1) Bintu’s Production Possibilities FrontierJuba’s Production Possibilities Frontier
Bintu has a comparative advantage in the production of
a.bowls and Juba has a comparative advantage in the production of cups.
b.cups and Juba has a comparative advantage in the production of bowls.
c.both goods and Juba has a comparative advantage in the production of neither good.
d.neither good and Juba has a comparative advantage in the production of both goods.
2) Scenario 13-8
Wanda owns a lemonade stand. She produces lemonade using five inputs: water, sugar,
lemons, paper cups, and labor. Her costs per glass are as follows: $0.01 for water, $0.02
for sugar, $0.03 for lemons, $0.02 for cups, and $0.10 for the opportunity cost of her
labor. She can sell 300 glasses for $0.50 each.
What are Wanda’s explicit costs per glass?
a. $0.18
b. $0.10
c. $0.08
d. $0.02
3) Good assumptions simplify a problem without substantially affecting the answer.
a.True
b.False
4) Table 15-4
A monopolist faces the following demand curve:
If the monopolist produces 5 units, what is its marginal revenue? a. $100
b. $37.5
d.$15 d. $2.50
5) Resources are
a.scarce for households but plentiful for economies.
b.plentiful for households but scarce for economies.
c.scarce for households and scarce for economies.
d.plentiful for households and plentiful for economies.
6) Figure 15-19
If there are no fixed costs of production, monopoly profit without price discrimination
equals
a.$0.
b. $1,562.50.
c. $3,125.
d. $6,250.
7) Harry is 40 and black. Dan is 40 and white. Both work as plumbers, but Harry earns
more.
a.Dan is being discriminated against.
b.Harry might be discriminated against if he has more experience as a plumber.
c.Harry might be discriminated against if he has less training as a plumber.
d.Harry might be discriminated against if he works the day shift and Dan works the
night shift.
8) According to the neoclassical theory of distribution, the wages paid to John Deere
tractor assembly line workers are higher than those paid to fast food workers because
assembly line workers
a.have college degrees, on average, whereas fast food workers usually do not.
b.produce a product of greater market value than do fast food workers.
c.work in a less stressful environment than do fast food workers.
d.are less likely to belong to a labor union than are fast food workers.
9) If the demand curve and the supply curve for a good are straight lines, then the
deadweight loss that results from a tariff is represented on the supply-and-demand
graph by
a.the area of one triangle.
b.the area of one rectangle.
c.the combined areas of two different triangles.
d.the combined areas of two different rectangles.
10) If a market is characterized by a positive externality that is not the result of a
technology spillover,
a.the socially optimal level of output is less than the equilibrium level of output, and the
optimal price is greater than the equilibrium price.
b.the socially optimal level of output is greater than the equilibrium level of output, and
the socially optimal price is less than the equilibrium price.
c.the socially optimal level of output is greater than the equilibrium level of output, and
the socially optimal price is greater than the equilibrium price.
d.the socially optimal level of output is less than the equilibrium level of output, and the
socially optimal price is less than the equilibrium price.
11) If US workers can produce everything in less time than Mexican workers, it is not
possible for the US to gain from trade with Mexico.
a.True
b.False