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EAE110 - Fundamentos de Microeconomia
Gabarito da lista 1 (caps. 1-4 Frank & Bernanke)
Professor: David Turchick
CAPÍTULO 1
11. The scarcity principle applies to
A. all decisions.
B. only market decisions, e.g., buying a car.
C. only non-market decisions, e.g., watching a sunset.
D. only the poor.
17. Choosing to study for an exam until the extra benefit (improved score) equals the extra cost (mental fatigue) is
A. not rational.
B. an application of the cost-benefit principle.
C. an application of the scarcity principle.
D. the relevant opportunity cost.
Larry was accepted at three different graduate schools, and must choose one. Elite U costs $50,000 per year and did not
offer Larry any financial aid. Larry values attending Elite U at $60,000 per year. State College costs $30,000 per year,
and offered Larry an annual $10,000 scholarship. Larry values attending State College at $40,000 per year. NoName U
costs $20,000 per year, and offered Larry a full $20,000 annual scholarship. Larry values attending NoName at $15,000
per year.
24. The opportunity cost of attending Elite U is
A. $50,000
B. $10,000
C. $20,000
D. $15,000
25. The opportunity cost of attending State College is
A. $30,000
B. $20,000
C. $15,000
D. $10,000
26. Larry maximizes his surplus by attending
A. Elite U, because $60,000 is greater than the benefit at the other schools.
B. State College, because the difference between the benefit and cost is greatest there.
C. NoName U, because Larry has a full scholarship there.
D. Elite U, because the opportunity costs of attending Elite U are the lowest.
55. Pat earns $25,000 per year (after taxes), and Pat's spouse, Chris, earns $35,000 (after taxes). They have two preschool children. Childcare for their children costs $12,000 per year. Pat has decided to stay home and take care of the
children. Pat must
A. value spending time with the children by more than $25,000.
B. value spending time with the children by more than $12,000.
C. value spending time with the children by more than $13,000.
D. value spending time with the children as much than does Chris.
Matt has decided to purchase his textbooks for the semester. His options are to purchase the books via the Internet with
next day delivery to his home at a cost of $175, or to drive to campus tomorrow to buy the books at the university
bookstore at a cost of $170. Last week he drove to campus to buy a concert ticket because they offered 25 percent off
the regular price of $16.
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60. Matt's benefit of buying his books at the bookstore is _____.
A. $5
B. $9
C. $170
D. $175
61. Matt's benefit was ____ from driving to campus to buy the concert ticket last week.
A. $2
B. $4
C. $9
D. $16
62. According to the cost-benefit principle:
A. it would not be rational for Matt to drive to campus to purchase the books because the $5 saving is only two percent
of the cost of the books, and that is much less than the 25 percent he saved on the concert ticket.
B. it would be rational for Matt to drive to campus because it costs less to buy the books there than via the Internet.
C. it would be rational for Matt to drive to campus because the $5 saving is more than he saved by driving there to buy
the concert ticket.
D. it would not be rational for Matt to drive to campus to purchase the books because the cost of gas and his time must
certainly be more than the $5 he would save.
63. Assume the minimum that Matt would be willing to accept to drive to the university campus is equal to the amount
he saved on the concert ticket. What would be the amount of his economic surplus if he bought his textbooks at the
university bookstore rather than via the Internet?
A. $5
B. $1
C. $50
D. $20
95. Tony notes that an electronics store is offering a flat $20 off all prices in the store. Tony reasons that if he wants to
buy something with a price of $50 that it is a good offer, but if he wants to buy something with a price of $500 it is not a
good offer. This is an example of
A. inconsistent reasoning; saving $20 is saving $20.
B. the proper application of the cost-benefit principle.
C. rational choice because in the first case he saves 40% and in the second case he saves 4%.
D. marginal cost equals marginal benefit thinking.
IBM employs Pam to assemble personal computers. Pam can assemble 1 computer if she works 1 hour, 4 computers in
2 hours, 8 computers in 3 hours, 10 computers in 4 hours, and 11 computers in 5 hours. Each computer consists of a
motherboard that costs $200, a hard drive that costs $100, a case that costs $20, a monitor that costs $200, a keyboard at
$60 and a mouse that costs $20. The cost of employing Pam is $40 per hour.
