1. What determines whether or not a resource is scarce? Why is the concept of scarcity important to the definition of economics?
2. Discuss the impact of rational self-interest on each of the following decisions:
a. Whether to attend college full time or enter the workforce full time
b. Whether to buy a new textbook or a used one
c. Whether to attend a local college or an out-of-town college
4. The owner of a small pizzeria is deciding whether to increase the radius of delivery area by one mile. What considerations must be taken into account if such a decision is to increase profitability?
Chapter 2
1. Suppose you go to a restaurant and buy an expensive meal. Halfway through, despite feeling full, you decide to clean your plate. After all, you think, you paid for the meal, so you are going to eat all of it. What's wrong with this thinking?
2. You can either spend spring break working at home for $80 per day for five days or go to Florida for the week. If you stay home, your expenses will total about $100. If you go to Florida, the airfare, hotel, food and miscellaneous expenses will total about $700. What's your opportunity cost of going to Florida?
4. Provide some examples of specialized markets or retail outlets. What makes the Web so conducive to specialization?
You need to answer all questions and submit your answers in a single MS Word document.