ECON 2030 FINAL LSU EXAM
QUESTIONS AND ANSWERS 100% PASS
2026 EDITION
Microeconomics - ANS -issues that affect individuals, firms, specific industries, specific jobs,
specific markets, etc.
-ex: dentist, sales manager, beef market, coffee market
macroeconomics - ANS -issues that affect the whole economy
-ex: inflation --> affects all prices/markets, unemployment rates --> affects all jobs, growth -->
affects well being of all individuals
reminder: economic growth=macroeconomic
"How has employment in the United States changed over the last 12 months?" is an example of
a _____ question. - ANS macroeconomic
"Eli Lilly is shedding 3,500 workers—over 8% of its global staff—and closing several facilities in a
bid to cut $500 million in annual costs. The American drugmaker's revenues were up 8% in the
first half of 2017, at more than $11 billion. But tougher times lie ahead as patents on blood-
thinning and ADHD treatments expire." This quote is an example of a news item about a _____
issue. - ANS microeconomic (only talking about one company, eli lilly)
"The European Central Bank said the euro zone grew faster than expected in the first half of the
year, and raised its growth forecast for the bloc for 2017, to 2.2%—the fastest pace in ten years.
France's president, Emmanuel Macron, threw his weight behind a German proposal for a
1
@2026 EDITION ALLRIGHTS RESERVED
,European Monetary Fund to dampen euro-zone economic shocks." This is an example of a news
item about a _____ issue. - ANS macroeconomic
benefit - ANS what is recieved
opportunity cost - ANS what is given up; benefit from the best alternative not chosen
rationality - ANS do something if the benefit is at least as great as the opportunity cost at the
time of the decision; benefit ≥ Opportunity Cost
sunk cost - ANS a monetary expenditure incurred regardless of the option chosen; irrelevant
to the decision
marginal cost - ANS the extra cost of doing one more unit of something
Suppose Remus decides to go fishing at Lake Pescaccio on his day off from work, but he faces a
choice: he can fish the east, south, or west side of the lake. His expected catch for the day is as
follows: 3 fish on the east side, 7 fish on the south side, or 5 fish on the west side. Everything
else held constant, Remus' benefit of fishing the east side of the lake is _____ fish. - ANS 3
Suppose Remus decides to go fishing at Lake Pescaccio on his day off from work, but he faces a
choice: he can fish the east, south, or west side of the lake. His expected catch for the day is as
follows: 3 fish on the east side, 7 fish on the south side, or 5 fish on the west side. Everything
else held constant, Remus' opportunity cost of fishing the east side of the lake is _____ fish.
What would be the answer if east=west? What about if east=south? - ANS 7; 7; 5
Suppose Remus decides to go fishing at Lake Pescaccio on his day off from work, but he faces a
choice: he can fish the east, south, or west side of the lake. His expected catch for the day is as
follows: 3 fish on the east side, 7 fish on the south side, or 5 fish on the west side. Suppose
further that Remus chose to fish the east side of the lake. Was Remus' decision rational? -
ANS no
2
@2026 EDITION ALLRIGHTS RESERVED
,Suppose rational decision-maker Harry faces a choice: he can either see Zoe Boekbinder or Beth
Patterson in concert. Suppose further that tickets to see Zoe are $10 each while tickets to see
Beth are $15 each and Harry has not yet obtained a ticket to see either performer. What is
Harry's benefit from seeing Beth in concert? - ANS the experience of seeing beth live
Suppose rational decision-maker Harry faces a choice: he can either see Zoe Boekbinder or Beth
Patterson in concert. Suppose further that tickets to see Zoe are $10 each while tickets to see
Beth are $15 each and Harry has not yet obtained a ticket to see either performer. What is
Harry's benefit from seeing Zoe in concert? - ANS the experience of seeing zoe live + $5
Suppose rational decision-maker Harry faces a choice: he can either see Zoe Boekbinder or Beth
Patterson in concert. Suppose further that tickets to see Zoe are $10 each while tickets to see
Beth are $15 each and Harry has not yet obtained a ticket to see either performer. What is
Hary's opportunity cost of seeing Beth? - ANS Getting to see Zoe live + 5 bucks
Suppose rational decision-maker Harry faces a choice: he can either see Zoe Boekbinder or Beth
Patterson in concert. Suppose further that tickets to see Zoe are $10 each while tickets to see
Beth are $15 each and Harry has not yet obtained a ticket to see either performer. What is
Harry's opportunity cost of seeing Zoe? - ANS getting to see Beth live
Suppose rational decision-maker Harry faces a choice: he can either see Zoe Boekbinder or Beth
Patterson in concert. Suppose further that tickets to see Zoe are $10 each while tickets to see
Beth are $15 each and Harry has not yet obtained a ticket to see either performer. What is
Harry's sunk cost in deciding which concert to attend? - ANS $10
Suppose a local retailer is running the following sale on 12-packs of Pepsi products: $5 each or
three for $12. What is the marginal cost of the first 12-pack of Pepsi purchased? second? third?
