Question : 31) Political candidates often hold fund raisers by charging “per : 1387263

31) Political candidates often hold fund raisers by charging “per plate” for dinner. Wendy purchased four tickets to a $1,000 per plate dinner for a local city council candidate. Is this transaction economically efficient?

A) No, political candidates should never be allowed to overcharge for a fund raising dinner.

B) Yes, it was a voluntary exchange that benefited both parties.

C) No, Wendy paid too much for four dinners.

D) Yes, it is efficient only from the perspective of the candidate but not from the perspective of Wendy.

32) In economics, the term “equity” means

A) everyone has an equal standard of living.

B) the hardest working individuals consume all they want.

C) only elected officials have high standards of living.

D) economic benefits are distributed fairly.

33) Which of the following is motivated by an equity concern?

A) Some states have transferred funds to food bank programs in order to increase benefits to lower-income families.

B) Following the implementation of subsidies for energy conservation, household demand for rooftop solar panels increased quite significantly in California.

C) The United Network for Organ Sharing advocates a system of rationing scarce kidneys that would favor young patients over old in an effort to wring more life out of donated organs.

D) The United States offers patent protection to pharmaceutical manufacturers to prevent others from duplicating their products.

34) Which of the following is motivated by an efficiency concern?

A) In December 2006, the Bush administration restarted a short-term housing assistance program for victims of Hurricane Katrina.

B) Each year, the University of Notre Dame conducts a lottery to parcel out the 30,000 seats available to contributors, former athletes and parents in the 80,000-seat stadium.

C) The United Network for Organ Sharing advocates a system of rationing scarce kidneys that would favor young patients over old in an effort to wring more life out of donated organs.

D) The federal government’s housing choice voucher program assists very low-income families, the elderly, and the disabled to afford decent, safe, and sanitary housing in the private market.

35) Which of the following is an example of an efficiency-equity trade-off faced by economic agents?

A) According to an article by in the American Journal of Public Health by Edward Kaplan and Michael Merson of Yale University School of Medicine, the federal government’s current method of allocating HIV-prevention resources is not cost-effective. Instead of allocating resources to states in proportion to reported AIDS cases, resources should flow first to those activities that prevent more infections per dollar and then to less and less effective combinations of programs and populations until funds are exhausted, even if it means that some populations would be left without any prevention services.

B) Concerned about the falling birth rate, the French government has pledged more money for families with three children, in an effort to encourage working women to have more babies.

C) Some U.S. colleges are actively recruiting foreign students for their technology-based programs.

D) All New York City art museums are considering adopting a free-admission policy for local residents one weekend per month.

36) Which of the following correctly describes the relationship between economic efficiency and economic equity?

A) They are both automatically achieved in a free market economy.

B) They always call for opposite outcomes.

C) There is no conflict between the two goals.

D) There is often a trade-off between the two.

37) Allocative efficiency best explains ________, and productive efficiency best explains ________.

A) how something will be produced; when something will be produced

B) when something will be produced; why something will be produced

C) why something will be produced; what will be produced

D) what will be produced; how something will be produced

38) Trina’s Tropical Fish Store sells goldfish for $2 each and angelfish for $10 each. What is the opportunity cost of buying a goldfish?

A) 5 angelfish

B) 1/5 of an angelfish

C) $10

D) $2

39) Trinh quits his $80,000-a-year job to become a full-time volunteer at a museum. What is the opportunity cost of his decision?

A) 0 since he will no longer be earning a salary

B) depends on the “going rate” of museum employees

C) at least $80,000

D) the value he attributes to the joy of working at a museum

40) Jewelry manufacturers produce a range of products such as rings, necklaces, bracelets, and brooches. What fundamental economic question are they addressing by offering this range of items?

A) How to produce goods that consumers want?

B) Why produce a variety of items?

C) What to produce?

D) Who to produce the items for?