ECO 201 Final 3 Exam Questions
and Answers 100% Pass
The marginal productivity of labor is defied as the amount of output produced by a
particular level of an input. - ✔✔False
Accounting Profit is always ______________ Economic Profit because Economic Profit
____________________ - ✔✔greater than, Includes opportunity cost.
The marginal productivity of labor is defined as the additional output produced by an
additional unit of labor - ✔✔True
In Economics the short run is always defined as
the length of time needed to change capital
two years
one year
6 months
none of these - ✔✔none of these
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,If we observe decreasing marginal productivity or labor what must be true of total
output - ✔✔it is positive
If we say an economic agent is ___________________ we mean they are focused on their
utility. - ✔✔self-interested
It is possible to be concerned about and want to help others while still being self-
interested. - ✔✔True
If a firm has labor contracts that are in place for 7 years and the lease on the building
where the business operates is 4- years long the short run is defined ________ years -
✔✔7
The marginal productivity of labor is defined as the additional labor needed to produce
an additional unit of an output. - ✔✔False
In Economics, the motivation of all firms is to: - ✔✔maximize profits
If bundle one has utility of 30 and bundle two has utility of 60, if we use a
_________________ measure of utility we can say bundle two has twice as much utility
as bundle one. - ✔✔cardinal
We define ____________________ doing only those things that we believe will not make
us worse off - ✔✔rationality
The long run is defined as - ✔✔The amount of time it takes to be able to change all
inputs
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, A firm earning positive accounting profit will operate - ✔✔Uncertain
A firm earning profit will always stay open - ✔✔False
The negative slope of the demand curve is caused in part by decreasing marginal utility
- ✔✔True
We assume an Economic Agent to be - ✔✔Rational and Self-Interested
Assume bananas cost $1.00 a bunch and pretzels cost $2 a bag. If Pat's marginal utility
for the last bunch of bananas is 5 and marginal utility of the last bag of pretzels
consumed is 10 can we say that Pat is maximizing utility? - ✔✔True
Given the information in lecture, would you be comfortable in saying that because
bundle one gives Hal 10 units of utility and bundle two gives Hal 30 units of utility that
Hal prefers bundle two to bundle one? - ✔✔True
If a firm has zero-economic profit the firm will shut down. - ✔✔False
If the next worker we hire adds more to production than the worker we hired before we
can say - ✔✔Marginal productivity of labor is increasing
In Economics we prefer to _____________________ measure of utility over
______________________ measure because _____________________________. -
✔✔Ordinal, Cardinal, our utility functions are imprecise as we make them up.
We will consume until marginal utility is 0
EMILY CHARLENE © 2025, ALL RIGHTS RESERVED 3
and Answers 100% Pass
The marginal productivity of labor is defied as the amount of output produced by a
particular level of an input. - ✔✔False
Accounting Profit is always ______________ Economic Profit because Economic Profit
____________________ - ✔✔greater than, Includes opportunity cost.
The marginal productivity of labor is defined as the additional output produced by an
additional unit of labor - ✔✔True
In Economics the short run is always defined as
the length of time needed to change capital
two years
one year
6 months
none of these - ✔✔none of these
EMILY CHARLENE © 2025, ALL RIGHTS RESERVED 1
,If we observe decreasing marginal productivity or labor what must be true of total
output - ✔✔it is positive
If we say an economic agent is ___________________ we mean they are focused on their
utility. - ✔✔self-interested
It is possible to be concerned about and want to help others while still being self-
interested. - ✔✔True
If a firm has labor contracts that are in place for 7 years and the lease on the building
where the business operates is 4- years long the short run is defined ________ years -
✔✔7
The marginal productivity of labor is defined as the additional labor needed to produce
an additional unit of an output. - ✔✔False
In Economics, the motivation of all firms is to: - ✔✔maximize profits
If bundle one has utility of 30 and bundle two has utility of 60, if we use a
_________________ measure of utility we can say bundle two has twice as much utility
as bundle one. - ✔✔cardinal
We define ____________________ doing only those things that we believe will not make
us worse off - ✔✔rationality
The long run is defined as - ✔✔The amount of time it takes to be able to change all
inputs
EMILY CHARLENE © 2025, ALL RIGHTS RESERVED 2
, A firm earning positive accounting profit will operate - ✔✔Uncertain
A firm earning profit will always stay open - ✔✔False
The negative slope of the demand curve is caused in part by decreasing marginal utility
- ✔✔True
We assume an Economic Agent to be - ✔✔Rational and Self-Interested
Assume bananas cost $1.00 a bunch and pretzels cost $2 a bag. If Pat's marginal utility
for the last bunch of bananas is 5 and marginal utility of the last bag of pretzels
consumed is 10 can we say that Pat is maximizing utility? - ✔✔True
Given the information in lecture, would you be comfortable in saying that because
bundle one gives Hal 10 units of utility and bundle two gives Hal 30 units of utility that
Hal prefers bundle two to bundle one? - ✔✔True
If a firm has zero-economic profit the firm will shut down. - ✔✔False
If the next worker we hire adds more to production than the worker we hired before we
can say - ✔✔Marginal productivity of labor is increasing
In Economics we prefer to _____________________ measure of utility over
______________________ measure because _____________________________. -
✔✔Ordinal, Cardinal, our utility functions are imprecise as we make them up.
We will consume until marginal utility is 0
EMILY CHARLENE © 2025, ALL RIGHTS RESERVED 3
