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ECON 201 EXAM | 97 Questions with Answers 100% Verified Correct| Already Passed
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ECON 201 EXAM | 97 Questions with Answers 100% Verified Correct| Already Passed
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ECON 201 EXAM | 97 Questions with Answers100% Verified Correct| Already Passed
An omitted variable is a variable that: - ✔✔has been left out, and if included, would explain
why the variables considered in a study are correlated.
When two variables move in the same direction, they are said to be: - ✔✔positively
correlated.
Making choices by selecting the best feasible option, given the available information is referred
to as: - ✔✔optimization
Which of the following is a step involved in optimization in levels? - ✔✔Calculating the total
net benefit of each alternative
Converting all costs and benefits into a common value of measurement
Choosing the alternative with the highest net benefit
If an alternative provides a benefit of $8 to an individual at a cost of $6, the net benefits of the
alternative equal: - ✔✔$2
If the total cost incurred in hiring five workers for an hour is $45, and the total cost incurred
when the sixth worker is hired is $60, the marginal cost of hiring the sixth worker is: -
✔✔$15
Which of the following statements is true? - ✔✔Data help establish whether theories match
reality
If the opportunity cost of time is $20 per hour, and an individual spends 20 hours in commuting
every month, his opportunity cost of commute is: - ✔✔$400 per month.
, When the market for a commodity is in equilibrium: - ✔✔no economic agent will want to
change his or her behavior
A student has two options: she can either surf the web, or work part-time. Working part-time
pays her $20 per hour. What is the student's opportunity cost of surfing the web for 5 hours? -
✔✔$100
Among a set of alternatives with the same total benefits, an individual is said to optimize if she
chooses an alternative that: - ✔✔has the lowest total cost.
If quantity of tea is measured on the horizontal axis and quantity of coffee is measured on the
vertical axis, an increase in the price of coffee will cause the budget constraint to: - ✔✔pivot
leftward along the vertical axis
Assume that a consumer can spend $20 on two goods-pens and pencils. If the price of one pen
is $5 and the price of one pencil is $2, which of the following combinations of the two goods
represents a point on the consumers budget constraint? - ✔✔2 pens and 5 pencils
A change in the slope of a budget constraint indicates: - ✔✔a change in the price of one of
the goods that causes a change in the opportunity cost.
Which of the following statements is true? - ✔✔Tastes and preferences of a consumer
determine the satisfaction she receives from consumption.
________ in economics is a measure of satisfaction or happiness that comes from consuming a
good or service. - ✔✔Utility
Which of the following examples best describes the Law of Demand? - ✔✔When the price of
bread doubles, John's consumption of bread halves.
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