ECO 2023: Module 1 Questions & Answers

Which of the following can best be characterized as a subject of microeconomics? (Ch.1) - ANSWERSAn examination of how much of a particular good gets produced AnswerMaurice needs to purchase something that economists would label as "land" to help him produce cloth to sell to the fashion industry. Which of the following is an example of land? (Ch.1) - ANSWERSCotton to be woven into fabric AnswerWhich of the following scenarios most accurately reflects the concept of scarcity? (Ch.1) - ANSWERSBrett is a farmer with an open field on which he can plant either soybeans or corn. AnswerWhich of the following best describes the opportunity cost of attending a free concert at the local coffee shop? (Ch.1) - ANSWERSThe chance to play the latest video game with your roommate while you were at the concert AnswerLucinda collects Kewpie dolls, and can afford to buy up to six dolls. The table below describes the marginal benefit Lucinda gets for each additional doll she adds to her collection. Lucinda's Marginal Benefit of Kewpie Dolls Kewpie Dolls Marginal Benefit (dollars) 1 $15.00 2 12.00 3 9.00 4 6.00 5 3.00 6 0.00 a. If the price of Kewpie dolls is $6.00 per doll, how many dolls would Lucinda buy if she is rational? (Ch.1) - ANSWERS4 dolls AnswerLucinda collects Kewpie dolls, and can afford to buy up to six dolls. The table below describes the marginal benefit Lucinda gets for each additional doll she adds to her collection. Lucinda's Marginal Benefit of Kewpie Dolls Kewpie Dolls // Marginal Benefit (dollars) 1 $15.00 2 12.00 3 9.00 4 6.00 5 3.00 6 0.00 b. If the price of Kewpie dolls rose to $9.00 per doll, how many dolls would Lucinda buy if she is rational? (Ch.1) - ANSWERS3 dolls AnswerEmmanuel enjoys growing zucchini in his garden and then selling his produce at the local farmers' market. The table below shows his marginal benefit and marginal cost for each hour he spends in his garden per week. The figure below plots the marginal benefit and marginal cost points. Emmanuel's Marginal Benefit and Marginal Cost of Gardening Hours Spent Gardening // Marginal Benefit (dollars) // Marginal Cost (dollars) 1 $21 $3 2 18 6 3 15 9 4 12 12 5 9 15 6 6 18 7 3 21 a. Given the information above, what is Emmanuel's optimal amount of time spent gardening each week? (Ch.1) - ANSWERS4 hours AnswerEmmanuel enjoys growing zucchini in his garden and then selling his produce at the local farmers' market. The table below shows his marginal benefit and marginal cost for each hour he spends in his garden per week. The figure below plots the marginal benefit and marginal cost points. Emmanuel's Marginal Benefit and Marginal Cost of Gardening Hours Spent Gardening // Marginal Benefit (dollars) // Marginal Cost (dollars) 1 $21 $3 2 18 6 3 15 9 4 12 12 5 9 15 6 6 18 7 3 21 b. If Emmanuel were to spend 2 hours each week gardening: (Ch.1) - ANSWERSthe marginal benefit would exceed the marginal cost by $12.