1. What do economists mean when they state that a good is scarce?
a The amount of the good that people would like exceeds the supply freely available from
. nature.
b People will want to buy more of the good regardless of the price of the good.
.
c There is a shortage or insufficient supply of the good at the existing price.
.
d It is impossible to expand the availability of the good beyond the current amount.
.
2. Economic analysis assumes that
a people are basically humanitarian, and their actions are, therefore, impossible to predict.
.
b although individuals are at times selfish and at times unselfish, only their selfish actions may be
. predicted.
c changes in the personal benefits and costs associated with a choice will exert a predictable
. influence on human behavior.
d individuals act only out of selfish motives.
.
3. Jacob and Mason go to a diner that sells burritos for $5 and tacos for $3. They agree to split the
lunch bill evenly. Mason chooses a taco. The marginal cost to Jacob of ordering a burrito instead
of a taco is
a $3.
.
b $1.
.
c $2.
.
d $2.50.
.
4. While waiting in line to buy two tacos at 75 cents each, and a medium drink for 80 cents, Emma
notices that the restaurant has a value meal containing three tacos and a medium drink all for
$2.50. For Emma, the marginal cost of purchasing the third taco would be
a 20 cents.
.
b 80 cents.
.
c 75 cents.
.
d zero.
.
5. Which one of the following is a positive economic statement? (INCORRECT)
a The minimum wage should be increased.
.
b An increase in the minimum wage will reduce employment.
.
c Thoughtful people oppose an increase in the minimum wage.
a The amount of the good that people would like exceeds the supply freely available from
. nature.
b People will want to buy more of the good regardless of the price of the good.
.
c There is a shortage or insufficient supply of the good at the existing price.
.
d It is impossible to expand the availability of the good beyond the current amount.
.
2. Economic analysis assumes that
a people are basically humanitarian, and their actions are, therefore, impossible to predict.
.
b although individuals are at times selfish and at times unselfish, only their selfish actions may be
. predicted.
c changes in the personal benefits and costs associated with a choice will exert a predictable
. influence on human behavior.
d individuals act only out of selfish motives.
.
3. Jacob and Mason go to a diner that sells burritos for $5 and tacos for $3. They agree to split the
lunch bill evenly. Mason chooses a taco. The marginal cost to Jacob of ordering a burrito instead
of a taco is
a $3.
.
b $1.
.
c $2.
.
d $2.50.
.
4. While waiting in line to buy two tacos at 75 cents each, and a medium drink for 80 cents, Emma
notices that the restaurant has a value meal containing three tacos and a medium drink all for
$2.50. For Emma, the marginal cost of purchasing the third taco would be
a 20 cents.
.
b 80 cents.
.
c 75 cents.
.
d zero.
.
5. Which one of the following is a positive economic statement? (INCORRECT)
a The minimum wage should be increased.
.
b An increase in the minimum wage will reduce employment.
.
c Thoughtful people oppose an increase in the minimum wage.
