Econ 202 Final
prisoners dillemma
individuals make selfish decisions that creates a negative outcome for the individuals as a group.
How to find cross price elasticity of two goods?
% change in Qd of good A ------------------------------ % change in P of good B
pecuniary externality
A pecuniary externality occurs when the actions of an economic agent cause an increase or decrease in market prices
When the price of margarine is $2 per pound, 10 pounds of butter are demanded. When the price of margarine increases to $6 per pound, 30 pounds of butter are demanded. What is thecross-price elasticity between the two goods? A) −1 B) 1 C) 2 D) 5
B) 1
What is the marginal product of the second input if the first value is 10 and the second value is 40? A) 80 units B) 40 units C) 10 units D) 30 units
D) 30 units
What does elasticity mean?
a change in price quickly results in a change in the quantity demanded
To find optimal quantity when presented a graph...
MR=MC
Which figure above shows the effect of a technological advance in the production of pizza? a. demand shifts right b. demand shifts left c. Supply shifts left d. Supply shifts right
d. Supply shifts right
P - ATC =
Profit per unit
variable costs + Fixed costs =
Total costs
Scenario: Yasmin and Zeek are lawyers working at V, W, and X LLP. Yasmin works48 hours a week, and Zeek also works 48 hours a week. They handle two types of cases, intellectual property (IP) cases and corporate fraud (CF) cases. It takesYasmin 6 hours to handle each IP case and 4 hours to handle each CF case. Zeek can finish an IP case in 3 hours and a CF case in 6 hours.Refer to the scenario above. What is Zeek's opportunity cost of handling a CF case? a. 2 IP cases b. 1.5 IP cases c. 30 min d. 5 hours
a. 2 IP cases
Electricity generated from coal-burning plants is relatively cheap, but the plants contribute to global warming due to their high level CO2 emissions. The negotiations between developed and developing countries to cut back on coal electricity have failed in the past. This is an example of the ________ a. Tragedy of the commons b. free rider problem c. paradox of thrift d. prisoners' dilemma
a. Tragedy of the commons
Renault, which is a French automobile producer, has a big production plant in theTurkish city of Bursa. A car that is produced in this plant and sold in Boise is an export of ______ a. Turkey b. US c. France d. Boise
a. Turkey
A construction boom occurs and many of the new buildings need plywood for their framing. Which of the figures above best illustrates this change? a. demand shifts right b. demand shifts left c. Supply shifts left d. Supply shifts right
a. demand shifts right
Contractors can use plywood or brick to construct walls. Suppose the price of bricks increases. Which of the figures above best illustrates the effect of this change on the market for plywood? a. demand shifts right b. demand shifts left c. Supply shifts left d. Supply shifts right
a. demand shifts right
Which figure above shows the effect if research is published claiming that eating pizza is healthy? a. demand shifts right b. demand shifts left c. Supply shifts left d. Supply shifts right
a. demand shifts right
The paradox of thrift is...
an economic theory that argues that personal savings can be detrimental to overall economic growth.
Total profit area
area above ATC & below the demand curve
When ATC is higher than the demand curve... a. Profit b. Loss
b. Loss
Which of the followings defines the change when demand curve shifts right? a. Increase in supply b. increase in demand c. a change in the quantity supplied and no change in supply
b. increase in demand
Traffic congestion is an example of a ________ a. positive externality b. negative externality c. pecuniary externality d. free-rider problem
b. negative externality
The number of logging firms increases. Which of the figures above best illustrates this change? a. demand shifts right b. demand shifts left c. Supply shifts left d. Supply shifts right
d. Supply shifts right
In a perfectly competitive market, ________. a. each seller charges a different price for its product b. there are restrictions on the entry of new firms c. bargaining over prices is a common phenomenon d. sellers produce identical goods
d. sellers produce identical goods
free rider problem is...
economic concept of a market failure that occurs when people are benefiting from resources, goods, or services that they do not pay for.
Tragedy of the commons
problem of overusing common resources
