Question 1

Accounting rules:

Accepted Answer

A) specifies the term of exchange,facilitating exchange between strangers. 
B) increases the profitability of inventions,encouraging firms to develop new products. 
C) provides the public with reliable information about the performance of a firm. 
D) increases the risk faced by entrepreneurs. 
A) specifies the term of exchange,facilitating exchange between strangers. 
B) increases the profitability of inventions,encouraging firms to develop new products. 
C) provides the public with reliable information about the performance of a firm. 
D) increases the risk faced by entrepreneurs.

Question 2

Which of the following best defines a public good?

Accepted Answer

A) A public good is available for anyone to utilize,regardless on who pays and who doesn't. 
B) A public good is a good that uses public funds to finance its production. 
C) A public good is a good that is sold to other people in the market. 
D) A public good is a good that requires government approval before it can be produced. 
A) A public good is available for anyone to utilize,regardless on who pays and who doesn't. 
B) A public good is a good that uses public funds to finance its production. 
C) A public good is a good that is sold to other people in the market. 
D) A public good is a good that requires government approval before it can be produced.

Question 3

Suppose Bob can produce more jeans than Joe in a day.Bob has ________ advantage over Joe in sewing jeans.

Accepted Answer

A) an absolute 
B) an absolute and a comparative 
C) a comparative 
D) neither an absolute nor a comparative 
A) an absolute 
B) an absolute and a comparative 
C) a comparative 
D) neither an absolute nor a comparative

Question 4

When the market does NOT produce the most efficient outcomes,it is known as:

Accepted Answer

A) market failure. 
B) corruption. 
C) fraud. 
D) capitalism. 
A) market failure. 
B) corruption. 
C) fraud. 
D) capitalism.

Question 5

When a specialized worker gains insights into a particular task that leads to better production methods it is called:

Accepted Answer

A) continuity. 
B) innovation. 
C) specialization. 
D) repetition. 
A) continuity. 
B) innovation. 
C) specialization. 
D) repetition.

Question 6

Table 3.3
-Consider two individuals,Bob and Jerry,who produce guitars and banjos.Bob and Jerry's weekly productivity are shown in Table 3.3.Which of the following is true?

Accepted Answer

A) Bob has a comparative advantage in producing guitars but not banjos. 
B) Bob has a comparative advantage in producing banjos but not guitars. 
C) Bob has a comparative advantage in producing both goods. 
D) Bob does not have a comparative advantage in producing either good. 
A) Bob has a comparative advantage in producing guitars but not banjos. 
B) Bob has a comparative advantage in producing banjos but not guitars. 
C) Bob has a comparative advantage in producing both goods. 
D) Bob does not have a comparative advantage in producing either good.

Question 7

Adam Smith used the metaphor "invisible hand" to explain that:

Accepted Answer

A) people acting in their own self interest may actually promote the interest of the society as a whole. 
B) people need a push from the government to do what the government thinks is right. 
C) people always act with the interest of society in the back of their minds. 
D) governments always act in the best interest of its citizenry. 
A) people acting in their own self interest may actually promote the interest of the society as a whole. 
B) people need a push from the government to do what the government thinks is right. 
C) people always act with the interest of society in the back of their minds. 
D) governments always act in the best interest of its citizenry.

Question 8

What is the difference between comparative and absolute advantage.

Accepted Answer

Comparative advantage is the a

Question 9

Table 3.2
-Consider two individuals,Rose and Sharon,who produce fish and coconuts.Rose and Sharon's hourly productivity are shown in Table 3.2.Rose's opportunity cost of producing 1 fish is:

Accepted Answer

A) 1/3 coconut. 
B) 1 1/2 coconuts. 
C) 3 coconuts. 
D) 6 coconuts. 
A) 1/3 coconut. 
B) 1 1/2 coconuts. 
C) 3 coconuts. 
D) 6 coconuts.

Question 10

Consider two individuals,Willy and Blythe,who produce carrots and apples.Willy and Blythe's hourly productivity are as follows:   Who has the absolute advantage or comparative advantage in the production of apples or carrots?

