Exam (elaborations)
ECON 101-200 Winter 2024 Quiz 1 Answer Key
- Course
- ECON 101
- Institution
- University Of Michigan
ECON 101-200 Winter 2024 Quiz 1 Answer Key ECON 101-200 Winter 2024 Quiz 1 Answer Key
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ECON 101-200Winter 2024
Quiz 1
75 Points Possible
Version: 1
Name: KEY
Student ID Number:
[Please Print Clearly]
Question ‘X’:
Note:
This quiz is closed notes and book. Use of any outside resources (aside from a pencil, eraser, and basic
calculator) will be considered an act of academic misconduct.
Point values are listed on each question, in each part where relevant.
Be sure to print your multiple-choice answer clearly in the boxes
provided. Other marks will be ignored!!!
Assume demand slopes downward and supply slopes upward unless otherwise stated.
Assume demand and supply curves are straight lines, unless otherwise stated.
FYI: Multiple Choice are sorted alphabetically or numerically to ensure the answer is random.
You have 60 minutes from when the GSI starts the timer.
Good luck!!
, Econ 101-200 Winter 2024 Quiz 1 – Version 1
Name ID#
(Economic Models) Sweet Martha’s Cookie Jar is a famous stand at the Minnesota State Fair that produces chocolate chip cookies
and oatmeal raisin cookies (they are known for their bucket full of cookies). Suppose Sweet Martha’s can only run the stand for 10
hours since the state fair only opens from 10 AM to 8 PM. If the stand spends all the time on making chocolate chip cookies, the stand
can produce 80 gallons of chocolate chip cookies. If the stand spends all the time on making oatmeal raisin cookies, the stand can
produce 50 gallons of oatmeal raisin cookies. Assume Sweet Martha’s Cookie Jar experiences constant opportunity costs.
1. [4 points] In the space provided, plot Sweet Martha’s Cookie Jar’s Production Possibilities Frontier. Clearly label
this PPF1.
Sweet Martha's Cookies
120
100
Gallons of Chocolate Chip Cookies
PPF3
80
PPF4
60
40
20
PPF1
0
0 20 40 60 80 100 120
Gallons of Oatmeal Cookies
Question 2:
2. [3 points] Which of the following combinations is feasible but inefficient? [Hint: your graph may help you find the
answer.]
A. 20 gallons of oatmeal cookies and 60 gallons of chocolate chip cookies.
B. 25 gallons of oatmeal cookies and 40 gallons of chocolate chip cookies.
C. 30 gallons of oatmeal cookies and 32 gallons of chocolate chip cookies.
D. 35 gallons of oatmeal cookies and 20 gallons of chocolate chip cookies.
3. [4 points] Suppose Sweet Martha’s owners buy a new machine that is able to crack eggs faster. Eggs are used to make
both chocolate chip cookies and oatmeal cookies. Draw a new hypothetical Production Possibilities Frontier that
demonstrates the effect this would have on Sweet Martha’s. [Assume time is the primary constraining resource in the
production of cookies.] Clearly label this PPF3.
4. [4 points] Before buying the new egg cracking machine, Sweet Martha’s owners decide to buy a machine that
produces more chocolate chips at a faster rate. Draw a new hypothetical Production Possibilities Frontier that
demonstrates the effect this would have on Sweet Martha’s. [Hint: consider this independent of the egg cracking
machine in the prior question. Again, assume time is the primary constraining resource in the production of
cookies.] Clearly label this PPF4.
Nothing written below this line will be graded.
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