answer all questions with typing in the computer please PRACTICE EXERCISE-OPPORT
ID: 1134047 • Letter: A
Question
answer all questions with typing in the computer please
PRACTICE EXERCISE-OPPORTUNITY COST & MARGINAL ANALYSIS Indicate whether each of the following statements applies to microeconomics or macroeconomics: a. The unemployment rate in the United States was 8.1 percent in August 2012 b. A U.S. software firm discharged 15 workers last month and transferred the work to India. c. An unexpected freeze in central Florida reduced the citrus crop and caused the price of oranges to rise. U.S. output, adjusted for inflation, decreased by 2.4 percent in 2009 Last week Wells Fargo Bank lowered its interest rate on business loans by one-half of 1 percentage point. d. e. f. The consumer price index rose by 3.8 percent from August 201 to August 2012. 2. Suppose that you initially have $100 to spend on books or movie tickets. The books start off costing $25 each and the movie tickets start off costing $10 each. For each of the following situations, would the attainable set of combinations that you can afford increase or decrease? Your budget increases from $100 to $150 while the prices stay the same. Your budget remains S100, the price of books remains $25, but the price of movie tickets rises to S20 Your budget remains S100, the price of movie tickets remains $10, but the price of a book falls to a. b. c. Suppose that you are given a $100 budget at work that can be spent only on two items: staplers and pens. If staplers cost S10 each and pens cost S2.50 each, then the opportunity cost of purchasing one stapler is a. 10 pens pens. c. zero pens. d. 4 pens 4. For each of the following situations involving marginal cost (MC) and marginal benefit (MB) a. c, e, 5. indicate whether it would be best to produce more, fewer, or the current number of units. 3,000 units at which MC $10 and MB = $13. b. 1 1 units at which MC = $4 and MB $3. 43,277 units at which MC-$99 and MB $99, d. 82 units at which MCExplanation / Answer
1. a) Macroeconomics
It is the study of economic relations and economics problems at the level of economy as a whole. Unemployment, inflation, are macroeconomic concepts.
b) Microeconomics
It is the study of economic relations and economic problems at the level of individual. Given statement talks about one firm in the U.S.
c) Macroeconomics
d) Macroeconomics
Real GDP or nominal GDP are concepts of macroeconomics.
e) Macroeconomics
Change in interest rate by bank is a macro concept.
f) Macroeconomics
Price index is the macroeconomics concept.
2. a) Attainable set of combination increases because income of people increases.
b) Increase in the price of movie tickets decreases disposable income which leads to decrease in attainable set of combination.
c) Increase in the attainable set of combination because decrease in the price of a book increases disposable income of consumer which leads to increase in consumption.
3. When complete income is spent on staplers then total staplers that can be purchased = 100/10 = 10
Maximum amount of pens that can be purchased = 100/2.50 = 40
10 staplers = 40 pens
1 stapler = 40/10 = 4 pens
Opportunity cost of 1 stapler is 4 pens.
d) 4 pens is the answer.
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