Accepted Answer

Willy has the absolute advantage in prod

Question 11

Table 3.1
-Table 3.1 illustrates Willy and Blythe's hourly production for apples and carrots.From the table,we can conclude that:if Willy and Blythe choose to specialize and trade,then:

Accepted Answer

A) Willy will specialize in apples and trade apples for carrots. 
B) Willy will specialize in carrots and trade carrots for apples. 
C) Blythe will specialize in carrots and trade carrots for apples. 
D) None of the above;specialization and trade are not beneficial for Willy and Blythe. 
A) Willy will specialize in apples and trade apples for carrots. 
B) Willy will specialize in carrots and trade carrots for apples. 
C) Blythe will specialize in carrots and trade carrots for apples. 
D) None of the above;specialization and trade are not beneficial for Willy and Blythe.

Question 12

Suppose a product suddenly becomes very popular and the firms producing the product begin to realize large profits.In response,entrepreneurs would:

Accepted Answer

A) enter the market and increase production. 
B) enter the market and decrease production. 
C) exit the market and decrease production. 
D) exit the market and increase production. 
A) enter the market and increase production. 
B) enter the market and decrease production. 
C) exit the market and decrease production. 
D) exit the market and increase production.

Question 13

A comparative advantage is the ability of one person or nation to produce a good at an opportunity cost that is lower than that of another person or nation.

Accepted Answer

A) True 
 B)False

Question 14

A product produced in a foreign country and purchase by residents of the home country is an import.

Accepted Answer

A) True 
 B)False

Question 15

Table 3.2
-Consider two individuals,Rose and Sharon,who produce fish and coconuts.Rose and Sharon's hourly productivity are shown in Table 3.2.Which of the following is true?

Accepted Answer

A) Sharon has an absolute advantage in producing coconuts but not fish. 
B) Sharon has an absolute advantage in producing fish but not coconuts. 
C) Sharon has an absolute advantage in producing both goods. 
D) Sharon does not have an absolute advantage in producing either good. 
A) Sharon has an absolute advantage in producing coconuts but not fish. 
B) Sharon has an absolute advantage in producing fish but not coconuts. 
C) Sharon has an absolute advantage in producing both goods. 
D) Sharon does not have an absolute advantage in producing either good.

Question 16

What is an export?

Accepted Answer

a product produced i

Question 17

Table 3.1
-Table 3.1 illustrates Willy and Blythe's hourly production for apples and carrots.Based on the table,Willy's opportunity cost of 1 carrot is:

Accepted Answer

A) 3 apples. 
B) 4 apples. 
C) 6 apples. 
D) 1.5 apples. 
A) 3 apples. 
B) 4 apples. 
C) 6 apples. 
D) 1.5 apples.

Question 18

Can an individual with no absolute advantage find himself with a comparative in producing a good or a service?

Accepted Answer

Yes.An individual with no absolute advan

Question 19

Table 3.1
-Table 3.1 illustrates Willy and Blythe's hourly production for apples and carrots.From the table,we can conclude that:

Accepted Answer

A) Willy has an absolute advantage in producing apples but not carrots. 
B) Willy has an absolute advantage in producing carrots but not apples. 
C) Willy has an absolute advantage in producing both goods. 
D) Willy does not have an absolute advantage in producing either good. 
A) Willy has an absolute advantage in producing apples but not carrots. 
B) Willy has an absolute advantage in producing carrots but not apples. 
C) Willy has an absolute advantage in producing both goods. 
D) Willy does not have an absolute advantage in producing either good.

Question 20

What is an import?

Accepted Answer

a product produced i

Accounting rules:

Which of the following best defines a public good?

Suppose Bob can produce more jeans than Joe in a day.Bob has ________ advantage over Joe in sewing jeans.

When the market does NOT produce the most efficient outcomes,it is known as:

When a specialized worker gains insights into a particular task that leads to better production methods it is called:

Table 3.3 -Consider two individuals,Bob and Jerry,who produce guitars and banjos.Bob and Jerry's weekly productivity are shown in Table 3.3.Which of the following is true?

