessions and inflation in the global economy
choices made by the individuals and businesses.
The benefit of one - unit increase in an activity. -is always greater than the opportunity cost of the activity -is called marginal cost -decreases as you do more of it -is called "sunk benefit:
decreases as you do more of it
A normative statement -says what is currently believed about the way the world operates -can be tested to determine if it is correct -depends on someones values
depends on someones values
Economics is the social science that studies -how people make choices to cope with scarcity -the real reasons people buy goods and services -the psychology of individuals and businesses
how people make choices to cope with scarcity
A professor changes the penalty for cheating on exams from getting a 0 on the exam to getting an F in course. The professor has -increased the marginal cost the cheating -recognized that students don't respond to incentives -decreased the marginal benefit of cheating -recognized that students don't make rational choices
increased the marginal cost of cheating
The marginal cost of an activity ____________ as you do more of it. -changes only if the marginal benefit of the activity changes -changes only if the marginal benefit of the activity does not change -decreases -increases
increases
In order to determine whether to major in economics, a rational individual compares the ________ of the decision. -positive benefits and normative costs -marginal benefit and marginal cost -self - interest and social - interest
marginal benefit and marginal cost
The cost of a one - unit increase in an activity is called the -opportunity benefit -marginal cost -sunk cot -marginal benefit -margin
marginal cost
Whenever one variable increases, another variable decreases. The two variable are -positively related -negatively related -unrelated to other other
negatively related
The Latin term "ceteris paribus" means -obviously true -other things remaining the same -after this, therefore because of this -what is true of the whole is not necessarily true of the parts
other things remaining the same
If jessie studies economics for two hours instead of going to the movies with her friends, then -Jessie is ignoring a sunk cost -Jessie is not responding to any incentives -the opportunity cost of studying in the missed movie
the opportunity cost of studying is the missed movie