b.
Pizza will not be delivered to campus dorms after 10 p.m.
c.
Campus police institute a policy of impounding cars parked in delivery-zone spaces.
d.
You expect to lose your spot on a varsity team if your grades fall.
ANSWER:
a
219. Which of the following is NOT an economic incentive?
a.
prices
b.
wages
c.
sales taxes
d.
employee awards
ANSWER:
d
220. What is a subsidy on hybrid cars?
a.
a net benefit
b.
a positive incentive
c.
an optimal cost
d.
a marginal benefit
ANSWER:
b
221. Which of the following is likely to provide teenagers with the greatest incentive NOT to smoke?
a.
a law prohibiting anyone from smoking on public property
b.
a $5.00 per-pack tax on cigarettes
c.
a public service television advertisement featuring singer Kelly Clarkson urging kids to refrain from smoking
d.
a refusal by actor Emilia Clarke to play any part in which she will be seen smoking
ANSWER:
b
222. If incentives matter, then policies can be used to discourage undesirable behaviour. Which of the following policies would NOT likely help protect wildlife?
a.
a reduction in the number of park rangers and law enforcement personnel
b.
jail sentences for camping or littering in protected areas
c.
fines on hunting
d.
the provision of additional rangers and law enforcement personnel
ANSWER:
a
223. Why do people specialize?
a.
so that society becomes wealthier while not using their resources
b.
so that people avoid having to trade
c.
so that individuals can increase their opportunity cost for an activity
d.
so that individuals make the best use of resources by devoting themselves to one primary productive activity
ANSWER:
d
224. Under what circumstance does a country specialize in an attempt to use its resources more efficiently?
a.
when a country has a comparative advantage in production
b.
when a country has an absolute advantage in production
c.
when a country has a disincentive to trade with others
d.
when a country has a higher opportunity cost to trade with others
ANSWER:
a
225. Arwen is an accountant and an excellent typist. He can type 120 words per minute, but he has all the accounting work he can handle at $90 per hour. Arwen's friend Cersei sells furniture, earning $25 per hour. Cersei would like some typing work but can type only 60 words per minute. What is the most efficient scenario?
a.
Cersei should do the typing, and Arwen should pay her $20 per hour.
b.
Arwen should do all the typing because he is faster.
c.
Unless Cersei can match Arwen's typing speed, she should remain a salesperson.
d.
Cersei should do the typing as long as her earnings are more than $25 and less than $45 per hour.
ANSWER:
d
226. Missandei makes millions of dollars a year playing cricket. Missandei is also the best chef in her hometown. Based on the theory of specialization, why doesn't Missandei make her own food?
a.
Missandei has a comparative advantage in cooking.
b.
The opportunity cost to her of cooking her own food is very low because it takes away from her lucrative cricket career.
c.
The opportunity cost to her of cooking her own food is very high because it takes away from her lucrative cricket career.
d.
Missandei does not face an opportunity cost in this situation since she is good at both activities.
ANSWER:
c
227. When do individuals have a comparative advantage in production?