Subjective Short Answer
1. Economics is the study of ______ .
ANSWER: how society manages its scarce resources.
DIFFICULTY: Easy
LEARNING OBJECTIVES: ECON.MANK.012 - Apply basic, economic principles of individual decision making
that determine how an economy generally works.
TOPICS: Economic thinking
Scarcity
KEYWORDS: BLOOM'S: Knowledge
CUSTOM ID: 001.01 - SAE - MANK08
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2. The term ______ refers to the size of the economic pie, and the term ______ refers to how the pie is divided.
ANSWER: efficiency; equality
DIFFICULTY: Moderate
LEARNING OBJECTIVES: ECON.MANK.012 - Apply basic, economic principles of individual decision making
that determine how an economy generally works.
KEYWORDS: BLOOM'S: Knowledge
CUSTOM ID: 002.01 - SAE - MANK08
3. Explain how government policies that redistribute income from the rich to the poor might reduce efficiency.
ANSWER: They reduce the reward for working hard. As a result, people work less and produce fewer
goods and services.
DIFFICULTY: Moderate
LEARNING OBJECTIVES: ECON.MANK.012 - Apply basic, economic principles of individual decision making
that determine how an economy generally works.
TOPICS: Economic thinking
Equality
KEYWORDS: BLOOM'S: Application
CUSTOM ID: 003.01 - SAE - MANK08
Scenario 1-1
You have the afternoon free. You have a choice between going to the movies with a friend or studying economics for
three hours. If you go to the movies, you will spend $8.00 on a ticket and $4.50 on popcorn. If you choose to study
economics for three hours, you will raise your exam grade by 10 points.
4. Refer to Scenario 1-1. What is your opportunity cost of going to the movies?
ANSWER: $12.50 and 10 points on your exam grade
DIFFICULTY: Moderate
LEARNING OBJECTIVES: ECON.MANK.302 - Identify the opportunity cost of an action.
TOPICS: Economic thinking
Opportunity cost
KEYWORDS: BLOOM'S: Application
CUSTOM ID: 004.01 - SAE - MANK08
5. Refer to Scenario 1-1. What is your opportunity cost of studying economics?
ANSWER: The enjoyment you would have received from going to the movies with your friend.
DIFFICULTY: Moderate
LEARNING OBJECTIVES: ECON.MANK.302 - Identify the opportunity cost of an action.
TOPICS: Economic thinking
Opportunity cost
KEYWORDS: BLOOM'S: Application
CUSTOM ID: 005.01 - SAE - MANK08
Scenario 1-2
Suppose that you have a choice between going to the movies with a friend for two hours or working at your job. If you go
to the movies, you will spend $7 on a ticket and $5 on popcorn. If you choose to work, you will earn $10 an hour.
6. Refer to Scenario 1-2. What is your opportunity cost of going to the movies?
ANSWER: $32
DIFFICULTY: Moderate
Copyright Cengage Learning. Powered by Cognero. Page 3
LEARNING OBJECTIVES: ECON.MANK.302 - Identify the opportunity cost of an action.
TOPICS: Economic thinking
Opportunity cost
KEYWORDS: BLOOM'S: Application
CUSTOM ID: 006.01 - SAE - MANK08
7. Refer to Scenario 1-2. What is your opportunity cost of working?
ANSWER: The enjoyment you would have received from going to the movies with your friend.
DIFFICULTY: Moderate
LEARNING OBJECTIVES: ECON.MANK.302 - Identify the opportunity cost of an action.
TOPICS: Economic thinking
Opportunity cost
KEYWORDS: BLOOM'S: Application
CUSTOM ID: 007.01 - SAE - MANK08
Full download link: https://bit.ly/3Idyfy8
8. Debbie quits her job, which pays $30,000 a year, to finish her college degree. Her annual college expenses are $10,000
for tuition, $2,000 for books, and $700 for food. What is her opportunity cost of attending college for the year?
ANSWER: $42,000
DIFFICULTY: Moderate
LEARNING OBJECTIVES: ECON.MANK.302 - Identify the opportunity cost of an action.
TOPICS: Economic thinking
Opportunity cost
KEYWORDS: BLOOM'S: Application
CUSTOM ID: 008.01 - SAE - MANK08
9. Zack quits his job at a consulting firm, which pays $40,000 a year, to enroll in a two-year graduate program. His annual
school expenses are $30,000 for tuition, $2,000 for books, and $600 for food. What is his opportunity cost of attending the
two-year graduate program?
ANSWER: $144,000
DIFFICULTY: Moderate
LEARNING OBJECTIVES: ECON.MANK.302 - Identify the opportunity cost of an action.
TOPICS: Economic thinking
Opportunity cost
KEYWORDS: BLOOM'S: Analysis
CUSTOM ID: 009.01 - SAE - MANK08
10. Give an example of a trade-off faced by society.
ANSWER: Efficiency and equality; a clean environment and a high level of income; guns and butter
(national defense and consumer goods)
DIFFICULTY: Easy
1. Economics is the study of ______ .
ANSWER: how society manages its scarce resources.
