Economics of Small Decisions

30 questions · by Quizbun

Thirty questions on the economics hiding inside ordinary choices — not interest rates and GDP, but the trade-offs you make every day. Covers opportunity cost, the sunk cost fallacy, marginal vs. total cost, fixed vs. variable costs, incentives and their unintended consequences, scarcity and trade-offs, diminishing returns, and why something free so often still has a cost. It mixes concept-spotting (single-choice), find-every-cost scenarios (multiple-choice), and quick marginal-cost and percentage calculations (numeric input). Each question pairs a tempting wrong answer with an explanation that teaches the underlying idea, and every question carries Wikipedia references so you can verify it and read further.

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Questions

Not answered. What does opportunity cost mean?
Not answered. You have one free evening. Your options are an $80 extra shift, a $50 concert, or relaxing at home (worth about $30 to you). You pick the concert. What is the opportunity cost of that choice?
Not answered. Which of these involve a real opportunity cost?
Not answered. You go to a free outdoor concert: $0 entry, but you skip a 4-hour shift paying $15/hour and spend $12 on gas. What is the total economic cost of going, in dollars? (Enter a number.)
Not answered. You bought a $15 movie ticket in advance, but by showtime you feel sick and would honestly enjoy staying home more. Which cost is sunk?
Not answered. What is the sunk cost fallacy?
Not answered. Fill in the missing words: throwing good money after bad — pressing on with a failing plan only because of the time or money already poured in — is the '___ ___ fallacy.' (Give the two words before fallacy.)
Not answered. What is marginal cost?
Not answered. A gym charges a flat $40/month for unlimited visits, with no per-visit fee. Ignoring travel, what is the marginal cost (in dollars) of going one extra time this month? (Enter a number.)
Not answered. A bakery's total cost to bake 50 loaves is $120. To bake 51 loaves it is $122. What is the marginal cost (in dollars) of that 51st loaf? (Enter a number.)
Not answered. A workshop can make 100 chairs for a total cost of $4,000, or 120 chairs for a total cost of $4,500. Over that range, what is the marginal cost per additional chair (in dollars)? (Enter a number.)
Not answered. Economists say good decisions are made 'at the margin.' What does that mean?
Not answered. Which is the best example of a fixed cost for a small café?
Not answered. For that same café, which of these are variable costs that rise as it serves more cups?
Not answered. Fill in the blank: in the short run, a firm's total cost equals its fixed costs plus its ___ costs.
Not answered. A government offers a cash bounty for every dead cobra, hoping to shrink the cobra population — but people start breeding cobras to cash in, and the population grows. An incentive that backfires like this is called a...?
Not answered. In economics, what is an incentive?
Not answered. Which of these are examples of incentives producing unintended consequences?
Not answered. In economics, scarcity refers to...?
Not answered. A country with a fixed budget can build more hospitals or more tanks, but not the maximum of both. This classic illustration of a trade-off is known as...?
Not answered. What is the relationship between a trade-off and an opportunity cost?
Not answered. The phrase 'there's no such thing as a free lunch' (TANSTAAFL) makes which economic point?
Not answered. A phone app costs you no money to download or use. What is the most likely hidden cost?
Not answered. A supermarket sells milk below its own cost to pull shoppers in, betting they'll fill a basket with profitable items too. This pricing tactic is called a...?
Not answered. The law of diminishing returns says that...?
Not answered. On a fixed plot of land, 1 worker harvests 10 baskets, 2 workers harvest 18 total, and 3 workers harvest 24 total. What is the marginal product (extra baskets) of the 3rd worker? (Enter a number.)
Not answered. The first slice of pizza when you're hungry is delicious; the fourth is just okay; the sixth feels like a chore. This is best described as...?
Not answered. Which of these are everyday examples of diminishing returns or diminishing marginal utility?
Not answered. A coffee shop offers unlimited coffee for $40/month. You'd otherwise buy your usual 25 coffees a month at $2 each ($50). What percentage do you save per month by subscribing? (Enter the number only, e.g. 20 for 20%.)
Not answered. Which question best captures thinking like an economist about an everyday choice?