- ANS $5; $5; $2
Suppose a parking garage has the following pricing schedule: 0-2 Hours, $5; 2-4 Hours, $10; 4-8
Hours, $15. What is the marginal cost of the first hour of parking? Second? Third-6th? -
ANS $5; $0; $5; $0; $5; $0
3
@2026 EDITION ALLRIGHTS RESERVED
, production possibilities frontier (PPF) - ANS shows all maximum output possibilities for a
given input; any point below the PPF is inefficient; any point on the PPF is efficient; any point
above is unattainable (except through trade)
if a point is outside of the PPF, is it efficient or inefficient? - ANS neither, it's unattainable
Answer true or false to the following statement. Engaging in trade with other countries allows
the United States to consume outside of its production possibilities frontier. - ANS true
Albania is said to have the absolute advantage over Bulgaria in producing a good if: -
ANS Albania can produce more of the good per worker hour than Bulgaria can
absolute advantage - ANS higher productivity in making something
comparative advantage - ANS lower opportunity cost; better suited to the production of one
good than to the production of another good
specialization - ANS producing goods that have comparative advantage (lower opportunity
cost)
trade benefit - ANS benefit from specialization and trade (not about productivity, but cost)
Bulgaria is said to have the comparative advantage over Albania in producing a good if: -
ANS Albania has a higher opportunity cost of producing the good than does Bulgaria
OPPORTUNITY COST CALCULATION: - ANS Opportunity cost of what get = Productivity give up
/ Productivity get
check slides 8-14 of tutorial 2 - ANS mmhm
4
@2026 EDITION ALLRIGHTS RESERVED
QUESTIONS AND ANSWERS 100% PASS
2026 EDITION
Microeconomics - ANS -issues that affect individuals, firms, specific industries, specific jobs,
specific markets, etc.
-ex: dentist, sales manager, beef market, coffee market
macroeconomics - ANS -issues that affect the whole economy
-ex: inflation --> affects all prices/markets, unemployment rates --> affects all jobs, growth -->
affects well being of all individuals
reminder: economic growth=macroeconomic
"How has employment in the United States changed over the last 12 months?" is an example of
a _____ question. - ANS macroeconomic
"Eli Lilly is shedding 3,500 workers—over 8% of its global staff—and closing several facilities in a
bid to cut $500 million in annual costs. The American drugmaker's revenues were up 8% in the
first half of 2017, at more than $11 billion. But tougher times lie ahead as patents on blood-
thinning and ADHD treatments expire." This quote is an example of a news item about a _____
issue. - ANS microeconomic (only talking about one company, eli lilly)
"The European Central Bank said the euro zone grew faster than expected in the first half of the
year, and raised its growth forecast for the bloc for 2017, to 2.2%—the fastest pace in ten years.
France's president, Emmanuel Macron, threw his weight behind a German proposal for a
1
@2026 EDITION ALLRIGHTS RESERVED
,European Monetary Fund to dampen euro-zone economic shocks." This is an example of a news
item about a _____ issue. - ANS macroeconomic
benefit - ANS what is recieved
opportunity cost - ANS what is given up; benefit from the best alternative not chosen
rationality - ANS do something if the benefit is at least as great as the opportunity cost at the
time of the decision; benefit ≥ Opportunity Cost
sunk cost - ANS a monetary expenditure incurred regardless of the option chosen; irrelevant
to the decision
marginal cost - ANS the extra cost of doing one more unit of something
Suppose Remus decides to go fishing at Lake Pescaccio on his day off from work, but he faces a
choice: he can fish the east, south, or west side of the lake. His expected catch for the day is as
follows: 3 fish on the east side, 7 fish on the south side, or 5 fish on the west side. Everything
else held constant, Remus' benefit of fishing the east side of the lake is _____ fish. - ANS 3
Suppose Remus decides to go fishing at Lake Pescaccio on his day off from work, but he faces a
choice: he can fish the east, south, or west side of the lake. His expected catch for the day is as
follows: 3 fish on the east side, 7 fish on the south side, or 5 fish on the west side. Everything
else held constant, Remus' opportunity cost of fishing the east side of the lake is _____ fish.
