Chapter 1 The Scope and Method of EconomicsWhich of the following is NOT listed in the book as a reason to study economics?Among the fundamental concepts
... [Show More] in economics areWhich of the following is the best definition of economics?The rise of the modern factory system in England during the late eighteenth and early nineteenth centuries is known as theWhich of the following statements is NOT correct? A) Economics is a behavioral science. B) In large measure, economics is the study of how people make choices. C) If poverty was eliminated there would be no reason to study economics. D) Economic analysis can be used to explain how both individuals and societies make decisionsThe study of economics) Sunk costs are A) costs that cannot be avoided, because they have already been incurred. B) the costs of what we give up when we make a choice or a decision. C) the additional costs of producing an additional unit of a product. D) the additional costs of consuming an additional unit of a product.Suppose thatȱȱyou purchased a ticket to a jazz festival for $100 a month ago. Last week someone invited you to a hockey game on the same night as the jazz festival. You would much rather go to the hockey game than the jazz festival. You have tried unsuccessfully to sell the jazz festival ticket. Which of the following statements regarding this situation is correct?You have decided that you want to attend a costume party as Ironman. You estimate that it will cost $40 to assemble your costume. After spending $40 on the costume, you realize that the additional pieces you need will cost you $25 more. The marginal cost of completing the costume is A) $15. B) $25. C) $40. D) $65.The concept of opportunity cost A) is relevant only to economics. B) can be applied to the analysis of any decision-making process. C) applies to consumers but not to firms. D) refers only to actual payments and incomes.Opportunity cost is A) that which we forgo, or give up, when we make a choice or a decision. B) a cost that cannot be avoided, regardless of what is done in the future. C) the additional cost of producing an additional unit of output. D) the additional cost of buying an additional unit of a product.The reason that opportunity costs arise is that A) an economy relies on money to facilitate exchange of goods and services. B) resources are scarce. C) there are no alternative decisions that could be made. D) people have limited wants.Which of the following is NOT an opportunity cost of attending college? A) the tuition you pay B) the income you could have earned if you didnȇt attend college C) the alternative uses of the time you spend studying D) the cost of the food that you consume while you are attending college) If your tuition is $5,000 this semester, your books cost $600, you can only work 20 rather than 40 hours per week during the 15 weeks you are taking classes and you make $15 per hour, and your room and board is $3000 this semester, then your opportunity cost of attending college this semester is A) $5,600. B) $5,900. C) $10,100. D) $11,600.) If your tuition is $25,000 this semester, your books cost $1,500, you can only work 20 rather than 40 hours per week during the 15 weeks you are taking classes and you make $15 per hour, and your room and board is $7,500 this semester, then your opportunity cost of attending college this semester is A) $26,500. B) $26,800. C) $31,000. D) $38,500.If you own a building and you decide to use that building to open a book store, A) there is no opportunity cost of using this building for a book store because you own it. B) there is an opportunity cost of using this building for a book store because it could have been used in other ways. C) there are no sunk costs involved in this decision. D) the only cost relevant to this decision is the price you paid for the building.You own the Star Wars six DVD set. The opportunity cost of watching these DVDs for the second time A) is zero. B) is one-half the cost of the DVDs, as this is the second time you have watched it. C) is the value of the alternative use of the time you spend watching the DVDs. D) cannot be calculated.That which we forgo, or give up, when we make a choice or decision is called A) sunk cost. B) marginal cost. C) real cost. D) opportunity cost.Costs that cannot be avoided, regardless of what is done in the future, because they have already been incurred are A) total costs. B) sunk costs. C) marginal costs. D) allocative costs.If you can buy 9 DVDs forȱȱ$126 or you could buy 10 DVDs for $130, then the marginal cost of the tenth DVD is: A) $4. B) $13. C) $14. D) $130If you eat atȱȱa sushi restaurant that charges $20 for its all you can eat sushi special, then the marginal cost of your 10th piece of sushi is A) zero. B) $2. C) $200. D) $2,000A market in which profit opportunities are eliminated almost instantaneously is A) a laissez-faire market. B) a capitalist market. C) a socialist market. D) an efficient market.If information is less costly and more easily available, then usually this A) makes markets more efficient. B) makes markets less efficient. C) increases profit opportunities. D) increases the opportunity cost of acquiring more information.An efficient market is a market A) in which everyone always gets what they want. B) in which profit opportunities are eliminated almost instantaneously. C) in which profits are always very high and persistent. D) in which opportunity costs