ECON 110 ZIRLOTT TEST 1 | QUESTIONS AND ANSWERS | WITH COMPLETE SOLUTION.
The market for a Dell computer is composed of the following equations: Demand equation Qd=2000-3P;
Supply equation Qs=-1000+2P
1. based on the info, what is the equilibrium price?
2. what is the equilibrium quantity?
3. now consider what would happen to the market if Hewlett-Packet lowers the price of their computers
and at the same time there is a large decrease in the price of processor microchips:
a) there is a decrease in the demand and supply of dell computers, which results in a decrease in the
quantity of dell computers but price becomes unknown
b) there is an increase in the demand and supply of dell computers, which results in an increase in the
price and quantity of dell computers
c) there is an increase in the supply of dell computers and a decrease in demand, which results in a
decrease in the price of dell computers but the quantity becomes unknown
d) there is a decrease in the supply of dell computers - (ANSWER)1. $600
2. 200 units
3. C
How can you tell if a point on a graph is inefficient? - (ANSWER)its inside the curve
Justin decides to spend an additional hour working overtime rather than playing football with his
friends. he earns $6 an hour for his hour's work. his opportunity cost is... - (ANSWER)the enjoyment he
would have received playing football with his friends
Peter and Olivia work for a clothing store called Alternate Reality making both jeans and t-shirts. Peter
can make 40 t-shirts in one hour or 10 pairs of jeans in one hour. Olivia can make 30 t-shirts in one hour
or 15 pairs of jeans. Based on this info, answer:
-Who has the absolute advantage in making t-shirts and who has the absolute advantage in making
jeans? - (ANSWER)Peter has absolute advantage in tshirts
Olivia has absolute advantage in jeans
, ECON 110 ZIRLOTT TEST 1 | QUESTIONS AND ANSWERS | WITH COMPLETE SOLUTION.
Peter and Olivia work for a clothing store called Alternate Reality making both jeans and t-shirts. Peter
can make 40 t-shirts in one hour or 10 pairs of jeans in one hour. Olivia can make 30 t-shirts in one hour
or 15 pairs of jeans. Based on this info, answer:
-the opportunity cost of 1 t-shirt for Peter is... - (ANSWER)1/4 or 0.25 pairs of jeans
(How: 10 jeans/40 t-shirts = 10/40 = 1/4)
Peter and Olivia work for a clothing store called Alternate Reality making both jeans and t-shirts. Peter
can make 40 t-shirts in one hour or 10 pairs of jeans in one hour. Olivia can make 30 t-shirts in one hour
or 15 pairs of jeans. Based on this info, answer:
-the opportunity cost of 1 pair of jeans for Peter is... - (ANSWER)4 t-shirts
(How: 40 t-shirts/10 jeans = 40/10 = 4)
Peter and Olivia work for a clothing store called Alternate Reality making both jeans and t-shirts. Peter
can make 40 t-shirts in one hour or 10 pairs of jeans in one hour. Olivia can make 30 t-shirts in one hour
or 15 pairs of jeans. Based on this info, answer:
-the opportunity cost of 1 t-shirt for Olivia is... - (ANSWER)1/2 or 0.5 pairs of jeans
(How: 15 jeans/30 t-shirts = 15/30 = 1/2)
Peter and Olivia work for a clothing store called Alternate Reality making both jeans and t-shirts. Peter
can make 40 t-shirts in one hour or 10 pairs of jeans in one hour. Olivia can make 30 t-shirts in one hour
or 15 pairs of jeans. Based on this info, answer:
-the opportunity cost of 1 pair of jeans for Olivia is... - (ANSWER)2 t-shirts
(How: 30 t-shirts/15 jeans = 30/15 = 2)
Peter and Olivia work for a clothing store called Alternate Reality making both jeans and t-shirts. Peter
can make 40 t-shirts in one hour or 10 pairs of jeans in one hour. Olivia can make 30 t-shirts in one hour
or 15 pairs of jeans. Based on this info, answer:
-who has the comparative advantage in making t-shirts and who has the comparative advantage in
making jeans? - (ANSWER)Peter has CA in t-shirts
Olivia has CA in jeans
The market for a Dell computer is composed of the following equations: Demand equation Qd=2000-3P;
Supply equation Qs=-1000+2P
1. based on the info, what is the equilibrium price?
