Exam 1: Economics: Foundations and Models

In 2012,Peelville consumed 30,000 bananas.In 2013,banana consumption rose to 35,000.Calculate the percentage change in banana consumption.

Human capital refers to

A university must decide if it should stop offering foreign language classes.This decision involves answering the economic question of "how to produce."

The branch of economics which studies the behavior of entire economies and policies that affect the economy as a whole is called

The basic economic problem of scarcity

Normative analysis is concerned with "what ought to be," while positive analysis is concerned with "what is."

Which of the following is a macroeconomics question?

The term "market" refers only to trading arrangements that have been approved by the government.

Which of the following statements is true about revenue?

Marginal cost is the ________ associated with undertaking an activity.

The branch of economics which studies how households and firms make choices,interact in markets and how government attempts to influence their choices is called

How are the fundamental economic decisions determined in Cuba?

Marginal benefit is the benefit that your activity provides to someone else.

Scenario 1-1 Suppose a t-shirt manufacturer currently sells 5,000 t-shirts per week and makes a profit of $10,000 per week. A manager at the plant observes, "Although the last 400 t-shirts we produced and sold increased our revenue by $4,000 and our costs by $4,800, we are still making an overall profit of $10,000 per week so I think we're on the right track. We are producing the optimal number of t-shirts." -Refer to Scenario 1-1.Had the firm not produced and sold the last 400 t-shirts,would its profit be higher or lower,and if so by how much?

Table 1-3 Ivan runs a custom jewelry shop in Sparkle City.He is debating whether he should extend his hours of operation.Ivan figures that his sales revenue will depend on the number of hours the jewelry shop is open as shown in the table above.He would have to hire a worker for those hours at a wage rate of $25 per hour. -Refer to Table 1-3.Using marginal analysis,determine how many hours should Ivan extend his hours of operations?

Suppose that to move more people off the wait list for organ donations,surgeons and hospitals are developing a market for organ swapping.This is an example of a macroeconomics topic.

When Dr.Goldfinger decides on the companies in which he will invest,a ________ issue is being addressed.

Zane's Vanes is a service that restores old weather vanes.Zane has just spent $125 purchasing a 1920s era weather vane which he expects to restore and sell for $500 once the work is completed.After having spent $125,Zane realizes that he will need to spend an additional $200 on materials to complete the restoration.Alternatively,he can sell the weather vane without restoring it for $200.What is his marginal benefit if he sells the weather vane without restoring it?

"An increase in the price of oranges will increase the demand for grapefruits." This statement is an example of a normative economic statement.

Which of the following are primarily macroeconomic topics and which are primarily microeconomic topics? a.college tuition rates b.farm subsidies c.national income d.automobile prices e.air traffic congestion f.economic recession