Q: Which equation correctly calculates the annual opportunity cost of spending 1 hour per day on social media, if your time is valued at $13 per hour?

$$1 \times 365 \times 13 = 4,745$$

Question 1

Which of the following best describes the first principle of economics?

Accepted Answer

People try to optimize by choosing the best available option given their information.

Question 2

Suppose you spend 2 hours watching a movie instead of working, and your wage is $10 per hour. What is the opportunity cost of watching the movie?

Accepted Answer

$20

Question 3

Which equation correctly calculates the annual opportunity cost of spending 1 hour per day on social media, if your time is valued at $13 per hour?

Accepted Answer

$$1 	imes 365 	imes 13 = 4,745$$

Question 4

Which of the following is NOT an example of an economic agent?

Accepted Answer

A rock

Question 5

What does it mean if a resource is 'scarce'?

Accepted Answer

The quantity people want often exceeds the quantity available.

Question 6

Which principle of economics is illustrated when economists use data to test theories?

Accepted Answer

Empiricism

Question 7

A situation in which no individual can benefit by changing their own behavior is called:

Accepted Answer

Equilibrium

Question 8

Which of the following best describes a 'free rider' problem?

Accepted Answer

When an individual enjoys the benefits of a situation without incurring the costs.

Question 9

If you drive 3 miles to buy a $$20 item for 10$$, what is the opportunity cost of your decision?

Accepted Answer

The value of your time and resources spent driving, plus any alternative uses of that time.

Question 10

Which of the following statements is normative economics?

Accepted Answer

"One student should just take one candy so that everyone gets a piece."

Question 11

Which concept is defined as the best alternative use of a resource?

Accepted Answer

Opportunity cost

Question 12

Microeconomics is primarily concerned with:

Accepted Answer

How individuals, firms, and governments make choices.

Question 13

Which of the following is a positive economic statement?

Accepted Answer

"The unemployment rate is 5%."

Question 14

If a person faces a budget constraint, what does this mean?

Accepted Answer

They must choose among options without exceeding their available resources.

Question 15

Which of the following is an example of empiricism in economics?

Accepted Answer

Using data to determine if optimization matches actual human behavior.

Question 16

Suppose you are deciding whether to spend an hour on TikTok or work for $15/hour. What is the opportunity cost of spending the hour on TikTok?

Accepted Answer

$15

Question 17

Which of the following best describes the difference between microeconomics and macroeconomics?

Accepted Answer

Microeconomics studies individual choices; macroeconomics studies the whole economy.

Question 18

Which of the following is NOT a principle of economics described in Chapter 1?

Accepted Answer

Scarcity

Question 19

If a group is not in equilibrium, what does this imply?

Accepted Answer

At least one person could benefit by changing their behavior.

Question 20

Which formula would you use to calculate the opportunity cost of spending $$x$$ hours per day on an activity, if your time is valued at $$w$$ dollars per hour over $$d$$ days?

Accepted Answer

$$x 	imes d 	imes w$$

Chapter 1: The Principles and Practice of Microeconomics

Study Guide - Practice Questions

Study Guide - Flashcards