Question 1 (5 points)

Saved

Economic profit can be derived from calculating total revenues minus all of the firm's costs,

Question 1 options:

	including its opportunity costs
	excluding its opportunity costs
	including its marginal revenue
	excluding its marginal revenue

Question 2 (5 points)

Saved

Which of the following factors DOES NOT lead to a shift in the demand curve for a particular product?

Question 2 options:

	Tastes and Trends
	True Price of the Particular Product
	Income
	Prices of Other Goods

Question 3 (5 points)

Saved

Tom views beer and pizza as complements to one another. If the price of pizza decreases, economists would expect

Question 3 options:

	Tom's demand for pizza to increase
	Tom's quantity of pizza demanded to decrease
	Tom's demand for beer to increase
	Tom's demand for pizza to decrease

Question 4 (5 points)

Saved

Microeconomics is the study of ______, whereas macroeconomics is the study of ________.

Question 4 options:

a)	Economics at the individual level, economics at a national level.

b)	Small markets; large markets

c)	Small business economics, large business economics

d)	The U.S. economy; the world economy

Question 5 (5 points)

Saved

Which of the following is NOT an example of asymmetric information?

Question 5 options:

	Characteristics of a perfectly competitive market
	Treatment options for patients under a doctor's care
	Quality of pharmaceutical drugs
	Adverse selection when purchasing insurance

Question 6 (5 points)

Saved

Which of the following statements is INCORRECT regarding "economies of scale"

Question 6 options:

	A large factory can produce at a lower Average Cost a than a smaller factory
	Refers to the output produced
	Multiproduct organizations have lower Average Cost
	A long-run curve because all factors of production are variable in the long-run

Question 7 (5 points)

Saved

When lower risk individuals opt-out of health insurance coverage and higher-risk individuals choose to purchase insurance, what is this called?

Question 7 options:

	Adverse selection
	Expected value
	Pre-existing condition
	Moral Hazard

Question 8 (5 points)

Saved

Which of the following is an INCORRECT statement regarding "substitute" goods?

Question 8 options:

a)	A "substitute" is a good used in lieu of another good that functions similarly or provides the same service.

b)	An increase in the price of the substitute good, reduces the demand for the good you are focusing on.

c)	Demand for a product will bemore sensitive to price changesif there are a large number of substitutes for the product.

d)	The availability of a "substitute" for a good impacts the price sensitivity or elasticity of the good.

Question 9 (5 points)

Saved

Which of the following is a FALSE statement regarding adverse selection?

Question 9 options:

	The smaller the covered population, the lower the impact of adverse selection on premiums.
	Insurers in the individual market used medical underwriting to mitigate adverse selection.
	Community rating is a method insurers use to mitigate adverse selection
	Adverse selection arises because of "asymmetric information"

Question 10 (5 points)

Saved

Which of the following is a CORRECT statement regarding the marginal principal?

Question 10 options:

	Continue an activity as long as the total benefit equals the total cost
	Continue an activity as long as the benefit exceeds the cost
	Continue an activity as long as the marginal benefit exceeds the marginal cost
	Continue an activity as long as the marginal benefit equals the marginal cost

Question 11 (5 points)

Saved

What does the demand curve for health care services look like when someone has health insurance coverage?

Question 11 options:

	It is elastic and downward sloping.
	Inelastic and downward sloping
	It is elastic and upward sloping.
	It is flat.

Question 12 (5 points)

Saved

You have a part-time job at the library that pays $15 per hour, 3 hours per day on Saturdays and Sundays. Some friends want you to join them on a weekend ski trip leaving Friday night and returning Monday morning. They estimate your share of the gas, motel, lift tickets, and other expenses to be around $30. What is your opportunity cost of taking the ski trip?

Question 12 options:

	$60
	$30
	$90
	$120

Question 13 (5 points)

Saved

Economists refer to the relationship that a higher price leads to a lower quantity demand as the

Question 13 options:

	Market equilibrium
	Law of Demand
	Economic Model of Pricing
	Income gap

Question 14 (5 points)

Saved

Which of the following is not an element of the economic way of thinking?

Question 14 options:

a)	Rational people respond to rational incentives

b)	Use assumptions to simplify complex behavior

c)	Use normative statements

d)	Thinking at the margin

Question 15 (5 points)

Saved

Which of the following would reduce the supply of MRI machines?

Question 15 options:

	An increase in the price of MRI's
	A reduction in the price of computer chips used to produce MRI's
	A technological improvement that lowers the cost of producing the MRI machines
	Higher wage rates for the workers that assemble the MRI;s

Question 16 (5 points)

Saved

Economists refer to this pattern, the_________________, which means that as a person receives more of a good, the additional or marginal utility from each additional unit consumed declined

Question 16 options:

	Law of Increasing Marginal Utility
	Production Possibility Frontier
	Law of Diminishing Marginal Utility
	Law of Trade-offs

Question 17 (5 points)

Saved

Economics is the Study of __________

Question 17 options:

a)	Human behavior under stressful situations

b)	The interaction of people in social situations

c)	Scarcity of resources or goods

d)	Biological systems in the environment

Question 18 (5 points)

Saved

Which of the following correctly identifies the price at which a firm should shut-down?

Question 18 options:

	Price is equal to marginal cost
	Price is equal to the average variable cost
	Price is less than average variable cost
	Price is less than total cost

Question 19 (5 points)

Saved

Which of the following will lead to a DECREASE in the demand for health insurance?

Question 19 options:

a)	An increase in the expected value of an event occurring

b)	An increase in income

c)	An increase in premiums

d)	An increase in risk aversion

Question 20 (5 points)

Saved

If the demand for bandages is relatively elastic, a 10 percent decline in the price of bandages will:

Question 20 options:

a)	Increase the amount demanded by more than 10 percent

b)	Decrease the amount demanded by more than 10 percent

c)	Decrease the amount demanded by less than 10 percent

d)	Increase the amount demanded by less than 10 percent