Brent decides to purchase ground beef to make tacos rather than pricier steak because his weekly budget restricts his expenditure on food.

Brent is acting as a rational consumer in that he is recognizing that __________.

• he is purchasing where his marginal cost is greater than his marginal benefit
• he is keeping his total costs below his variable costs
• he is spending beyond his budget to feed his family
• he needs to stay within his budget constraint

When Joe went back to college to finish his degree in Economics, he cut back from full-time to part-time work at his firm. During this time, the lease on his SUV ran out and he leased a smaller compact car as a result.

The smaller compact car is an example of which type of good?

• Normal
• Inferior
• Giffen
• Veblen

Joe paid $5,000 for a used car, but he was willing to pay as much as $10,000.

Which economic concept below corresponds to the example above?

• Ceteris paribus
• Deadweight loss
• Producer surplus
• Consumer surplus

A firm acts as a rational decision maker when its leaders decide to do which of the following?

• Entice investors by promising lower than average returns on investment
• Cut hours and workers in order to minimize costs
• Solely using labor in a production process, rather than a combination of labor and capital
• Using all of its resources in order to maximize production, regardless of profit

When examining how price affects either the supply or demand curve, economists apply the concept ofceteris paribus.

This most often translates into which of the following?

• Including all models of economic behavior when making a decision
• Examining each of the factors of production before making a decision
• Holding other factors constant andonlyexamining effect of price on supply and demand
• Taking all factors affecting demand into consideration

During the Great Recession, many investors purchased gold and other precious metals, thinking they would be reliable forms of investment.

If we looked at this phenomenon on a graph, we would see which of the following?

• Movement up the demand curve
• Shift in demand
• Movement down the demand curve
• Shift in supply

Which of the following is not considered a factor of production?

• A printer to make copies for a company
• Interest earned on an investment
• The employees for a gas station
• The property that a factory is built on

A firm trying to maximize profit will produce up to the point that marginal revenue is __________.

• equal to marginal benefit
• equal tomarginal cost
• less than marginal benefit
• greater than marginal cost

Which choice below is NOT an example of an intermediate good?

• Juice that is used in a mixed drink sold at a bar
• Cloth used to make clothing sold at a mall
• Vegetables in a salad sold at a restaurant
• Orange juice sold at a grocery store

Which one of the following examples would cause a movement along the demand curve?

• The price of a service remains constant, but changes in preferences affect demand.
• The price of a service remains constant, but achange of price in related goods affects demand.
• The price of a product decreases, therefore the quantity demanded increases.
• The price of a service remains constant, but achange in income affects demand.

Identify which statement is a characteristic of long-run for a firm.

• Time period with at least one fixed element
• Time period of determining quantity and cost that yields the greatest profit
• Time period with the least control over constraints
• Time period when constraints are most likely to be variable

Which of the following is an example of macroeconomics?

• An analysis of the most efficient way for a small business to produce the highest quality of goods while achieving the highest profit
• A restaurant owner's decision on whether to open another location or to expand the current building
• A study that analyzes the reasons why one nation's economy has grown faster than another nation's economy
• A consumer's decision whether to spend a weekly paycheck on a small vacation or to stay home and save that weekly pay

Alex was shopping for his son's birthday party and had already purchased $75 worth of supplies. He was debating whether or not to spend another $25 for a piata.

Which statement below best defines marginal cost?

• The $75 he had already spent
• The $100 amount he was considering spending overall
• What he will have to give up in his budget to afford the total bill
• The $25 for thepiata

Movement along the supply curve is most likely caused by which of the following?

• Changes in marketprice
• Government taxes or subsidies
• Technological changes
• Changes in input prices

Which answer choice below is NOT an example of microeconomics?

• A study of how one's salary level influences spending on leisure items
• Analysis of the influence of changes in healthcare on a small business
• A study of whether or not the trade embargo against Iran has been successful
• An analysis of how a change in one's salary affects individual shopping habits

A real estate agency's policy is to start all sales commission negotiations at 6%. However, the agency is willing to accept sales commissions as low as 5%.

The scenario above is an example of which principle?

• Ceteris paribus
• Deadweight loss
• Consumer surplus
• Producer surplus

Anita gets a new job and her salary doubles. As a result, she moves to a bigger apartment in a trendy part of town.

Her new apartment, as a result of her increase in salary, can be categorized as which of the following two types of goods?

• Veblen and Normal
• Veblen and Inferior
• Giffen and Inferior
• Giffen and Normal

Maria had to decide whether to work an additional shift over the weekend or use the time to work on her lawn.

The sacrifice Maria makes by choosing one option over the other next best alternative is referred to as the __________.

• opportunity cost
• utility
• short-run constraint
• marginal benefit

Which answer choice below does NOT influence decision making for the rational consumer?

• Finite resources
• Utility maximization
• Profit maximization
• Opportunity cost

Which choice below is a factor in the process of resource allocation for consumers?

• Capital
• Time
• Short-run constraints
• Land