2. what is the equilibrium quantity?
3. now consider what would happen to the market if Hewlett-Packet lowers the price of their computers
and at the same time there is a large decrease in the price of processor microchips:
a) there is a decrease in the demand and supply of dell computers, which results in a decrease in the
quantity of dell computers but price becomes unknown
b) there is an increase in the demand and supply of dell computers, which results in an increase in the
price and quantity of dell computers
c) there is an increase in the supply of dell computers and a decrease in demand, which results in a
decrease in the price of dell computers but the quantity becomes unknown
d) there is a decrease in the supply of dell computers - (ANSWER)1. $600
2. 200 units
3. C
How can you tell if a point on a graph is inefficient? - (ANSWER)its inside the curve
Justin decides to spend an additional hour working overtime rather than playing football with his
friends. he earns $6 an hour for his hour's work. his opportunity cost is... - (ANSWER)the enjoyment he
would have received playing football with his friends
Peter and Olivia work for a clothing store called Alternate Reality making both jeans and t-shirts. Peter
can make 40 t-shirts in one hour or 10 pairs of jeans in one hour. Olivia can make 30 t-shirts in one hour
or 15 pairs of jeans. Based on this info, answer:
-Who has the absolute advantage in making t-shirts and who has the absolute advantage in making
jeans? - (ANSWER)Peter has absolute advantage in tshirts
Olivia has absolute advantage in jeans
, ECON 110 ZIRLOTT TEST 1 | QUESTIONS AND ANSWERS | WITH COMPLETE SOLUTION.
Peter and Olivia work for a clothing store called Alternate Reality making both jeans and t-shirts. Peter
can make 40 t-shirts in one hour or 10 pairs of jeans in one hour. Olivia can make 30 t-shirts in one hour
or 15 pairs of jeans. Based on this info, answer:
-the opportunity cost of 1 t-shirt for Peter is... - (ANSWER)1/4 or 0.25 pairs of jeans
(How: 10 jeans/40 t-shirts = 10/40 = 1/4)
Peter and Olivia work for a clothing store called Alternate Reality making both jeans and t-shirts. Peter
can make 40 t-shirts in one hour or 10 pairs of jeans in one hour. Olivia can make 30 t-shirts in one hour
or 15 pairs of jeans. Based on this info, answer:
-the opportunity cost of 1 pair of jeans for Peter is... - (ANSWER)4 t-shirts
(How: 40 t-shirts/10 jeans = 40/10 = 4)
Peter and Olivia work for a clothing store called Alternate Reality making both jeans and t-shirts. Peter
can make 40 t-shirts in one hour or 10 pairs of jeans in one hour. Olivia can make 30 t-shirts in one hour
or 15 pairs of jeans. Based on this info, answer:
-the opportunity cost of 1 t-shirt for Olivia is... - (ANSWER)1/2 or 0.5 pairs of jeans
(How: 15 jeans/30 t-shirts = 15/30 = 1/2)
Peter and Olivia work for a clothing store called Alternate Reality making both jeans and t-shirts. Peter
can make 40 t-shirts in one hour or 10 pairs of jeans in one hour. Olivia can make 30 t-shirts in one hour
or 15 pairs of jeans. Based on this info, answer:
-the opportunity cost of 1 pair of jeans for Olivia is... - (ANSWER)2 t-shirts
(How: 30 t-shirts/15 jeans = 30/15 = 2)
Peter and Olivia work for a clothing store called Alternate Reality making both jeans and t-shirts. Peter
can make 40 t-shirts in one hour or 10 pairs of jeans in one hour. Olivia can make 30 t-shirts in one hour
or 15 pairs of jeans. Based on this info, answer:
-who has the comparative advantage in making t-shirts and who has the comparative advantage in
making jeans? - (ANSWER)Peter has CA in t-shirts
Olivia has CA in jeans
