Assignment:
1.Which of the following topics is related to microeconomics?
Explanations of why recessions occur.
Determining how much output a firm should produce.
The rate of unemployment.
The rate of economic growth.
2.In a ______ economy, the allocation of resources is governed by voluntary trading among businesses and consumers.
capitalist
communist
socialist
traditional
3.Positive economic questions
involve value judgments.
address what ought to happen.
are potentially testable.
cannot be tested.
4.A useful theory must
apply to every conceivable situation.
be broadly applicable.
be agreed upon by all economists.
not be able to be refined.
5.In a natural experiment,
similar people face very different circumstances.
the circumstances of otherwise identical people differ entirely by chance.
the circumstances of one group of people is compared to a "control" group of people.
similar people face very similar circumstances.
6.Suppose the demand function for cable TV service is given by QCTV = 15 - 0.25 × PCTV + 0.0005 × M + 0.3 × PSTV, QCTV is the quantity of cable TV demanded (thousands of households), PCTV is the price of cable TV, M is income and PSTV is the price of satellite TV service. Suppose consumers' income is $50,000 and the price of satellite TV service is $90. At what price would the demand for cable TV services be equal to 55,000 households?
$67
$48
$12
There is not enough information to answer the question.
7.A product's ________ shows how much sellers of a product want to sell at each possible price, holding all other factors fixed.
supply function
supply curve
production function
total product curve
8. Which of the following is a factor that affects both the supply of and demand for a good?
Technology
Price of inputs
Consumers' income
Government regulations
9.Consider the relationship given by QCars = 100 + 4 × PCars - 2 × PSteel - 0.2 × PWorkers, where QCars is the quantity of cars supplied (in thousands), PCars is the price of cars (in thousands of dollars), PSteel is the price of steel, and PWorkers is the wage earned by autoworkers. If the price of steel is $10 per unit and the price of workers (the wage) is $20, how many cars will be supplied if the price of cars is $20,000?
96,000
156,000
204,000
960,000
10.If the demand for a good increases at the same time the supply of the good decreases, what happens to equilibrium price and quantity?
Equilibrium quantity increases, but the effect on equilibrium price is ambiguous.
Equilibrium quantity decreases, but the effect on equilibrium price is ambiguous.
Equilibrium price increases, but the effect on equilibrium quantity is ambiguous.
Equilibrium price decreases, but the effect on equilibrium quantity is ambiguous.
11.Total benefits minus total cost equals:
gross benefit.
marginal benefit.
net benefit.
incremental benefit.
12.Refer to Table 3.1. Suppose that you have a house that you rent out. If you keep the lawn maintained, you can charge a higher monthly rent for the house. Suppose your hourly wage from your job at the mall is $10, what is the net benefit of spending 12 hours per week maintaining the lawn of the house?
|
Hours per week maintaining lawn
|
Benefit (additional monthly rent)
|
|
0
|
$0.00
|
|
4
|
$150.00
|
|
8
|
$260.00
|
|
12
|
$330.00
|
|
16
|
$390.00
|
|
20
|
$450.00
|
$120
$210
$320
$330
14.Refer to Table 3.2, which shows some costs and benefits of having your car repaired. What is the marginal benefit of the 4th hour spent on repairs?
Table 3.2
|
Repair time (hours)
|
Cost of mechanic and parts ($)
|
Total benefit of repair ($)
|
|
0
|
2
|
0
|
|
1
|
160
|
585
|
|
2
|
375
|
1120
|
|
3
|
665
|
1570
|
|
4
|
1025
|
1945
|
|
5
|
1460
|
2240
|
|
6
|
1970
|
2450
|
$450
$375
$295
$920
15.Refer to Table 3.2, which shows some costs and benefits of having your car repaired. Suppose you use your car to deliver pizzas. If you earn $10 per hour delivering pizzas, what is the net benefit of 3 hours of car repairs?
|
Repair time (hours)
|
Cost of mechanic and parts ($)
|
Total benefit of repair ($)
|
|
0
|
2
|
0
|
|
1
|
160
|
585
|
|
2
|
375
|
1120
|
|
3
|
665
|
1570
|
|
4
|
1025
|
1945
|
|
5
|
1460
|
2240
|
|
6
|
1970
|
2450
|
$875
$1540
$905
There is not enough information to determine the net benefits.
16.Suppose that you can schedule a worker for up to 10 hours per day. The total benefit and total cost functions are B(H) = 1200 × √H and C(H) = 200H. The corresponding formulas for marginal benefit and marginal cost are MB(H) = 600/√H and MC(H) = 200. How many hours should you schedule the worker?
9 hours
8 hours
4 hours
0 hours