1. Julie is given a gift certificate for her birthday to get a manicure. Her opportunity cost of going to get the manicure is: Select one:

a.whatever else she would have done with that time.

b.the price of the manicure or whatever else she would have done with that time.

c.the price of the manicure.

d.zerothe manicure is free.

2. Some people get up extra early to go to work before the roads get congested. These people are:

a.thinking only about the benefits of avoiding traffic congestion.

b.over-estimating the value of less traffic congestion.

c.making marginal decisions by comparing the cost of leaving early to the benefit of leaving early.

d.not considering that the loss of sleep will make them feel more tired.

3. A grocery store offers two wage plans to its workers. Plan A offers a wage of $12 per hour. Plan B offers a wage of $10 per hour, plus the potential for more money if customers sign up for a store credit card. If a worker chooses plan B, the worker most likely would:

a.not change his or her behaviour at work.

b.be less friendly to customers compared to if he or she chose plan A.

c.be more friendly to customers compared to if he or she chose plan A.

d.have made the wrong decision.

4. Which of the following is one of the main characteristics of a market economy?

a.The objective of individuals is to maximize society's well-being

b.Sellers will sell as much as they can regardless of price

c.No waste resources

d.Firms must meet production quotas

5. Which of the following is a marginal choice?

a.the decision to build a factory or not

b.the decision to explore the oceans

c.The decision to hire one more worker

d.the decision to learn how to speak Spanish

6. In a market economy people decide whether to produce and exchange goods based on

a.government policy

b.what the people want

c.tradition

d.if everyone is equal

7. If people were less wasteful we could eliminate problems due to scarcity of resources a. False

b. True

8. Fazil is trying to decide if he should attend university or not. Suppose that he will be taking night classes at 7:00pm till 10:00pm, so he will not have to go to work. However, he will have to give up his free salsa dance lessons that he would have taken during that time. He will have to take the bus, which will cost him $5 a day, 7 a days a week in transit passes for 3 months he needs to attend classes. To go to salsa dance lessons, he would have had take the bus as well (for the same cost). To go to school, he will need books that will cost him $500, tuition that will cost him $10000 and he will also have to buy dinner which will cost $6 less compared to his usual evening meal at salsa lessons . He has decided to go to school and pay for the semester of classes, but he wants to skip the first 3 classes and take dance lessons instead. What is his opportunity cost of skipping the first 3 classes?

9. My children are making my shoulders hurt. Fortunately for me, they have given me a gift certificate to Molly's Muscle Message for Mother's Day that I can cash in whenever I like. Give this, we know that I am not in equilibrium. a. False b. True