DIFFICULTY: Easy
LEARNING OBJECTIVES: ECON.MANK.012 - Apply basic, economic principles of individual decision making
that determine how an economy generally works.
TOPICS: Economic thinking
Scarcity
KEYWORDS: BLOOM'S: Knowledge
CUSTOM ID: 001.01 - SAE - MANK08
Copyright Cengage Learning. Powered by Cognero. Page 2
2. The term ______ refers to the size of the economic pie, and the term ______ refers to how the pie is divided.
ANSWER: efficiency; equality
DIFFICULTY: Moderate
LEARNING OBJECTIVES: ECON.MANK.012 - Apply basic, economic principles of individual decision making
that determine how an economy generally works.
KEYWORDS: BLOOM'S: Knowledge
CUSTOM ID: 002.01 - SAE - MANK08
3. Explain how government policies that redistribute income from the rich to the poor might reduce efficiency.
ANSWER: They reduce the reward for working hard. As a result, people work less and produce fewer
goods and services.
DIFFICULTY: Moderate
LEARNING OBJECTIVES: ECON.MANK.012 - Apply basic, economic principles of individual decision making
that determine how an economy generally works.
TOPICS: Economic thinking
Equality
KEYWORDS: BLOOM'S: Application
CUSTOM ID: 003.01 - SAE - MANK08
Scenario 1-1
You have the afternoon free. You have a choice between going to the movies with a friend or studying economics for
three hours. If you go to the movies, you will spend $8.00 on a ticket and $4.50 on popcorn. If you choose to study
economics for three hours, you will raise your exam grade by 10 points.
4. Refer to Scenario 1-1. What is your opportunity cost of going to the movies?
ANSWER: $12.50 and 10 points on your exam grade
DIFFICULTY: Moderate
LEARNING OBJECTIVES: ECON.MANK.302 - Identify the opportunity cost of an action.
TOPICS: Economic thinking
Opportunity cost
KEYWORDS: BLOOM'S: Application
CUSTOM ID: 004.01 - SAE - MANK08
5. Refer to Scenario 1-1. What is your opportunity cost of studying economics?
ANSWER: The enjoyment you would have received from going to the movies with your friend.
DIFFICULTY: Moderate
LEARNING OBJECTIVES: ECON.MANK.302 - Identify the opportunity cost of an action.
TOPICS: Economic thinking
Opportunity cost
KEYWORDS: BLOOM'S: Application
CUSTOM ID: 005.01 - SAE - MANK08
Scenario 1-2
Suppose that you have a choice between going to the movies with a friend for two hours or working at your job. If you go
to the movies, you will spend $7 on a ticket and $5 on popcorn. If you choose to work, you will earn $10 an hour.
6. Refer to Scenario 1-2. What is your opportunity cost of going to the movies?
ANSWER: $32
DIFFICULTY: Moderate
Copyright Cengage Learning. Powered by Cognero. Page 3
LEARNING OBJECTIVES: ECON.MANK.302 - Identify the opportunity cost of an action.
TOPICS: Economic thinking
Opportunity cost
KEYWORDS: BLOOM'S: Application
CUSTOM ID: 006.01 - SAE - MANK08
7. Refer to Scenario 1-2. What is your opportunity cost of working?
ANSWER: The enjoyment you would have received from going to the movies with your friend.
DIFFICULTY: Moderate
LEARNING OBJECTIVES: ECON.MANK.302 - Identify the opportunity cost of an action.
TOPICS: Economic thinking
Opportunity cost
KEYWORDS: BLOOM'S: Application
CUSTOM ID: 007.01 - SAE - MANK08
Full download link: https://bit.ly/3Idyfy8
8. Debbie quits her job, which pays $30,000 a year, to finish her college degree. Her annual college expenses are $10,000
for tuition, $2,000 for books, and $700 for food. What is her opportunity cost of attending college for the year?
ANSWER: $42,000
DIFFICULTY: Moderate
LEARNING OBJECTIVES: ECON.MANK.302 - Identify the opportunity cost of an action.
TOPICS: Economic thinking
Opportunity cost
KEYWORDS: BLOOM'S: Application
CUSTOM ID: 008.01 - SAE - MANK08
9. Zack quits his job at a consulting firm, which pays $40,000 a year, to enroll in a two-year graduate program. His annual
school expenses are $30,000 for tuition, $2,000 for books, and $600 for food. What is his opportunity cost of attending the
two-year graduate program?
ANSWER: $144,000
DIFFICULTY: Moderate
LEARNING OBJECTIVES: ECON.MANK.302 - Identify the opportunity cost of an action.
TOPICS: Economic thinking
Opportunity cost
KEYWORDS: BLOOM'S: Analysis
CUSTOM ID: 009.01 - SAE - MANK08
10. Give an example of a trade-off faced by society.
ANSWER: Efficiency and equality; a clean environment and a high level of income; guns and butter
(national defense and consumer goods)
DIFFICULTY: Easy