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Question 1: John is debating what to do on a Friday night. He has narrowed it down to two possibilities. One option is to see Ghostbusters at a discount theater, a ticket will cost $2.00. John places a value of S6.00 on going to Ghostbusters. The other option is to see Sully at a "regular" theater, a ticket will cost $11.00. John places a value of $12.00 on going to Sully. Suppose John lives equal distance to these two different theaters and the two movies are at the same time. (a) What is John's opportunity cost of going to Ghostbusters? (Want a number answer.) Explain (show) how you reached your answer how you reached your answer. Explain. b) What is John's opportunity cost of going to Sully? (Want a number answer.) Explain (show) (e) Assuming John is rational, using the information above, which movie should John choose? Answer: Question 2: Consider each statement, then answer the questions about the statement. Statement 1: Energy efficient light bulbs are stupid. (a) Is this statement normative or positive? Clearly explain. (b) Now, re-write Statement 1 into the opposite type of statement (e-g. if you said it was normative, re-write the statement into a positive statement). Statement 2: Drinking one coffee a day reduces a person's probability of having a stroke. (c) Is this statement normative or positive? Clearly explain. (d) Now, re-write Statement 2 into the opposite type of statement (e.g. if you said it was normative, re-write the statement into a positive statement). Answer Question 3: A couple weeks ago my friend Susan was given two tickets to a Minnesota Twins game (by someone who could not use them). She offered me one of the tickets. I accepted her offer, and asked "how much do I owe you for a ticket?" She said: "Nothing-they were free." (a) As an economist, why would I protest Susan's (b) What information should Susan take into account before offering me her extra ticket at no cost? Explain. (Specifically think about Susan's choice to give me the ticket in return for no money.) Answer ge 1 of 3 Focus- + 90% 29