Exam 1: Economics: Foundations and Models

Mrs.Lovejoy decides to invest in companies which she believes can produce its goods at the lowest possible cost.Mrs.Lovejoy is investing in companies that are

What does the term "marginal" mean in economics?

In economics,the total amount received for selling a good or service is referred to as

"A decrease in the price of digital cameras will decrease the demand for camera film." This statement is an example of a positive economic statement.

At a recent company meeting,Geraldine Erwin,sales manager of Dastoria,a flavored beverage producer announced,"We have increased our sales by 8 percent in just six months." Suppose six months ago,its sales amounted to $452,000,what is the value of its sales today?

Economics promotes which of the following as the way to make the best decision?

It is necessary for all economic systems to provide people with goods and services and also restrict them from getting as much of these goods and services as they wish,because failure to do this could ________ the efficiency of the system by producing some goods and services that are ________.

If it costs Hobie $900 to produce 5 lamps and $1,200 to produce 6 lamps,then the difference of $300 is the marginal cost of producing the 5th lamp.

Which of the following is a microeconomics question?

Lionel's Lawn Care is a company that maintains residential yards.Lionel's cost for his standard package of mowing,edging,and trimming is $15,and he charges $25 for this service.For a total price of $40,Lionel will also trim shrubs,a service that adds an additional $10 to the total cost of the standard package.Should Lionel continue to offer the shrub-trimming service?

Consider the following statements: a.Consumers rent more DVDs from a video store that rents DVDs at a lower price than other rival video stores in the area. B.Department stores take steps to increase security since they believe it is more costly to allow shoplifting than to install expensive security monitoring equipment. C.Farmers produce more cotton when its selling price falls. Which of the above statements demonstrates that economic agents respond to incentives?

The term "market" in economics refers to

Which of the following is a macroeconomics question?

Suppose the extra cost to a doctor of keeping her office open on Saturdays is $800.Then,the doctor should not stay open on Saturdays if keeping the office open can only bring in additional revenue of $800.

Economists assume that

The Farm Factory,a booth at the local Farmer's Market,sells fresh eggs for $1.50 per dozen and fresh milk for $2.50 per gallon.What is the opportunity cost of buying a gallon of milk?

Allocative efficiency is achieved when

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.Using marginal analysis terminology,what is another economic term for the incremental revenue received from the sale of the last 400 t-shirts?

Table 1-2 Julius runs a small tailor shop in the city of Bloomfield.He is debating whether he should extend his hours of operation.Julius figures that his sales revenue will depend on the number of hours the tailor shop is open as shown in the table above.He would have to hire a worker for those hours at a wage rate of $18 per hour. -Refer to Table 1-2.What is Julius's marginal benefit if he decides to stay open for three hours instead of two hours?

If a straight line passes through the point x = 12 and y = 4 and also through the point x = 4 and y = 8,the slope of this line is