Exam 1: Economics: Foundations and Models

Assume that an additional $800,000 in benefits will be received each year from the U.S. Postal Service delivering packages for Amazon on Sundays. What must the additional cost of this Sunday delivery policy be to make this policy economically rational?

Suppose the extra cost for a small nation to increase its mail delivery from six to seven days a week is $3,200 per year. Then, the nation should increase mail delivery to seven days a week if it can generate an additional benefit of $3,200 per year.

-Refer to Figure 1-2. Calculate the area of the triangle A.

Define microeconomics.

In 2019, Smileytown consumed 12,000 gallons of mouthwash. In 2020, mouthwash consumption rose to 17,000 gallons. Calculate the percentage change in mouthwash consumption.

DeShawn's Detailing is a service that details cars at the customers' homes or places of work. DeShawn's cost for a basic detailing package is $40, and he charges $75 for this service. For a total price of $90, DeShawn will also detail the car's engine, a service that adds an additional $20 to the total cost of the package. Should DeShawn continue to offer the engine detailing service?

The economic analysis of minimum wage involves both normative and positive analysis. Consider the following consequences of a minimum wage: A. The minimum wage law causes unemployment. B. A minimum wage law benefits some groups and hurts others. C. In some cities such as San Francisco and New York, it would be impossible for low-skilled workers to live comfortably in the city without minimum wage laws. D. The gains to winners of a minimum wage law should be valued more highly than the losses to losers because the latter primarily comprises businesses. Which of the consequences above are positive statements and which are normative statements?

Apple assembles most iPhones in China because the lower wages earned by Chinese workers and their experience in electronics manufacturing reduce the costs of assembling iPhones. This is an example of Apple reacting to which of the three key economic ideas?

In 2018, two members of Congress introduced the Stop Bad Employers by Zeroing Out Subsidies Act, which would tax firms whose employees receive government assistance. These members of Congress thought this legislation would give firms a reason to raise employee wages so fewer employees would receive the government assistance. Economists at the Center on Budget and Policy Studies believed that the implementation of this legislation would

Consider the following economic agents: A. the government B. consumers C. Producers Who, in a market economy, decides what goods and services will be produced with the scarce resources available in that economy?

Which of the following are primarily macroeconomic topics and which are primarily microeconomic topics? a. gasoline prices b. unemployment c. inflation d. health care costs e. air pollution f. economic growth

The prime minister of the tiny island nation of Wowza has proposed that the Wowzian Postal Service reduce mail delivery to its residents from 5 days a week to 3 days a week. Enacting this proposal would be optimal

The Trump administration promoted the tariffs on Chinese imports as a reason for firms to return manufacturing jobs to the United States from China. The administration's desire to get firms to return manufacturing to the United States through the implementation of tariffs was an attempt to get firms to follow which key economic idea?

In 2018, two members of Congress introduced the Stop Bad Employers by Zeroing Out Subsidies Act, which would tax firms whose employees receive government assistance. These members of Congress thought this legislation would give firms a reason to raise employee wages so fewer employees would receive the government assistance. These members of Congress were counting on firms reacting to which key economic idea?

One reason some manufacturing companies have moved production from China to other overseas locations is because of the tariffs implemented by the Trump administration on Chinese imports. Company managers using all available information, including the tariffs on Chinese imports, when making the decision to move production out of China and into other foreign nations exemplifies which key economic idea?

Suppose the extra cost to a small country of increasing mail delivery from 4 to 5 days a week is $60,000 per year. Then, the country should increase mail delivery from 4 to 5 days a week if doing so results in an additional benefit of less than $60,000 per year.

If the price of gasoline was $3.25 a gallon and it is now $3.75 a gallon, what is the percentage change in price?

Allison's Auto Art is a company that applies pinstripes to vehicles. Allison's cost for a basic 1-color pinstriping job is $35, and she charges $95 for this service. For a total price of $175, Allison will apply a fancier 3-color pinstripe application to an automobile, a service that adds an additional $40 to the total cost of the package. Should Allison continue to offer the 3-color pinstripe application?

According to the U.S. Census Bureau, income inequality in the United States was "significantly higher" in 2018 than in 2017, with the gap between the richest and poorest households the largest it has been in the last 50 years. At the same time, median U.S. income hit its highest level ever, with a national economy experiencing low unemployment and more than 10 years of consecutive GDP growth. According to Rutgers University Professor William M. Rogers III, the most troubling aspect of this report is that it "clearly illustrates the inability of the current economic expansion, the longest on record, to lessen inequality." The Census Bureau report also states that the nation's poverty rate fell in 14 states and Puerto Rico, and that for the 25 largest U.S. cities, the poverty rate either remained the same or fell in 2018. Source: Bill Chappell, "U.S. Income Inequality Worsens, Widening To A New Gap", NPR, September 26, 2019. -Refer to the Article Summary. The article discusses income inequality and how economic growth alone has not resulted in a more equitable distribution of income. What is meant by a more equitable distribution of income?

The U.S. Bureau of Labor Statistics forecasts that by 2026, total employment in U.S. manufacturing will