97. What is the marginal cost of producing the computers Pam assembles during her 3rd hour of work?
A. $1,200
B. $1,240
C. $2,400
D. $2,440
100. IBM sells each computer for $640. How many hours should IBM employ Pam to maximize its benefit from her
employment?
A. 2 hours
B. 3 hours
C. 4 hours
D. 5 hours
108. Jack has a ticket to see Bo Bice for which he paid $30 yesterday. He takes an unpaid day off from work to get
ready for the concert. When he arrives at the concert, 5 different people offer him $70 for his ticket. The cost to Jack of
seeing Bo Bice is
A. $30.
B. $40.
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C. $70.
D. $70 plus his forgone earnings.
139. One thing that distinguishes normative principles from positive principles is that
A. normative principles are pessimistic and positive principles are optimistic.
B. normative principles reflect the social norms of the community, and positive principles reflect universal truths.
C. normative principles tell us how people should make economic decisions, and positive principles tell us how people
actually do make decisions.
D. normative principles tell us how people actually make economic decisions, and positive principles tell us how people
should make decisions.
CAPÍTULO 2
5. Having a comparative advantage in a particular task means that
A. you are better at it than other people.
B. you give up more to accomplish that task than do others.
C. you give up less to accomplish that task than do others.
D. you have specialized in that task, while others have not.
35. The production possibilities curve shows
A. the minimum production of one good for every possible production level of the other good.
B. how increasing the inputs used for one good increases the production of the other good.
C. the maximum production of one good for every possible production level of the other good.
D. how increasing the production of one good allows production of the other good to also rise.
49. Refer to the figure above. For Pat, the opportunity cost of removing one bag of trash is
A. 25 bulbs not planted.
B. 5 bulbs not planted.
C. 10 bulbs not planted.
D. one-fifth of a bulb not planted.
50. Refer to the figure above. For Chris, the opportunity to removing one bag of trash is
A. 25 bulbs that don't get planted.
B. 5 bulbs that don't get planted.
C. 3 bulbs that don't get planted.
D. One-third of a bulb that doesn't get planted.
51. Refer to the figure above. If Pat and Chris were to specialize in the task for which each has a comparative
advantage,
A. Chris would plant bulbs and Pat would haul out trash.
B. Chris would haul out trash and Pat would plant bulbs.
C. Pat and Chris would each spend one hour on each task.
D. both would plant bulbs as they both have an absolute advantage in that task.
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54. An inefficient point is
A. necessarily an attainable point.
B. not necessarily attainable.
C. necessarily an unattainable point.
D. possibly an unattainable point.
55. Refer to the figure above. It is __________ for this farmer to grow 1,000 bushels of wheat and no corn relative to
growing 500 bushels of corn and no wheat.
A. not efficient
B. more efficient
C. less efficient
D. equally efficient
Smith and Jones comprise a two-person economy. Their hourly rates of production are shown below.
80. The opportunity cost of making an extra calculator for Smith is __________ and for Jones it is __________.
A. 0.10 computers; 0.05 computers
B. 10 computers; 6 computers
C. 1 computer; 0.5 computers
D. 0.6 computers; 1.2 computers
83. Suppose Smith and Jones begin at the point of 0 computers and 220 calculators. If they wish to have 2 computers
and 200 calculators, then Smith will spend __________ and Jones will spend __________.
A. 30 minutes on each; 30 minutes on each
B. 48 minutes on computers and 12 minutes on calculators; 1 hour on calculators
C. 1 hour on calculators; 10 minutes on computers and 50 minutes on calculators
D. 12 minutes on computers and 48 minutes on calculators; 1 hour on calculators
84. For any efficient point with more than 10 computers and fewer than 120 calculators, Smith will __________ and
Jones will __________.
A. only produce computers; only produce calculators
B. only produce computers; split his time between computers and calculators
C. split his time between computers and calculators; only produce computers
D. only produce calculators; only produce computers
86. As Smith and Jones choose to efficiently produce fewer computers and more calculators, __________ devotes more
time to calculators because his __________.
