Econ 201 Fall 2011 (Perry)
Homework #1 (Ch. 1-3)
Name___________________________________
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers
the question.
1) Positive economic issues are ones that are
1) _______
A) about the interaction of individual consumers and firms in
markets.
B) focused on how scarce resources are allocated among competing
uses.
C) subjective in that the observer must make moral or ethical
judgments.
D) about the impact of major spending and producing units in the
economy.
E) testable and verifiable.
2) Demand curves can be re-labeled
2) _______
A) marginal revenue curves.
B) total benefit curves.
C) total revenue curves.
D) marginal cost curves.
E) marginal benefit curves.
3) In a competitive market,
A) the price at which an individual firm is willing to supply is equal
to the firm's anticipated revenue.
B) individual firm supply is equal to individual consumer demand.
C) individual firm supply is equal to what consumers are willing and
able to pay.
D) the price at which an individual firm is willing to supply is equal
to the firm's marginal costs of production.
E) individual firm supply is given by the market supply schedule.
3) _______
4) If a nation can produce a good or service at a lower opportunity cost
than a trading partner, we would conclude it
A) should not produce the product.
B) has a productivity advantage in the production of that output.
C) has a comparative advantage in the production of that output.
D) has an absolute advantage in the production of that output.
E) cannot gain from trade.
4) _______
5) If the price of a good is currently above the good's equilibrium price,
then
A) there will be no tendency for the price to change.
B) some buyers will not be able to buy as much as they want, and will
bid the price up.
C) some buyers will not be able to buy as much as they want, and will
bid the price down.
D) some sellers will not be able to sell as much as they want, and will
bid the price down.
5) _______
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6) Which of the following is true?
A) A free concert on campus would have no opportunity costs for the
people that attended, although it might have opportunity costs for
the university.
B) Opportunity costs exist for every activity undertaken and every
purchase made, no matter how small.
C) Bill Gates does not experience scarcity, so he doesn't have
opportunity costs for his decisions.
D) If no monetary payment is required, there is no opportunity cost.
E) Because the government has more resources, it does not face
opportunity costs.
6)
______
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