Table 7-1
Rob Crusoe and Bill Friday spent their week-long vacation on a desert island where
they had to find and make their own food. Rob and Bill spent one day each fishing and
picking berries. The table lists the pounds of output Rob and Bill produced. Use the
table above to select the statement that accurately interprets the data in the table.
A) Bill has a greater opportunity cost than Rob for picking berries.
B) Bill’s opportunity cost for catching fish is less than Rob’s.
C) Rob has a greater opportunity cost than Bill for picking berries.
D) Bill’s opportunity cost for picking berries and catching fish are both greater than
Rob’s.
With the exception of during recessions, workers in Canada are eligible for
unemployment benefits for about twice as long a period of time as workers in the
United States. As a result,
A) the average duration of unemployment is longer in the United States than in Canada.
B) the unemployment rate in Canada is usually higher than in the United States.
C) the opportunity cost of job search in Canada is lower than in the United States.
D) frictional unemployment is higher, on average, in the United States than in Canada.
An increase in the value of the U.S. dollar will
A) reduce Canadian demand for winter homes in Florida.
B) increase Canadian demand for winter homes in Florida.
C) reduce the cost of homes in Florida for Canadian buyers.
D) increase the cost of homes in Florida for American buyers.
Figure 3-2
A decrease in the expected future price of the product would be represented by a
movement from
A) A to B.
B) B to A.
C) S1 to S2.
D) S2 to S1.
Figure 9-2 Suppose the U.S.
government imposes a $0.40 per pound tariff on rice imports. Figure 9-2 shows the
impact of this tariff. With the tariff in place, the United States
A) imports 16 million pounds of rice.
B) imports 9 million pounds of rice.
C) imports 15 million pounds of rice.
D) exports 31 million pounds of rice.
Figure 12-2
What is the amount of profit if the firm produces Q2units?
A) It is equal to the vertical distance c to g.
B) It is equal to the vertical distance c to Q2.
C) It is equal to the vertical distance g to Q2.
D) It is equal to the vertical distance c to g multiplied by Q2units.
What is the endowment effect?
A) the tendency of people to be unwilling to sell something they already own even if
they are offered a price that is greater than what they would be willing to pay to buy the
good if they did not already own it
B) the tendency of people to be unwilling to sell something they already own because
of its sentimental value
C) the tendency of people to overstate the value of a good they already own even
though similar items can be purchased at a lower price
D) the sum total of assets that a person has acquired over the years
If the price elasticity of demand for canned soup is estimated at -1.62. What happens to
sales revenue if the price of canned soup rises?
A) It falls by 162 percent.
B) It rises by 1.62 percent.
C) It falls.
D) It rises.
The purchase of Treasury securities by the Federal Reserve will, in general,
A) not change the money supply.
B) not change the quantity of reserves held by banks.
C) increase the quantity of reserves held by banks.
D) decrease the quantity of reserves held by banks.
Figure 29-1
Europe experiences an economic boom. Assuming all else remains constant, this would
be represented as a movement from
A) D to A.
B) D to C.
C) C to B.
D) B to A.