A. Smith; absolute advantage is larger
B. Jones; absolute advantage is smaller
C. Jones; opportunity costs are lower
D. Smith; opportunity costs are lower
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104. Production Possibilities Curves for large economies generally have an outward bow shape because
A. specialization gives some producers a comparative advantage.
B. opportunity costs tend to decrease with increases in production.
C. opportunity costs tend to increase with increases in production.
D. as more resources are used to produce the same good, those resources become less and less expensive.
105. The Principle of Increasing Opportunity Costs tell us that
A. productive people do the hardest tasks first, while they are fresh.
B. to increase production, you should use the resources with the lowest opportunity cost first.
C. the cost-benefit principle does not apply to increasing productivity.
D. specialization increases productivity.
CAPÍTULO 3
19. As the price of a good rises,
A. firms earn larger profits.
B. more firms can cover their opportunity costs of producing the good.
C. firms find they can raise price by even more.
D. government regulation becomes more justified.
23. A market comprised of a downward sloping demand curve that intersects an upward sloping supply curve is said to
be stable because
A. price will never change.
B. quantity will never change.
C. demand will never change.
D. at any price other than equilibrium, forces in the market move price towards the equilibrium.
28. Whenever the quantity demanded is not equal to the quantity supplied, the quantity that is actually sold in the
market is
A. the quantity demanded.
B. the quantity supplied.
C. the smaller of the quantity demanded and the quantity supplied.
D. the greater of the quantity demanded and the quantity supplied.
34. You notice that your grocery store always has day-old bakery products at a reduced price. Why might that be?
A. At the original price the quantity demanded was greater than the quantity supplied.
B. At the original price, there was a shortage of bakery products.
C. The original price was an equilibrium price because it was established in a free market.
D. At the original price, quantity supplied was greater than quantity demanded.
35. When the price of a good is below its equilibrium value,
A. consumers will bid the price up.
B. excess supply will occur.
C. it will tend to stay below the equilibrium value.
D. suppliers will notice their inventories are growing.
37. In a free market, if the price of a good is above the equilibrium price, then
A. suppliers, dissatisfied with growing inventories, will raise the price.
B. demanders, wanting to ensure they acquire the good, will bid the price lower.
C. government needs to set a lower price.
D. suppliers, dissatisfied with growing inventories, will lower the price.
43. Suppose you notice that more and more people are driving gas-guzzling cars. Since you drive an economy car, their
increased demand for gas:
A. does not affect you.
B. causes companies to charge a lower price, thus benefiting you.
C. causes the price you pay for gas to increase.
D. does not change the price you pay, but reduces the quantity of gas supplied.
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48. Which of the following is not a characteristic of governmental rent controls?
A. Equitable distribution of apartments.
B. Excess demand for apartments.
C. Fewer newly built apartment buildings.
D. Very low vacancy rates.
49. Minimum wage laws are an example of
A. mandated equilibrium wages.
B. a price ceiling.
C. a regulated price.
D. comparative advantage for unskilled workers.
52. In a market where government has set the price below the equilibrium price, one might expect
A. quantity demanded to equal quantity supplied.
B. excess supply.
C. a black market to develop as individuals try to take advantage of unexploited opportunities.
D. quantity supplied to surpass quantity demanded.
55. "As the price of personal computers continues to fall, demand increases." This headline is inaccurate because
A. a change in the price of personal computers shifts the demand curve.
B. a change in the price of personal computers shifts the supply curve.
C. the statement is backwards: increased demand leads to lower prices.
D. falling prices for personal computers increases quantity demanded, not demand.
57. If the demand for a good decreases as income decreases, it is a(n)
A. complementary good.
B. normal good.
C. inferior good.
D. substitute good.
59. In the market for office workers
A. there are no substitutes because each human is unique.
B. computers and desks are complements.
C. an increase in wages will increase the number of workers demanded.
D. a decrease in wages will shift the demand for workers to the left.
60. What might cause a demand function to shift to the right?
A. An increase in the price of a substitute.
B. An increase in the product's own price.
C. An increase in the price of a complement.
D. A decrease in the price of a substitute.
63. Whether or not a good can be classified as a complement depends on whether
A. most people tend to consume the goods together.
B. no substitutes exist
C. an increase in demand for one good follows a decrease in the price of the other.
D. an increase in demand for one good follows an increase in the price of the other.
64. If pizzas are a normal good, then a decrease in the price of pizza will cause a(n)
A. increase in demand.
B. increase in quantity demanded.
C. decrease in quantity demanded.
D. decrease in the number of consumers.
67. As consumers' incomes decrease, the demand curve for bologna sandwiches shifts to the right. Therefore bologna
sandwiches are a(n)
A. normal good.
B. complement good.
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C. substitute good.
