Question : 11) Ali decides to attend the one-hour review session for : 1240400

11) Ali decides to attend the one-hour review session for microeconomics instead of working at his job. His job pays him $10 per hour. Ali’s opportunity cost of attending the review session is

A) the $10 he could have earned at his job.

B) the value of the session minus the $10 he could have earned at his job.

C) nothing, because the review session does not cost anything.

D) equal to the benefit he gets from the review session.

E) the one-hour review session.

12) Suppose that, instead of taking this test, you could either have worked and earned income or partied and had a pleasurable time. Your opportunity cost of taking the test is the

A) forgone work.

B) forgone party.

C) forgone working and partying.

D) forgone working or partying, depending on which was your next best choice.

E) test because you are taking it.

13) The benefit from a good or service that you purchase is measured by

A) the dollar amount that is paid for the good or service.

B) the dollar amount you can get by selling the good or service.

C) what you are willing to give up to obtain the good or service.

D) how strong the incentives were that lead to buying the good or service.

E) None of the above answers is correct because there is no way to measure the benefit you receive from purchasing a good or service.

14) Suppose you take a trip during spring break. To determine the benefit of taking the trip, you

A) calculate the opportunity cost of the trip.

B) measure what you are willing to give up to take the trip.

C) determine the sunk cost of taking the trip.

D) calculate the value of the next best alternative foregone.

E) must measure what the trip is worth to you and then subtract the cost of the trip.

15) The cost of a one-unit increase in an activity is called the

A) opportunity benefit.

B) rational cost.

C) marginal cost.

D) marginal benefit.

E) margin.

16) The opportunity cost of a one-unit increase in an activity

A) is greater than the marginal benefit.

B) is called rational cost.

C) decreases as you do more of it.

D) is called marginal cost.

E) is measured by what the person is willing to give up to get one more unit of the activity.

17) Mothers Against Drunk Drivers (MADD) campaigned to increase the legal penalties of drunk driving. This successful campaign ________ of drunk driving.

A) increased the marginal benefit

B) decreased the marginal benefit

C) increased the marginal cost

D) decreased the marginal cost

E) had no effect on the marginal cost or marginal benefit but did affect the total benefit

18) The marginal cost of an activity ________ as you do more of it.

A) increases

B) decreases

C) doesn’t change

D) changes only if the marginal benefit of the activity does not change

E) changes only if the marginal benefit of the activity changes

19) A professor changes the penalty for cheating on exams from getting a 0 on the exam to getting an F in the course. The professor has

A) increased the marginal cost of cheating.

B) decreased the marginal benefit of cheating.

C) made all the students act in the social interest.

D) recognized that students don’t respond to incentives.

E) recognized that students don’t make rational choices.

20) The benefit of a one-unit increase in an activity

A) is called marginal cost.

B) is always greater than the opportunity cost of that activity.

C) decreases as you do more of it.

D) is measured by what you must give up.

E) is called rational-choice benefit.