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MINNESOTA STATE UNIVERSITY, MANKATO / Economics / ECON 202 / powered by cognero economics answers

powered by cognero economics answers

powered by cognero economics answers

Description

School: Minnesota State University - Mankato
Department: Economics
Course: Principles of Microeconomics
Professor: Phillip miller
Term: Fall 2016
Tags: Microeconomic, supply and demand, and Econ; Economics; Mircroeconomics; Principles of Economics; Demand; Supply; opportunity cost
Cost: 50
Name: ECON 202 01 CHAPTER 1-4
Description: It covers a question sets from chapter 1-4
Uploaded: 12/06/2016
9 Pages 214 Views 0 Unlocks
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Name: Class: Date: Chapter 1 Question Set Econ 201 Principles of Macroeconomics Dr. Atrayee Ghosh Roy 1. Economics is the study of equitable distribution of goods and services within society. a. True b. False ANSWER: False 2. Because resources are scarce, a society can give all individuals the standard of living to which each aspires. a. True b. False ANSWER: False 3. Choosing not to go to a movie so that you can study for your exam is an example of a tradeoff. a. True b. False ANSWER: True 4. A rational decision maker takes an action if and only if the marginal benefit exceeds the marginal cost. a. True b. False ANSWER: True 5. Suppose one county in Missouri decides it wants to reduce alcohol consumption, so the county passes a law that raises the price of a bottle of beer by $1. As a result, people drive to other counties to drink alcohol, which results in an increase in drunk driving. This illustrates the principle that rational people think at the margin. a. True b. False ANSWER: False 6. The invisible hand ensures that individual buyers and sellers reach desirable outcomes that in many cases will maximize the well-being of society as a whole. a. True b. False ANSWER: True 7. A market economy cannot produce a socially desirable outcome because individuals are motivated by their own selfish interests. a. True b. False ANSWER: FalseCengage Learning Testing, Powered by Cognero Page 1 Name: Class: Date: Chapter 1 Question Set 8. Market failure refers to a situation in which the market allocates resources efficiently. a. True b. False ANSWER: False 9. Market power is the ability of a single person to have a substantial influence on market prices. a. True b. False ANSWER: True 10. Productivity is defined as the quantity of goods and services produced from each unit of labor input. a. True b. False ANSWER: TrueCengage Learning Testing, Powered by Cognero Page 2 Name: Class: Date: Chapter 2 Question Set Econ 201 Principles of Macroeconomics Dr. Atrayee Ghosh Roy Figure 1 1. Refer to Figure 1. What is the name of the model depicted in the figure? ANSWER: Circular Flow Model 2. Refer to Figure 1. What do the ovals represent in the figure? ANSWER: Market for Goods and Services Market for Factors of Production 3. Refer to Figure 1. What do the rectangles represent in the figure? ANSWER: Firms Households 4. Refer to Figure 1. What do the outer arrows represent in the figure? ANSWER: flow of dollars 5. Refer to Figure 1. What do the inner arrows represent in the figure? ANSWER: flow of inputs and outputs 6. Refer to Figure 1. What does the arrow going from oval A to rectangle 2 represent in the figure? ANSWER: goods and services bought 7. Refer to Figure 1. What does the arrow going from oval B to rectangle 2 represent in the figure? ANSWER: Income 8. Refer to Figure 1. What are two elements not included in this figure that could be included in a more complex model?Cengage Learning Testing, Powered by Cognero Page 1 Name: Class: Date: Chapter 2 Question Set ANSWER: government international trade Figure 2 Consider the production possibilities curve for a country that can produce sweaters, apples (in bushels), or a combination of the two. 9. Refer to Figure 2. The bowed outward shape of the production possibilities curve indicates that opportunity cost of apples in terms of sweaters is ANSWER: increasing. 10. Refer to Figure 2. Which point(s) on the graph is(are) efficient production possibilities? ANSWER: Q, R, U, and V 11. Refer to Figure 2. Which point(s) on the graph show unemployment of resources? ANSWER: T and W 12. Refer to Figure 2. Which point(s) on the graph is(are) unattainable given current resources and technology? ANSWER: S and X 13. Refer to Figure 2. What is the opportunity cost of moving from point T to point R? ANSWER: zero 14. Refer to Figure 2. What is the opportunity cost of moving from point R to point Q? ANSWER: 80 bushels of applesCengage Learning Testing, Powered by Cognero Page 2 Name: Class: Date: Chapter 3 Question Set Econ 201 Principles of Macroeconomics Dr. Atrayee Ghosh Roy Scenario 1 In country A a worker who works 40 hours can produce 200 pounds of rice or 100 pounds of broccoli. In country B a worker who works 40 hours can produce 160 pounds of rice or 120 pounds of broccoli. 1. Refer to Scenario 1 Which country, if either, has an absolute advantage producing rice? Defend your answer. ANSWER: Country A has an absolute advantage producing rice because it produces more in 40 hours than country B. 2. Refer to Scenario 1 Which country, if either, has an absolute advantage producing broccoli? Defend your answer. ANSWER: Country B has an absolute advantage producing broccoli because it produces more in 40 hours than country A. 3. Refer to Scenario 1 Which country, if either, has a comparative advantage producing rice? Defend your answer using the numbers given. ANSWER: Country A has a comparative advantage producing rice because its opportunity cost is 1/2 of a pound of broccoli and Country B’s opportunity cost is 3/4 of a pound of broccoli. 4. Refer to Scenario 1. Which country, if either, has a comparative advantage producing broccoli? Defend your answer using the numbers given. ANSWER: Country B has a comparative advantage producing broccoli because its opportunity cost is 4/3 units of rice and Country A’s opportunity cost is 2 units of rice. 5. Refer to Scenario 1. Give a range of prices in terms of pounds of rice per pound of broccoli at which the two countries would be both be willing to trade. ANSWER: Any price which is less than 2 pounds of rice per pound of broccoli but greater than 4/3 pound of rice per pound of broccoli. 6. If a person chooses self-sufficiency, then she can consume more than what she produces. a. True b. False ANSWER: False 7. Assume a farmer has the ability to produce corn and/or beans. Whenever the farmer spends 1 hour less producing corn and 1 hour more producing beans, he reduces his output of corn by 2 bushels and raises his output of beans by 3 bushels. In view of these assumptions, the farmer’s production possibilities frontier is bowed out. a. True b. False ANSWER: FalseCengage Learning Testing, Powered by Cognero Page 1 Name: Class: Date: Chapter 3 Question Set 8. It is possible for the U.S. to gain from trade with Germany even if it takes U.S. workers fewer hours to produce every good than it takes German workers. a. True b. False ANSWER: True 9. A production possibilities frontier is a graph that shows the combination of outputs that an economy should produce. a. True b. False ANSWER: False 10. Opportunity cost refers to how many inputs a producer requires to produce a good. a. True b. False ANSWER: False 11. International trade can make some individuals within a country worse off, even as it makes the country as a whole better off. a. True b. False ANSWER: TrueCengage Learning Testing, Powered by Cognero Page 2 Name: Class: Date: Chapter 4 Practice Questions Economics 201 Principles of Macroeconomics Dr. Atrayee Ghosh Roy Table 1 The table below shows the quantities demanded of milk per month by four families at various prices. Price of Gallon of Milk The Berman Family The Johnson Family The Harris Family The Patel Family $3.00 9 15 12 14 $4.00 8 12 10 10 $5.00 7 9 8 6 $6.00 6 6 6 2


