4 It takes time and effort to acquire knowledge. The concept of opportunity cost is most consistent with which of the following? A) Never spend more than 3 hours studying for a final exam. B) Never spend an hour on something when that hour could be spent doing something more valuable. C. Never make a decision until all the facts are in. D. Never say 'never.' Question 8 Sally regularly buys songs from iTunes. Assume that her demand for iTunes music is inelastic and the price of a tune from iTunes goes up. We would expect that: A. Sally would spend less on iTunes music B. Sally would spend more on iTunes music. C. Sally would download the same number of tunes from iTunes because music is a basic human need. D. Sally would download more tunes from iTunes. Question 9 Suppose the government imposes a $4 excise tax on Good Y, levied on sellers. If the demand for Good Y is perfectly elastic and the supply curve slopes upward, then the price of Good Y will: [Hint: draw the supply-demand graph.] A. increase by exactly $4. B. remain constant. C. increase by more than $4. D. increase, but by less than $4. Question 14 Bo and Archie have a pizza that they need to divide between the two of them. Which of the following ways of dividing the pizza are not efficient in consumption? A) Bo gets one-third of the pizza, Archie gets one-third, and one-third is thrown away. B) Bo gets the whole pizza and Archie gets nothing. C) Bo and Archie each get half the pizza. D) Bo gets one-third of the pizza, Archie gets one-third, and they toss a coin to see who gets the rest. Question 16 Which of the following statements is most true? A) Monopoly is inefficient because it makes too much profit. B) Monopoly is efficient because it is always more efficient for a single producer to specialize in a single task. C) Monopoly is inefficient because it chooses not to produce units of output that would provide net benefits to the economy. D) Monopoly is inefficient because a firm without competitors is bound to become lazy. Question 17 Which of the following is the best example of a positive externality? A.) Your neighbor has an ornamental pond that breeds mosquitoes. b) Your neighbor has invested in beautiful landscaping, increasing the value of all houses on the block. C) Alice's cattle trample your wheat D) The statement, "The unemployment rate is 17 percent