In economics, choices must be made because welive in a world of
Economists reason that the optimal decision isto continue any activity up to the point where the
Refer to Table above. What is Lydia's marginal benefit if she decides to stay open for twohours instead of one hour?
The production possibilities frontier shows the________ combinations of two products that may be produced in a particular timeperiod with available resources.
If the production possibilities frontier is________, then opportunity costs are constant as more of one good is produced.
Figure above shows the production possibilitiesfrontier for Mendonca, an agrarian nation that produces two goods, meat andvegetables. Refer to Figure above. What is the opportunity cost of one pound of meat?
1 1/3 pounds ofvegetables
Refer to Figure above. If the economy is currently producing at point Y, what is theopportunity cost of moving to point W?
Refer to Figure above. Which country has a comparative advantage inthe production of cotton?
The ________ demonstrates the roles played byhouseholds and firms in the market system.
Refer to Figure above. One segment of the circular flow diagram in thefigure shows the flow of labor services from market K to economic agentsJ. What is market K and who are economic agents J?
K= factor markets; J = firms
"An Inquiry into the Nature and Causes ofthe Wealth of Nations" published in 1776 was written by
Last year, the Pottery Palace supplied 8,000ceramic pots at $40 each. This year, the company supplied the same quantity ofceramic pots at $55 each. Based on this evidence, The Pottery Palace hasexperienced
Refer to Figure above. Ifthe current market price is $10, the market will achieve equilibrium by
a price increase, increasing the quantitysupplied and decreasing the quantity demanded.
Refer to Figure above. At a price of $15, the quantity bought
Assume that both the demand curve and thesupply curve for MP3 players shift to the right but the demand curve shiftsmore than the supply curve. As a result
If more insurance companies decide to coverpart of the price of voluntary laser eye surgery and more doctors decide toenter the field of laser eye surgery, what will happen in the market for lasereye surgery as a result of these two factors?
Lucinda buys a new GPS system for $250. She receives consumer surplus of $75from the purchase. How much doesLucinda value her GPS system?
Consumer surplus in a market for a productwould be equal to ________ if the market price was zero.
Refer to Figure above. What is the value of the deadweight loss at aprice of $18?
Refer toFigure above. What is the value of theProducer Surplus transferred to the consumer at a price of $13?
________ is maximized in acompetitive market when marginal benefit equals marginal cost.
Refer toFigure above. What is the value of consumer surplus after the imposition ofthe ceiling?
When there is a negative externality,the private cost of production ________ the social cost of production.
Refer to Figure above. One way to obtain the economically efficient amount ofcollege education is for governments to subsidize college education. What isthe size of the per-student Pigovian subsidy that the government must provideto internalize the external benefits? (Note that the subsidy can be granted tothe education institutions or to the students directly or indirectly; forexample, through low-interest student loans.)
Supposethat when the price per ream of recycled printer paper rises from $4 to $4.50,the quantity demanded falls from 800 to 600 reams per day. Using the midpointformula, what is the price elasticity of demand (in absolute value) over thisrange?
TheJapanese government feared that the alternative would be a tariff or quota onimports of Japanese automobiles imposed by the U.S. government.
1) Refer to Figure above.For what quantity of labor doesproduction display diminishing returns?
Refer to Table above.The table above refers to therelationship between the quantity of workers employed and the number ofcardboard boxes produced per day by Manny's House of Boxes. The capital used toproduce the boxes is fixed. Diminishing returns to labor are first observed inthis example after Manny hires the ________ worker.
Refer to Figure above.When output level is 100, what is theminimum total cost of production?
Which of the following statementsregarding a firm's long-run average total cost (LRATC) curve and itsshort-run average total cost (SRATC) curve is true?
The LRATC shows the lowest costat which a firm is able to produce a given level of output when no inputs arefixed.
Refer to Figure above. For output rates greater than 20,000 picture frames per month
Refer to same Figure above. If the firm chooses to produce and sell 25,000 frames permonth by operating in the short run with a scale operation represented by ATCc
Firms in perfectly competitiveindustries are unable to control the prices of the products they sell and earna profit in the long run. Which of the following is one reason for this?
Refer to Table above. What isMargie's total revenue if she sells 250 pounds of apples?
A perfectly competitive apple farmproduces 1,000 bushels of apples at a total cost of $36,000. The price of eachbushel is $50. Calculate the firm's short-run profit or loss.
Refer to Figure above. If the firm is producing 500 units,
Letters are used to represent the termsused to answer this question: price (P), quantity of output (Q),total cost (TC) and average total cost (ATC). Which of thefollowing equations is equal to a firm's average profit?
Refer to Table above.What will Arnie's output be and howmuch profit will he earn if the market price of basketballs is $5.00?
Refer to Figure above. Suppose the market price is $120. Which of the following istrue?
The De Beers diamond mining andmarketing company of South Africa became one of the most profitable andlongest-lived monopolies in history. Which of the following has alwaysthreatened De Beers' control of the diamond market?
Since few diamonds are ever destroyed,De Beers has constantly faced possible competition from other firms resellingdiamonds.
Refer to Figure above. Which of the following statements about the firm depictedin the diagram is true?
If price is equal to average variablecost, a perfectly competitive firm breaks even.
A monopolist's demand curve is the sameas the marginal revenue curve for the product.
The sales revenue a seller receives from the sale of an additional unit of goods is called the marginal benefit.
Consider a country that produces only two goods: kayaks and coconuts. Suppose it is possible for this country to increase its production of kayaks without producing fewer coconuts. In this case, its current output combination is efficient.
If a country produces only two goods, it is possible to have a comparative advantage in the production of both those goods.
Accounting costs exclude implicit costs.
If average product is decreasing, then marginal product must be negative.
If marginal cost is above the average variable cost, then average variable cost is decreasing.
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