Exam 1: Ten Principles of Economics

For most students, the earnings they give up to attend college are

For which of the following problems can well-designed public policy enhance economic efficiency?

The U.S. president who referred to inflation as "public enemy number one" was

Suppose the cost of flying a 200-seat plane for an airline is $100,000 and there are 10 empty seats on a flight. If the marginal cost of flying a passenger is $200 and a standby passenger is willing to pay $300, the airline should

When the government attempts to improve equality in an economy the result is often

One effect of the government-imposed seat belt law in the U.S. has been

Inflation and unemployment both increase as the money supply increases.

The business cycle is measured by the

Max and Maddy charge people to park on their lawn while attending a nearby craft fair. At the current price of $10, seven people park on their lawn. If they raise the price to $15, they know that only five people will want to park on their lawn. Whether they have seven or five cars parked on their lawn does not affect their costs. From this information it follows that

Resources are

The overriding reason why households and societies face many decisions is that

When the government redistributes income from the wealthy to the poor,

Economists use the term ______ to refer to an increase in the overall level of prices in the economy.

Cole is refinishing an antique china cabinet and has already spent $180 on the restoration. He expects to be able to sell the cabinet for $360. Cole discovers that he needs to do an additional $200 worth of work to make the cabinet worth $360 to potential buyers. He could also sell the cabinet now, without completing the additional work, for $100. What should Cole do?

Dee is an accomplished actress and a homeowner who pays a landscaper to maintain her lawn rather than do it herself. Dee has determined that she can earn more in the hour it would take her to work on her lawn than she must pay her landscaper. This scenario is an example of which principle of economics?

Large or persistent inflation is almost always caused by

Economists are particularly adept at understanding that people respond to

US citizens have better nutrition, better healthcare, and a longer life expectancy than citizens of Ghana. Which of the following conclusions can be drawn from this statement?

A rational decisionmaker takes an action if and only if the marginal cost exceeds the marginal benefit.

In a particular country in 2008, the average worker had to work 40 hours to produce 100 units of output. In that same country in 2018, the average worker needed to work 35 hours to produce 94.5 units of output. In that country, the productivity of the average worker