What would be the answer if east=west? What about if east=south? - ANS 7; 7; 5
Suppose Remus decides to go fishing at Lake Pescaccio on his day off from work, but he faces a
choice: he can fish the east, south, or west side of the lake. His expected catch for the day is as
follows: 3 fish on the east side, 7 fish on the south side, or 5 fish on the west side. Suppose
further that Remus chose to fish the east side of the lake. Was Remus' decision rational? -
ANS no
2
@2026 EDITION ALLRIGHTS RESERVED
,Suppose rational decision-maker Harry faces a choice: he can either see Zoe Boekbinder or Beth
Patterson in concert. Suppose further that tickets to see Zoe are $10 each while tickets to see
Beth are $15 each and Harry has not yet obtained a ticket to see either performer. What is
Harry's benefit from seeing Beth in concert? - ANS the experience of seeing beth live
Suppose rational decision-maker Harry faces a choice: he can either see Zoe Boekbinder or Beth
Patterson in concert. Suppose further that tickets to see Zoe are $10 each while tickets to see
Beth are $15 each and Harry has not yet obtained a ticket to see either performer. What is
Harry's benefit from seeing Zoe in concert? - ANS the experience of seeing zoe live + $5
Suppose rational decision-maker Harry faces a choice: he can either see Zoe Boekbinder or Beth
Patterson in concert. Suppose further that tickets to see Zoe are $10 each while tickets to see
Beth are $15 each and Harry has not yet obtained a ticket to see either performer. What is
Hary's opportunity cost of seeing Beth? - ANS Getting to see Zoe live + 5 bucks
Suppose rational decision-maker Harry faces a choice: he can either see Zoe Boekbinder or Beth
Patterson in concert. Suppose further that tickets to see Zoe are $10 each while tickets to see
Beth are $15 each and Harry has not yet obtained a ticket to see either performer. What is
Harry's opportunity cost of seeing Zoe? - ANS getting to see Beth live
Suppose rational decision-maker Harry faces a choice: he can either see Zoe Boekbinder or Beth
Patterson in concert. Suppose further that tickets to see Zoe are $10 each while tickets to see
Beth are $15 each and Harry has not yet obtained a ticket to see either performer. What is
Harry's sunk cost in deciding which concert to attend? - ANS $10
Suppose a local retailer is running the following sale on 12-packs of Pepsi products: $5 each or
three for $12. What is the marginal cost of the first 12-pack of Pepsi purchased? second? third?
- ANS $5; $5; $2
Suppose a parking garage has the following pricing schedule: 0-2 Hours, $5; 2-4 Hours, $10; 4-8
Hours, $15. What is the marginal cost of the first hour of parking? Second? Third-6th? -
ANS $5; $0; $5; $0; $5; $0
3
@2026 EDITION ALLRIGHTS RESERVED
, production possibilities frontier (PPF) - ANS shows all maximum output possibilities for a
given input; any point below the PPF is inefficient; any point on the PPF is efficient; any point
above is unattainable (except through trade)
if a point is outside of the PPF, is it efficient or inefficient? - ANS neither, it's unattainable
Answer true or false to the following statement. Engaging in trade with other countries allows
the United States to consume outside of its production possibilities frontier. - ANS true
Albania is said to have the absolute advantage over Bulgaria in producing a good if: -
ANS Albania can produce more of the good per worker hour than Bulgaria can
absolute advantage - ANS higher productivity in making something
comparative advantage - ANS lower opportunity cost; better suited to the production of one
good than to the production of another good
specialization - ANS producing goods that have comparative advantage (lower opportunity
cost)
trade benefit - ANS benefit from specialization and trade (not about productivity, but cost)
Bulgaria is said to have the comparative advantage over Albania in producing a good if: -
ANS Albania has a higher opportunity cost of producing the good than does Bulgaria
OPPORTUNITY COST CALCULATION: - ANS Opportunity cost of what get = Productivity give up
/ Productivity get
check slides 8-14 of tutorial 2 - ANS mmhm
4
@2026 EDITION ALLRIGHTS RESERVED
