Microecomincs Exam 1 Re
Which of the following is not true about economic models?
They are not useful, since they do not include all variables.
how would the equilibrium price in a market be affected if there were a large decrease in demand a small decrease in supply?
the quilibrium price decreases
The concept of opportunity cost is a measure of _________.
the value of the best alternative use of a resource
which of the following is more susceptible to the free0ruder problem: state parks or public roads
use of public roads is more susceptible since even those who don't pay teaxes still benefit, while state parks can charge for admission, so that everyone who goes pays thier share
Which of the following is not an example of causation?
washing your car will lead to raining that dat
You say that positive questions ask ___ and normative questions ask ___
what is or what will be what ought to be
How does microeconomics differ from macroeconomics?
Microeconomics is the study of how individuals, households, firms, and governments make choices, while macroeconomics is the study of the economy as a whole.
The concept of diminishing marginal benefits means that __________.
each additional unit consumed is worth less to you than the previous one.
Which of the following would not be considered a market by an economist?
ALL OF HE ABOVE
Suppose the university is trying to determine the most efficient way to allocate the rooms such that those who value the rooms the most get them. Which of the following would you suggest as the most efficient?
Auctioning the rooms to the highest bidders
Which of the following do you provide as a positive question?
How much is the national debt?
Which of the following is true regarding the concept of causation?
It describes how one event can bring about change in another
Which of the following is not an important property of an economic model?
It predicts actual results over half the time
Economics, anthropology, psychology, sociology, and political science all study human behavior. Economics differs from these other social sciences because it also addresses these three key concepts: _________.
Optimization, equilibrium, and empiricism. Your answer is correct.
Which of the following examples do you provide as a normative question?
Should welfare be repealed?
What does it mean to say that we are running out of "cheap oil"?
That oil reserves are becoming more expensive to find and extract over time
Give an example of a pair of variables that have negative correlation.
The number of winter coats sold and the temperature outside
What does this imply for the price of oil in the future?
The supply of oil will decrease, which will lead to higher prices in the future.
Suppose you have a flashlight that takes three batteries to power it. If you buy the batteries one at a time, for which purchase will diminishing benefits set in?
When you buy the fourth battery
Does the principle of optimization imply that people always make the best choices?
Yes, it is a good approximation for the decisions people make
What is meant by comparative statics? Explain with an example.
a change in an outocome, such as saving, that results from a change ina factor, suhc as the interest rate.
which of the following would not be considered one of the possible opportunity costs of a recent high school graduate starting their career right away by getting a full-time job
all of these is a possible opportunity costs
since there are only limited number of apartments near the city center, theses apartments will be allocated based on ____ that you face. This process is known as___
both the costs and the beneftis optimization
Which of the following is not an item studied under macroeconomics macroeconomics?
cigarete taxes
the concept of diminishing marginal benefits ___ for goods that you like a lot
holds true
free riding occurs when ___ are out of sync with ___
people private benefits the public interest
Suppose a new off-campus university apartment complex could rent its rooms on the open market for $900 a month. If, instead, the university chooses to cap the price of rooms to $500 a month for students, the result would be that ____________.
quantity demanded would exceed the quantity supplied, resulting in a shortage
How would the equilibrium price in a market to be affected if there were a large increase in demand and a small increase in supply?
the equilibrium price increaes
How would an increase in demand affect the equilibrium price in a market?
the equilibrium price increases
Suppose you decide to take an economics course instead of taking a course in Japanese history or Russian poetry. Which of the following are benefits of taking the economics course? (Check all that apply.)
you can apply economic concepts, such as cost-benefit analysis, to help you make better decisions you can use economics analysis to help you better analyze other people's behvaior you will learn to make better choices in your daily life
given this information, for which of these activities would you be able to compare opportunity costs?
you can compare all activities after you translate all the missed activites into dollar amounts
