Stephanie has decided to eat lunch between classes. She has ranked her choices, from highest to lowest as, (1 ) turkey sandwich, (2 ) tuna sandwich, (3 ) slice of cheese pizza, (4 ) cheeseburger.
The opportunity cost of the eating turkey sandwich is A) the combined value of the tuna sandwich, slice of cheese pizza and cheeseburger.
B) the value of tuna sandwich, the next best choice.
C) the value of the cheeseburger.
D) zero since she has satisfied a want.
Ques. 2According to the above figure, then the supply curve will
A) shift from S1 to S2.
B) shift from S2 to S1.
C) remain at S1.
D) shift either to the left or the right, but it is impossible to say without more information.
Ques. 3A market demand curve is found by
A) adding the prices each consumer would pay for each quantity.
B) adding the prices and the quantities demanded by a consumer.
C) adding the quantities demanded for each individual consumer at each price.
D) taking the demand curve of the representative consumer.
Ques. 4A severe drought has devastated cocoa plants, causing an increase in the price of chocolate. In the market for chocolate chip cookies
A) a surplus will arise.
B) supply has decreased and price has increased.
C) quantity has decreased and price has decreased.
D) quantity demanded has increased.
Ques. 5Jamal earns 160,000 per year and Josephina earns 80,000 per year. They both pay the same price to buy the identical automobile and each pays 1,600 in sales tax. In relation to their relative incomes, this is an example of a
A) regressive tax.
B) progressive tax.
C) proportional tax.
D) marginal tax.
Ques. 6Say's law states that
A) supply creates its own demand.
B) supply and demand are never equal.
C) demand may be greater than supply.
D) supply will usually be greater than demand.
Ques. 7The rationality assumption says that
A) people do not intentionally make decisions that would leave them worse off.
B) people never make decisions that would leave them worse off.
C) people do not respond to incentives since incentives require scarce resources.
D) all economic analysis must be normative.
Ques. 8We are given the individual demand curves for all of the people that consume Good Y. Which statement is TRUE about the market demand curve for Good Y?
A) The market demand curve is obtained by horizontally summing the individual demand curves.
B) The market demand curve is obtained by vertically summing the individual demand curves.
C) The market demand curve cannot be obtained because information on prices is missing.
D) The market demand curve cannot be obtained from individual demand curves.
Ques. 9Samia has decided that with the two hours in between classes she can do one of 3 things. She has ranked her choices, from highest to lowest as, (1 ) chat with her friends, (2 ) study economics or (3 ) take a nap.
The opportunity cost of chatting with her friends is A) the combined value of studying economics and taking a nap.
B) the value of studying economics, the next best use of time.
C) the value of chatting with her friends.
D) zero since she does not pay her friends to talk to her.
Ques. 10An increase in supply causes
A) quantity supplied to decrease.
B) supply and price to increase.
C) price to decrease.
D) price to increase.
Ques. 11According to the above figure, if steel mills ignore the cost of pollution, the equilibrium quantity of steel will most likely be
A) Q1.
B) Q2.
C) Q2 - Q1.
D) none of the above.
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