D. inferior good.
73. Suppose one observes that when the price of peanut butter increases, the demand for jelly increases. One must
conclude that
A. peanut butter and jelly are complements.
B. peanut butter and jelly are substitutes.
C. peanut butter and jelly are normal goods.
D. peanut butter and jelly are inferior goods.
The supply of Shrek action figures is shown below. The bold, solid line is the current supply.
87. Retailers learn that a new Shrek movie will be released next month. That news is likely to cause
A. no immediate change in supply, but a decrease in the quantity supplied.
B. no immediate change in supply, since the only effect will involve demand.
C. an immediate shift in the supply function to Supply B in anticipation of increased prices.
D. an immediate shift in the supply function to Supply A in anticipation of increased prices.
88. If the price of the plastic used to make action figures rises, supply will
A. shift from Current Supply to Supply B.
B. not change because a change in raw material prices cannot affect market prices.
C. shift from Current Supply to Supply A.
D. remain at Current Supply because Demand for Shrek figures is so strong.
102. An increase in the demand for GM automobiles results in
A. a lower equilibrium price for GM automobiles.
B. an increase in the quantity supplied of GM automobiles.
C. an increase in the supply of GM automobiles.
D. a lower equilibrium quantity of GM automobiles.
104. When supply of a good decreases, consumers respond by
A. decreasing their demand.
B. increasing their preferences for the good.
C. decreasing their quantity demanded.
D. increasing their quantity demanded.
111. One observes that the equilibrium price of a DVD player increases and the equilibrium quantity increases. Which
of the following best fits the observed data?
A. An increase in demand with supply constant
B. An increase in demand coupled with a decrease in supply
C. An increase in demand coupled with an increase in supply
D. A decrease in demand with supply constant
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117. If both supply and demand increase simultaneously, the new equilibrium price is ___________ and the new
equilibrium quantity is _________________.
A. lower; lower
B. lower; indeterminate
C. indeterminate; higher
D. higher; indeterminate
131. An outcome is socially optimal if it
A. follows from a market equilibrium.
B. follows from collective action.
C. leaves no money on the table.
D. maximizes total economic surplus.
139. Suppose that the production of oranges reduces global warming by .1%. The equilibrium price of oranges is
_______ because not all of the _________ are accounted for in the marketplace.
A. too high; benefits
B. too low; benefits
C. too low; costs
D. optimal; costs
144. Which of the following directly follows from the No Cash on the Table principle?
A. In a transaction, the parties will negotiate over prices until neither one earns any surplus.
B. For a transaction to occur, the buyer's reservation price must be greater than the seller's reservation price.
C. For a transaction to occur, the buyer's reservation price must be less than the seller's reservation price.
D. Efficiency requires that the buyer's surplus equal the seller's surplus.
CAPÍTULO 4
6. If the price of textbooks increases by one percent and the quantity demanded falls by one-half percent, then the price
elasticity of demand has a value of
A. 0.05.
B. 0.5.
C. 2.
D. 5.
7. If the price of textbooks increases by one percent and the quantity demanded falls by one-half percent, then demand
for textbooks is
A. negative.
B. price inelastic.
C. price elastic.
D. perfectly inelastic.
8. Price elasticity of demand is often expressed as a positive number because
A. using the formula yields a positive number.
B. demand has a positive slope.
C. it's convenient to use absolute values even though the formula yields non-positive numbers.
D. both the numerator and the denominator in the formula are negative.
21. When the price of NBA ticket is $25 each, 30,000 tickets are sold every game. After increasing the price to $30
each, 20,000 tickets are sold every game. At the original price, the demand for NBA ticket is
A. elastic.
B. inelastic.
C. unitary elastic.
D. perfectly elastic.
23. If consumers respond to a 10% price reduction by buying twice as much, we would conclude that
A. there was excess demand at the original price.
B. there was excess supply at the original price.
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C. the absolute value of price elasticity at the original price was greater than one.
D. the absolute value of price elasticity at the original price was less than one.
35. Jeans in general have fewer close substitutes than any specific brand of jeans. Therefore the demand for jeans would
be _______ than the demand for a specific brand of jeans.
