Economics Homework One Answers - Student Eleven

TrishaM

1. An example of a good is dog food while a service is someone taking care of the dog for you while you're away.

Right.

2. Eating at home is less expensive than eating out because driving to McDonald's would use up time, which is valuable, and the food is more expensive than just staying home and making something from scratch.

OK. Driving time is one transaction cost, but the question asked for two. Please see model answers when available. (Minus 1).

3. Something is scarce only if people want/need it and are willing to pay for it. If the amount of gas decreases, people will pay a higher price for it.

Good.

4. The "invisible hand" is a force that leads people to work for themselves while also helping others. Someone working at a day care, for example, is working to make money but is also taking care of someone else's child for them.

Good again.

5. Matthew 20: 1-16: If you agree to give someone a set wage, no matter how late they start on the job, you shouldn't change it just because someone else has been working for a longer amount of time. The same is true of heaven. No matter how late you are accepted into the Kingdom of God, He's not going to give the people who have been in longer more reward just because of that.

Excellent. May use as a model answer.

6. To me, "caveat emptor" means that I should be very careful in what I invest my time and money in since it could be a bad idea.

Superb.

Good start! 59/60.--Andy Schlafly 10:48, 13 September 2009 (EDT)