BE 301 KU EXAM 1 2025 QUESTIONS
AND ANSWERS
Amount of money he or she is willing to pay - ANS An individuals value for a good or service
is the
It creates wealth by letting a person follow his or her own self-interest - ANS The biggest
advantage of capitalism is that
With private property rights
With strong contract enforcement
With black markets
d.All of the above (answer) - ANS Wealth-creating transactions are more likely to occur
Provides incentives to conduct business in an illegal black market - ANS Government
Regulation
minimum wages - ANS An example of a price floor is
Impede the movement of assets to higher-valued uses.
Reduce incentives to work
Decreases the number of wealth creating transactions
d.All of the above (answer) - ANS Taxes:
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, $6,000 worth of buyer surplus and $4,000 worth of seller surplus - ANS A consumer values a
car at $30,000 and it costs a producer $20,000 to make the same car. If the transaction is
completed at $24,000, the transaction will generate
$523,800 - ANS A consumer values a car at $525,000 and a producer values the same care at
$485,000. If sales tax is 8% and is levied on the seller, then the sellers bottom line price is
Never - ANS Efficiency implies opportunity,
$300,000 - ANS A business owner makes 1,000 items a day. Each day he or she contributes
eight hours to produce those items. If hired, elsewhere he or she could have earned $250 an
hour. The item sells for $15 each. Production does not stop during weekends. If the explicit
costs total $150,000 for 30 days, the firm's accounting profit for the month equals:
$240,000 - ANS A business owner makes 1,000 items a day. Each day he or she contributes
eight hours to produce those items. If hired, elsewhere he or she could have earned $250 an
hour. The item sells for $15 each. Production does not stop during weekends. If the explicit
costs total $150,000 for 30 days, the economic profit for the month equals:
resource scarcity - ANS Opportunity costs arise due to
the income he could have earned at the car dealership - ANS After graduating from college,
Jim had three choices, listed in order of preference: (1) move to Florida from Philadelphia, (2)
work in a car dealership in Philadelphia, or (3) play soccer for a minor league in Philadelphia. His
opportunity cost of moving to Florida includes
by taking all capital costs into account including the cost of equity - ANS Economic Value
Added helps firms to avoid the hidden-cost fallacy
a. a firm considers irrelevant costs.
b. a firm ignores relevant costs.
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AND ANSWERS
Amount of money he or she is willing to pay - ANS An individuals value for a good or service
is the
It creates wealth by letting a person follow his or her own self-interest - ANS The biggest
advantage of capitalism is that
With private property rights
With strong contract enforcement
With black markets
d.All of the above (answer) - ANS Wealth-creating transactions are more likely to occur
Provides incentives to conduct business in an illegal black market - ANS Government
Regulation
minimum wages - ANS An example of a price floor is
Impede the movement of assets to higher-valued uses.
Reduce incentives to work
Decreases the number of wealth creating transactions
d.All of the above (answer) - ANS Taxes:
COPYRIGHT © 2025 BRAINBARTER ALL RIGHTS RESERVED 1
, $6,000 worth of buyer surplus and $4,000 worth of seller surplus - ANS A consumer values a
car at $30,000 and it costs a producer $20,000 to make the same car. If the transaction is
completed at $24,000, the transaction will generate
$523,800 - ANS A consumer values a car at $525,000 and a producer values the same care at
$485,000. If sales tax is 8% and is levied on the seller, then the sellers bottom line price is
Never - ANS Efficiency implies opportunity,
$300,000 - ANS A business owner makes 1,000 items a day. Each day he or she contributes
eight hours to produce those items. If hired, elsewhere he or she could have earned $250 an
hour. The item sells for $15 each. Production does not stop during weekends. If the explicit
costs total $150,000 for 30 days, the firm's accounting profit for the month equals:
$240,000 - ANS A business owner makes 1,000 items a day. Each day he or she contributes
eight hours to produce those items. If hired, elsewhere he or she could have earned $250 an
hour. The item sells for $15 each. Production does not stop during weekends. If the explicit
costs total $150,000 for 30 days, the economic profit for the month equals:
resource scarcity - ANS Opportunity costs arise due to
the income he could have earned at the car dealership - ANS After graduating from college,
Jim had three choices, listed in order of preference: (1) move to Florida from Philadelphia, (2)
work in a car dealership in Philadelphia, or (3) play soccer for a minor league in Philadelphia. His
opportunity cost of moving to Florida includes
by taking all capital costs into account including the cost of equity - ANS Economic Value
Added helps firms to avoid the hidden-cost fallacy
a. a firm considers irrelevant costs.
b. a firm ignores relevant costs.
COPYRIGHT © 2025 BRAINBARTER ALL RIGHTS RESERVED 2