A. more elastic
B. more inelastic
C. more unitary elastic
D. less inelastic
39. Small budget items such as soap have ______ price elasticity of demand compared to big-ticket items such as DVD
players.
A. higher
B. lower
C. very high
D. unitary
47. Economists have found that the price elasticity of demand for water is higher in the summer than in the winter.
Why?
A. Winter is longer than summer, and price elasticity is lower over longer time horizons.
B. Winter is longer than summer, and price elasticity is higher over longer time horizons.
C. Winter water use tends to be for necessities like cleaning and cooking, and summer water use tends to be for both
necessities and non-necessities, like gardening and recreation.
D. People take more vacations in the summer and so use less water at home.
50. If the slope of the demand curve is -1.4, price is $5 and quantity demanded is 13 units, the price elasticity of demand
is
A. 0.27.
B. 0.38.
C. 1.4.
D. 1.8.
61. Refer to the figure above. The slope of the demand curve D1 is _____ and of demand curve D2 is ______.
A. 1/2; 2
B. 2; 1/2
C. 5/4; 4/5
D. 4/5; 5/4
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64. Refer to the figure above. At P = 8 and Q = 4, D1 is ______ elastic than D2, which is shown graphically as D1
being _____ D2.
A. more; flatter than
B. more; steeper than
C. less; flatter than
D. less; steeper than
65. Refer to the figure above. When P = 4, the price elasticity of demand for the demand curve D1 is ______ and D2 is
_____.
A. 3; 3
B. 2/3; 1/3
C. 1/3; 3
D. 1/3; 2/3
76. If consumers completely cease purchasing a product when its price increases by any amount, demand is classified
as
A. elastic.
B. perfectly inelastic.
C. unitary elastic.
D. perfectly elastic.
82. A demand curve that is drawn as a vertical line illustrates price elasticity equal to
A. 0.
B. 1.
C. infinity.
D. the quantity.
103. When Taylor raised the price of earrings at Taylor's Boutique, total revenue from earrings increased. This suggests
that
A. the demand for Taylor's earrings at the original price must be elastic.
B. there are too many other boutiques competing with Taylor.
C. there was excess demand for earrings at the original price.
D. the demand for Taylor's earrings at the original price was inelastic.
108. Chris had been charging a dollar a pound for potatoes. When Chris lowered the price to 90 cents, total revenue fell.
When Chris raised the price to $1.10, total revenue also fell. Why?
A. $1.00 is the equilibrium price for potatoes.
B. At 90 cents, there is excess demand for potatoes.
C. $1.10 is more than Chris's customers' reservation prices.
D. Price elasticity of demand is unitary at $1.00.
112. If cross price elasticity is positive but less than one, the two goods are
A. substitutes.
B. inelastically demanded.
C. complements.
D. normal.
114. When the price of lettuce rises, the demand for salad dressing _______ because these two goods are complements.
A. increases
B. decreases
C. remains the same
D. becomes more inelastic
116. Elvis loves to eat peanut butter with bananas. Martha thinks the combination of peanut butter and bananas is
repulsive. Therefore, economists would classify peanut butter and bananas as
A. complements for Elvis, but not for Martha
B. complements only if their cross-price elasticity is negative.
C. complements only if their cross-price elasticity is positive.
D. unrelated because whether or not they are complements depends on individual tastes.
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122. In surveying their alumni, State U's economics department discovered that ramen noodle consumption declined as
soon as students graduated and found jobs. One conclusion the survey team might draw from this result is that
A. there is excess demand for ramen noodles.
B. the equilibrium price for ramen noodles is too high.
C. college graduates have a high reservation price for ramen noodles.
D. ramen noodles are an inferior good.
132. An increase in the price of golf clubs from $75 to $125 led to an increase in quantity supplied from 200 units to
300 units. The price elasticity of supply for golf club is _____ so the supply curve is _______.
A. 2; elastic
B. 2; inelastic
C. 4/3; elastic
D. 3/4; inelastic
138. Refer to the figure above. What is the price elasticity of supply when P = 6?
A. less than zero
B. positive, but less than one
C. 1
D. greater than 1
139. Refer to the figure above. If the price changes from $10 to $14, what happens to the elasticity?
A. It will increase.
B. It will decline.
C. It will stay the same.
D. It will first decline then increase.
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