Logic of Choice: Sample Quiz

Choose the most correct answer. Either click on a button or enter your answer in the box to the left of the question. When you have answered them all, click the Check-My-Answers button and you will see how well you know this material.

1. Which of the following will shift a production-possibilities frontier to the right?

Wants become greater.
 Either resources increase or technology improves.
 Unemployment and underemployment are eliminated.
 People demand more of one good and less of the other.
 Opportunity costs rise.

Below is a table giving information about the costs and benefits of an activity. Answer the next three questions using this table.

Amount
Total Cost
Marginal Benefits
1 (first)
8
18
2 (second)
16
14
3 (third)
25
8
4 (fourth)
36
7
5 (fifth)
50
3

2. The total benefit of three units is:

9. 24. 30. 40.

3. The marginal cost of the fourth unit is:

7. 9. 11. 36.

4. At which amount of the activity are net benefits the greatest?

1 2 3 4 5

5. When benefits are at their maximum,

total cost equals total benefits.
 the slope of the marginal cost curve equals the slope of the marginal benefit curve.
 Average cost equals average benefit.
 The difference between total benefit and total cost is at its largest.

6. How do economists theorize about the goals which people have?

They simply assume goals exist.
 They are mostly concerned whether or not the goals people have are good goals.
 They use utility theory to explain goal formation.
 They explain the formation of goals in terms of people's environment.

7. The line that separates those things that are affordable from those that are not is called the:

total cost curve.
 total benefit curve.
 total utility curve.
 budget constraint.

Return to Back to Overview Table of Contents

 

Copyright Robert Schenk