These questions cover Chapters 1 and 2; the quiz was given in 1997.

1. Which of the following is a positive statement? [jargon meaning of positive]

a. economics is boring

b. economics is fun

c. there are too many students in this class

d. 222 students are registered for this class section

2. What is jargon label for the other statements? a. negative b. normative c. theoretical d. ceteris paribus

3. "Beer sales in Tallahassee are higher in November and December than in June and July. Therefore, people drink more beer when the weather is colder" This is an example of:

a. a violation of the ceteris paribus assumption b. the fallacy of composition

c. Assuming association implies causation d. a. and c.

4. If, door-to-door, it takes 2 hours and expenditure of $450 for a state worker to fly to Miami, but 8 hours and $150 to drive, at what hourly wage does it just make sense for the State to pay for air travel?

a. $30 b. $37.50 c. $15 d. $50 e. $40 ?

5. If an economy is producing at a point inside its production possibilities curve (PPC), then

a. it could produce more of both kinds of output b. it is being inefficient

c. opportunity cost ideas would be irrelevant d. a. and b.

6. "In Florida, if a car hits a cow on the highway, the cow-owner owes the car-owner for any damage; in some other parts of the world, the car-owner would owe the cow-owner for damages." This is an example of

a. externalities b. opportunity costs c. variations in property rights d. stupidity.

7. Suppose tuition and fees for an in-state student are $2,670 per academic year; books and supplies cost $500; and average earnings of an 18 year old high school graduate in nine months are $11,000. For a Tallahassee resident who just graduated from high school, what is the [money only] opportunity cost of being a full-time student [i.e. not employed] freshman year at FSU?

a. $2,670 b. $14,170 c. $3,170 d. Cannot say without knowing what they spend on board and lodging.

8. A few years ago, the going price for an AK47 in the Beira corridor was 10 kilograms of mealie meal; in Soweto, outside Johannesburg, the going price of an AK47 was about R300, and mealie meal cost about R1 a kilogram. Obviously, there were transport costs, transaction costs, and the trade was illegal, but would you expect the tendency to be:

a. Mealie meal moved from the Beira corridor to Soweto. b. AK47's moved from the Beira corridor to Soweto
 

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c. No trade involving AK47's between Soweto and the Beira corridor d. Both AK47's and mealie meal moved from Soweto to the Beira corridor. 9. A theory or model must capture all the details of reality if it is to be useful a. false b. true