MACROECONOMICS (LL)
21st Edition
ISBN: 9781260186949
Author: McConnell
Publisher: MCG
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Chapter 1, Problem 4RQ
To determine
The opportunity cost of buying a stapler.
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Suppose that you are given a $100 budget at work that can be spent only on two items: staplers and pens. If staplers cost $10 each and pens cost $2.50 each, then the opportunity cost of purchasing one stapler is: a. 10 pens. b. 5 pens. c. zero pens. d. 4 pens.
How does the slope of a budget line illustrate opportunity costs and trade-offs? How does a budget line illustrate scarcity and the effect of limited incomes?
Suppose the economy initially produces 9,000 pieces of clothing and 500 million barrels of oil, which is represented by point A. The opportunity cost of producing an additional 3,000 pieces of clothing (that is, moving production to point B) is __________ (options: 60 million, 80 million, 100 million, 120 million, 150 million) barrels of oil.
Suppose, instead, that the economy currently produces 420 million barrels of oil and 12,000 pieces of clothing, which is represented by point B. Now the opportunity cost of producing an additional 3,000 pieces of clothing (that is, moving to point C) is ________ (options: 60 million, 80 million, 100 million, 120 million, 150 million) barrels of oil.
Comparing your answers in the two previous paragraphs, you can see that the opportunity cost of 3,000 additional pieces of clothing at point B is ________ (opptions: greater than, equal to, less than) the opportunity cost of 3,000 additional pieces of clothing at point A. This reflects the ______…
Chapter 1 Solutions
MACROECONOMICS (LL)
Ch. 1.2 - Prob. 1QQCh. 1.2 - Prob. 2QQCh. 1.2 - Prob. 3QQCh. 1.2 - Prob. 4QQCh. 1.A - Briefly explain the use of graphs as a way to...Ch. 1.A - Prob. 2ADQCh. 1.A - Prob. 3ADQCh. 1.A - Prob. 1ARQCh. 1.A - Prob. 2RQCh. 1.A - Prob. 2ARQ
Ch. 1.A - Prob. 1APCh. 1.A - Prob. 2APCh. 1.A - Prob. 3APCh. 1.A - Prob. 4APCh. 1.A - Prob. 5APCh. 1.A - Prob. 6APCh. 1.A - Prob. 7PCh. 1.A - Prob. 7APCh. 1.A - Prob. 8PCh. 1.A - Prob. 8APCh. 1 - Prob. 1DQCh. 1 - Prob. 2DQCh. 1 - Prob. 3DQCh. 1 - Prob. 4DQCh. 1 - Prob. 5DQCh. 1 - Prob. 6DQCh. 1 - Prob. 7DQCh. 1 - Prob. 8DQCh. 1 - Prob. 9DQCh. 1 - Prob. 10DQCh. 1 - Prob. 11DQCh. 1 - Prob. 1RQCh. 1 - Prob. 2RQCh. 1 - Prob. 3RQCh. 1 - Prob. 4RQCh. 1 - Prob. 5RQCh. 1 - Prob. 6RQCh. 1 - Prob. 7RQCh. 1 - Prob. 1PCh. 1 - Prob. 2PCh. 1 - Prob. 3PCh. 1 - Prob. 4PCh. 1 - Prob. 5PCh. 1 - Prob. 6PCh. 1 - Prob. 7PCh. 1 - Prob. 8P
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- Logically relate the concepts – Choice, Scarcity, and Opportunity Cost while explaining each concept.arrow_forwardDraw a production possibilities curve for food and clothing. If you are operating on the curve, what is the opportunity cost of producing more clothing? If you are on the curve, is it possible to increase production of one good without decreasing the production of the other?arrow_forwardLike a good economist, you calculated the cost of getting your college degree, including the opportunity cost. Suppose that at your university, you will pay $15,000 each year for tuition, $3,000 each year for textbooks, and $8,000 per year for room and board. Before you left for college, your boss at your high-school job offered you a job paying $15,000 per year.Assume that if you decided not to go to college, your parents would let you live at home for free.Including the opportunity cost, what is the cost of attending four years of college? $arrow_forward
- Below is a production possibilities table for consumer goods (automobiles) and capital goods (forklifts): If the economy is at point C , what is the cost of one more automobile? Of one more forklift? Explain how the production possibilities curve reflects the law of increasing opportunity costs.arrow_forwarda. Would the study of economics be necessary if resources were unlimited? b. "Wants are not limitless. This can be proven. I get all the breakfast I want every morning." Explain. c. You are invited to go to the movies this weekend as a gift for your birthday. Explain whether or not this gift is free. d. List two opportunity costs a law student may incur in order attend law school. Do you think two different students will incur the same opportunity costs? Explain.arrow_forwardMarie has a weekly budget of $24. Pie's are $12 each. Magazines are $4 each. What is Marie's opportunity cost of purchasing a pie?arrow_forward
- In the first graph with hats and videos are opportunity costs constant or increase? How much does it cost him to make the first video in terms of hats? This is a movement from A to B. How about the last video? This is a movement from D to E.arrow_forwardHow Many Pints of Blackberries? The pleasure you get from each pint of freshly picked blackberries is $2.00. It takes you 12 minutes to pick the first pint, and each additional pint takes an additional 2 minutes (14 minutes for the second pint, 16 minutes for the third pint, and so on). The opportunity cost of your time is $0.10 per minute. a. How many pints of blackberries should you pick? Illustrate with a complete graph. b. How would your answer to (a) change if your pleasure decreased by $0.20 for each additional pint ($1.80 for the second, $1.60 for the third, and so on)? Illustrate with a complete graph.arrow_forwardLike a good economist, you calculated the opportunity cost of getting your college degree. Suppose that at your university, you will pay $15,000 each year for tuition, $3,000 each year for textbooks, and $8,000 per year for room and board. Before you left for college, your boss at your high-school job offered you a job paying $15,000 per year.Assume that if you decided not to go to college, your parents would not let you live at home.What is your opportunity cost for four years of college? $____arrow_forward
- Suppose Alphonso’s town raised the price of bus tickets to $1 per trip (while the price of burgers stayed at $2 and his budget remained $10 per week.). What happens to the opportunity costarrow_forwardUse the following table to answer the question below. Dave's Production Possibilities Schedule Simon's Production Possibilities Schedule Pounds of Green Beans Pounds of Corn Pounds of Green Beans Pounds of Corn 0 160 0 80 20 120 40 60 40 80 80 40 60 40 120 20 80 0 160 0 Dave's opportunity cost of producing 1 pound of corn is ______ pound(s) of green beans. Simon's opportunity cost of producing 1 pound of corn is ______ pound(s) of green beans. Multiple Choice 1, 2 2, 1/2 1/2, 2 2, 1arrow_forwardWhich one is false? Explain why that is false. 1. The production possibilities curve is a simple device for summarizing the possible combinations of output that a society can produce if it employs its resources efficiently. 2. One person has a comparative advantage over another in the production of a good if she or he can produce more of that good than the other person. 3. The Cost-Benefit Principle says that a person should take an action if, and only if, the benefit of that action is at least as great as its cost. 4. Market equilibrium occurs when the quantity buyers demand at the market price is exactly the same as the quantity that sellers offer. Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for surearrow_forward
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