between having more of one good but less of the other. Both show the opportunity cost graphically as the

slope of the constraint (budget or PPF).

5. When individuals compare cost per unit in the grocery store, or characteristics of one product versus

another, they are behaving approximately like the model describes.

6. Since an op-ed makes a case for what should be, it is considered normative.

7. Assuming that the study is not taking an explicit position about whether soft drink consumption is good or

bad, but just reporting the science, it would be considered positive.

Chapter 3

1. Since $1.60 per gallon is above the equilibrium price, the quantity demanded would be lower at 550

gallons and the quantity supplied would be higher at 640 gallons. (These results are due to the laws of

demand and supply, respectively.) The outcome of lower Qd and higher Qs would be a surplus in the

gasoline market of 640 – 550 = 90 gallons.
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