ECON HW1
Homework 1
Question 1
1. Managerial economics is best defined as the economic study of how business can B. decide on the best use of scarce resources.
Question 2
1. Which of the following statements best illustrates the use of the market process in determining the allocation of scarce resources? A.
"We should consider shifting to products where we can earn more money."
Question 3
1. One key question from the "One lession of business" might be A. should the firm be in the business in which it is operating.
Question 4
1. Opportunity cost is best defined as D. the amount given up when choosing one activity over the next best alternative.
Question 5
1. Which of the following is the best example of opportunity cost?
Question 6
1. Transactions costs include D. all of the above
Question 7
1. The best example of an economic goal of a firm is A. increasing employee morale. B. increasing shareholder wealth. C. improving its public image. D. providing good products/services to its customers.
Question 8
1. Which of the following is most likely a fixed cost? A. property taxes B. expenditures for raw materials C. fuel cost D. wages for unskilled labor
Question 9
1. Costs of production that change with the rate of output are A. opportunity costs B. fixed costs C. variable costs D. sunk costs
Question 10
1. Which of the following distinctions helps to explain the difference between relevant and irrelevant cost? A. variable versus incremental cost B. accounting cost vs. direct cost C. historical cost vs. replacement cost D. sunk cost vs. fixed cost
Question 11
1. Economists consider which of the following costs to be irrelevant to a short-run business decision? A. out-of-pocket cost B. opportunity cost C. historical cost D. replacement cost
Question 12
1. To an economist, total costs include A. implicit, but not explicit costs B. explicit, but not implicit costs C. explicit and implicit costs D.
Question 1
1. Managerial economics is best defined as the economic study of how business can B. decide on the best use of scarce resources.
Question 2
1. Which of the following statements best illustrates the use of the market process in determining the allocation of scarce resources? A.
"We should consider shifting to products where we can earn more money."
Question 3
1. One key question from the "One lession of business" might be A. should the firm be in the business in which it is operating.
Question 4
1. Opportunity cost is best defined as D. the amount given up when choosing one activity over the next best alternative.
Question 5
1. Which of the following is the best example of opportunity cost?
Question 6
1. Transactions costs include D. all of the above
Question 7
1. The best example of an economic goal of a firm is A. increasing employee morale. B. increasing shareholder wealth. C. improving its public image. D. providing good products/services to its customers.
Question 8
1. Which of the following is most likely a fixed cost? A. property taxes B. expenditures for raw materials C. fuel cost D. wages for unskilled labor
Question 9
1. Costs of production that change with the rate of output are A. opportunity costs B. fixed costs C. variable costs D. sunk costs
Question 10
1. Which of the following distinctions helps to explain the difference between relevant and irrelevant cost? A. variable versus incremental cost B. accounting cost vs. direct cost C. historical cost vs. replacement cost D. sunk cost vs. fixed cost
Question 11
1. Economists consider which of the following costs to be irrelevant to a short-run business decision? A. out-of-pocket cost B. opportunity cost C. historical cost D. replacement cost
Question 12
1. To an economist, total costs include A. implicit, but not explicit costs B. explicit, but not implicit costs C. explicit and implicit costs D.