Exam 1: Ten Principles of Economics

In a particular country in 2000, the average worker needed to work 40 hours to produce 55 units of output. In that same country in 2008, the average worker needed to work 30 hours to produce 45 units of output. In that country, the productivity of the average worker

Rational people make decisions "at the margin" by comparing

The marginal benefit Susie gets from purchasing a third pair of gloves is

Economists study how people make decisions.

Which of the following phrases best captures the notion of efficiency?

Inflation increases the value of money.

Trade can make everyone better off except in the case where one person is better at doing everything.

Yvette buys and sells real estate. Two weeks ago, she paid $300,000 for a house on Pine Street, intending to spend $50,000 on repairs and then sell the house for $400,000. Last week, the city government announced a plan to build a new landfill on Pine Street just down the street from the house Yvette purchased. As a result of the city's announced plan, Yvette is weighing two alternatives: She can go ahead with the $50,000 in repairs and then sell the house for $290,000, or she can forgo the repairs and sell the house as it is for $250,000. She should

Scenario 1-5 Suppose that you have a choice between going to the movies with a friend for three hours or working at your job. If you go to the movies, you will spend $12 on a ticket and $6 on popcorn. If you choose to work, you will earn $10 an hour. -Refer to Scenario 1-5. What is your opportunity cost of working?

Which of the following is an example of an externality?

The marginal benefit Kyra gets from eating a second sandwich is

The mainstream view among economists is that

A bagel shop sells fresh baked bagels from 5

A likely effect of government policies that redistribute income and wealth from the wealthy to the poor is that those policies

The terms equality and efficiency are similar in that they both refer to benefits to society. However they are different in that

What is the main difference between a centrally planned economy and a market economy?

After much consideration, you have chosen Cancun over Ft. Lauderdale as your Spring Break destination this year. However, Spring Break is still months away, and you may reverse this decision. Which of the following events would prompt you to reverse this decision?

The relatively low inflation experienced in the United States in the 1990s is attributable to

It costs a meat-processing company $50,000 to produce 5,000 pounds of steak. The company's cost will be $50,009 if it produces an additional pound of steak. If the company produces 5,001 pounds of steak then

Give an example of government intervention that is intended to improve equality.