What is the name of the model depicted in the figure?



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1. Refer to Table 1. If the four families listed are the only demanders in this market and the price of a gallon of milk is $4.00, what is the market quantity demanded? ANSWER: 40 gallons 2. Refer to Table 1. If the four families listed are the only demanders in this market and the price of a gallon of milk increases from $4.00 to $5.00, what is the change in the market quantity demanded? ANSWER: decreases by 10 gallons Figure 1 3. Refer to Figure 1. Using the points on the figure, describe the change that would occur if consumer incomes increase and this is an inferior good. ANSWER: C to A 4. Refer to Figure 1. Using the points on the figure, describe the change that would occur if the price of a substitute for this good becomes more expensive. ANSWER: A to CCengage Learning Testing, Powered by Cognero Page 1 Name: Class: Date: Chapter 4 Practice Questions Table 2 The following table shows the number of cases of water each seller is willing to sell at the prices listed. Price per case Alpine Springs Brook Mountain Cascade Waters Dew Good $0.00 0 cases 0 cases 0 cases 0 cases $3.00 100 cases 40 cases 60 cases 100 cases $6.00 200 cases 80 cases 120 cases 200 cases $9.00 300 cases 120 cases 180 cases 300 cases


What do the rectangles represent in the figure?




What do the ovals represent in the figure?



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5. Refer to Table 2. If all four suppliers operate in this market, what is the market quantity supplied when the price is $6.00 per case? ANSWER: 600 cases Figure 2 6. Refer to Figure 2. In this market for iPhones, the technology improves while all other factors remain constant. Which curve(s) shift(s) and in which direction? ANSWER: Supply shifts to the right. 7. Refer to Figure 2. In this market for iPhones, the technology improves while all other factors remain constant. Explain the change(s) in the equilibrium price and quantity. ANSWER: Equilibrium price decreases and quantity increases. 8. Refer to Figure 2. In this market for tablet computers, more suppliers enter the market and the price of laptops, a substitute good, increases, while all other factors remain constant. Which curve(s) shift(s) and in which direction? ANSWER: Demand shifts right and supply shifts right.Cengage Learning Testing, Powered by Cognero Page 2 Name: Class: Date: Chapter 4 Practice Questions Figure 3 Consider the market for 2-packs of light bulbs below. 9. Refer to Figure 3. What are the values of the equilibrium price and quantity? ANSWER: $4 and 200 10. Refer to Figure 3. At a price of $3, is there a shortage or surplus, and how large is the shortage/surplus? ANSWER: There is a shortage of 100. 11. Refer to Figure 3. At a price of $6, is there a shortage or surplus, and how large is the shortage/surplus? ANSWER: There is a surplus of 200.Cengage Learning Testing, Powered by Cognero Page 3
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