Canvas Microeconomics Analysis Chapter 1 Quiz

Q1. Economics is the study of

• how government can control markets to make allocations more efficient.
• how markets function to distribute goods equitably and facilitate growth.
• how individuals make decisions based on their own self-interest.
• how societies allocate their scarce resources to satisfy their unlimited wants.

Q2. ___________ would be concerned with the price of pharmaceuticals.

• A macro economist
• A micro economist
• Neither a micro economist nor a macro economist
• Both a micro economist and a macro economist

Q3. “If Penn State begins to fine students for littering, our classrooms would be cleaner” is an example of

• a positive statement.
• a normative statement.
• an empirical statement.
• a fallacy.

Q4. A statement of economic theory that abstracts from the nuances of reality is

• a map.
• a model.
• a graph.
• a variable.

Q5. You can either go to a movie, go to a concert, or go out to eat tonight. You decide that your first choice is going to a concert, second choice is going out to eat, and third choice is going to a movie. So, you go to a concert. The opportunity cost of this decision is

• both going out to eat and going to a movie.
• going to a movie.
• going to a concert.
• going out to eat.

Q6. A cost that has already been incurred is a(n)

• unnecessary cost.
• sunk cost.
• avoidable cost.
• marginal cost.

Q7. Your opportunity cost of cutting hair at your barbershop is $20 per hour. Electricity costs $6 per hour, and your weekly rent is $250. You normally stay open nine hours per day. What is the marginal cost of staying open for one more hour?

• $276
• $26
• $250
• $37

Q8. Economics Airlines currently spends $20,000 per month in airport fees and $10,000 per flight for fuel, crew, and airplane maintenance. Economics Airlines currently offers 5 flights from State College to Detroit. What is the marginal cost of operating a 6th flight?

• $30,000
• $43,000
• $10,000
• $50,000

Q9. Each donut that you consume for breakfast costs $.75. The first donut gives you $2.00 worth of pleasure, with each subsequent donut providing $.50 less pleasure than the previous one. What is the marginal benefit of the third donut?

• $.75
• $.25
• $1.00
• $1.75

Q10. Suppose that Noah is very good at typing and Emma is better at filing. However, Noah is assigned to a filing task while Emma is assigned to a typing task. An economist would say that this is a(n) _____________ allocation.

• inefficient
• uneconomical
• wasteful
• corrupt