are zero.Related to the Economics in Practice on p. 6:ȱȱWhich one of the following best supports the argument that most of the value of Appleȇs iPod is in its conception and design? A) Appleȇs history of innovative product design includes the earliest use of a Graphic User Interface (GUI) in the home computer market. B) The iPod would not have been as successful without the development of Web sites that allow users to purchase and download music. C) Companies that assemble the iPod and those that manufacture iPod components together capture only a small fraction of the iPodȇs retail value. D) Increases in the costs of components will reduce the profitability of the iPod, although price increases can be passed on to consumers.Related to the Economics in Practice on p. 6: Which one of the following best explains why Appleȇs iPod is neither a pure import nor a pure export?There is great concern over the fact that millions of Americans do not have health insurance. A study of the costs and benefits of implementing a national health-insurance program is an example of A) laissez-faire economics. B) positive economics. C) labor economics. D) normative economics.An economist wants to understand the relationship between minimum wages and the level of teenage unemployment. The economist collects data on the values of the minimum wage and the levels of teenage unemployment over time. The economist concludes that a 1% increase in minimum wage causes a 0.2% increase in teenage unemployment. From this information he concludes that the minimum wage is harmful to teenagers and should be reduced or eliminated to increase employment among teenagers. 13) Refer to Scenario 1.1. The statement that a 1% increase in the minimum wage causes a 0.2% increase in teenage unemployment is an example ofStanley Jevons, an economist in the nineteenth century, noted a high correlation between economic prosperity and sunspots. Based on this observation he developed aȱȈsunspot theoryȈ of how the economy operated. We now know that JevonsWhenever the Democrats gain control of the Congress, spending on social programs increases; whenever Republicans gain control of the Congress, spending on defense increases. Hence, we know what the next party in control will do. This statement is an example ofI have lived in a house on the Mississippi River for many years and have never seen a flood. Therefore, there is no reason for anyone to buy flood insurance. This statement is an example ofThe economy was expanding during all of the years that I was a student, but as soon as I graduated, the economy contracted. Therefore, the labor market was waiting until I started looking for a job to contract. This statement is an example of) Experimental research in small cities suggests that mandating work for welfare recipients increases their income. Therefore, we should mandate work requirements for all welfare recipients. This statement is an example ofChapter 1 The Scope and Method of Economics ...........................................................................1 Chapter 2 The Economic Problem: Scarcity and Choice.............................................................28 Chapter 3 Demand, Supply, and Market Equilibrium................................................................55 Chapter 4 Demand and Supply Applications ..............................................................................95 Chapter 5 Introduction to Macroeconomics...............................................................................116 Chapter 6 Measuring National Output and National Income .................................................139 Chapter 7 Unemployment, Inflation, and LongȬRun Growth .................................................169 Chapter 8 Aggregate Expenditure and Equilibrium Output ...................................................199 Chapter 9 The Government and Fiscal Policy............................................................................239 Chapter 10 The Money Supply and the Federal Reserve System..............................................278 Chapter 11 Money Demand and the Equilibrium Interest Rate ................................................307 Chapter 12 Aggregate Demand in the Goods and Money Markets..........................................340 Chapter 13 Aggregate Supply and the Equilibrium Price Level ...............................................383 Chapter 14 The Labor Market in the Macroeconomy .................................................................419 Chapter 15 Policy Timing, Deficit Targeting, and Stock Market Effects ..................................455 Chapter 16 Household and Firm Behavior in the Macroeconomy: A Further Look ..............493 Chapter 17 LongȬRun Growth........................................................................................................535 Chapter 18 Debates in Macroeconomics: Monetarism, New Classical Theory,ȱȱ and SupplyȬSide Economics .......................................................................................566 Chapter 19 International Trade, Comparative Advantage, and Protectionism.......................598 Chapter 20 OpenȬEconomy Macroeconomics: The Balance of Payments and Exchange Rates .....................................................................................................635 Chapter 21 Economic Growth in Developing and Transitional Economies ............................667 [Show Less]