Adam Smith used the metaphor "invisible hand" to explain that:

What is the difference between comparative and absolute advantage.

Table 3.2 -Consider two individuals,Rose and Sharon,who produce fish and coconuts.Rose and Sharon's hourly productivity are shown in Table 3.2.Rose's opportunity cost of producing 1 fish is:

Consider two individuals,Willy and Blythe,who produce carrots and apples.Willy and Blythe's hourly productivity are as follows: Who has the absolute advantage or comparative advantage in the production of apples or carrots?

Table 3.1 -Table 3.1 illustrates Willy and Blythe's hourly production for apples and carrots.From the table,we can conclude that:if Willy and Blythe choose to specialize and trade,then:

Suppose a product suddenly becomes very popular and the firms producing the product begin to realize large profits.In response,entrepreneurs would:

A comparative advantage is the ability of one person or nation to produce a good at an opportunity cost that is lower than that of another person or nation.

A product produced in a foreign country and purchase by residents of the home country is an import.

Table 3.2 -Consider two individuals,Rose and Sharon,who produce fish and coconuts.Rose and Sharon's hourly productivity are shown in Table 3.2.Which of the following is true?

What is an export?

Table 3.1 -Table 3.1 illustrates Willy and Blythe's hourly production for apples and carrots.Based on the table,Willy's opportunity cost of 1 carrot is:

Can an individual with no absolute advantage find himself with a comparative in producing a good or a service?

Table 3.1 -Table 3.1 illustrates Willy and Blythe's hourly production for apples and carrots.From the table,we can conclude that:

What is an import?

Introduction: What Is Economics

The Key Principles of Economics

Demand, supply, and Market Equilibrium

Elasticity: a Measure of Responsiveness

Market Efficiency and Government Intervention

Consumer Choice: Utility Theory and Insights From Neuroscience

Production Technology and Cost

Perfect Competition

Monopoly and Price Discrimination

Market Entry and Monopolistic Competition

Oligopoly and Strategic Behavior

Controlling Market Power: Antitrust and Regulation

Imperfect Information: Adverse Selection and Moral Hazard

Public Goods and Public Choice

External Costs and Environmental Policy

The Labor Market and the Distribution of Income

International Trade and Public Policy

Filters

Exam 3: Exchange and Markets

Accounting rules:

Which of the following best defines a public good?

Suppose Bob can produce more jeans than Joe in a day.Bob has ________ advantage over Joe in sewing jeans.

When the market does NOT produce the most efficient outcomes,it is known as:

When a specialized worker gains insights into a particular task that leads to better production methods it is called:

Table 3.3 -Consider two individuals,Bob and Jerry,who produce guitars and banjos.Bob and Jerry's weekly productivity are shown in Table 3.3.Which of the following is true?

Adam Smith used the metaphor "invisible hand" to explain that:

What is the difference between comparative and absolute advantage.

Table 3.2 -Consider two individuals,Rose and Sharon,who produce fish and coconuts.Rose and Sharon's hourly productivity are shown in Table 3.2.Rose's opportunity cost of producing 1 fish is:

Consider two individuals,Willy and Blythe,who produce carrots and apples.Willy and Blythe's hourly productivity are as follows: Who has the absolute advantage or comparative advantage in the production of apples or carrots?

Table 3.1 -Table 3.1 illustrates Willy and Blythe's hourly production for apples and carrots.From the table,we can conclude that:if Willy and Blythe choose to specialize and trade,then:

Suppose a product suddenly becomes very popular and the firms producing the product begin to realize large profits.In response,entrepreneurs would:

A comparative advantage is the ability of one person or nation to produce a good at an opportunity cost that is lower than that of another person or nation.

A product produced in a foreign country and purchase by residents of the home country is an import.

Table 3.2 -Consider two individuals,Rose and Sharon,who produce fish and coconuts.Rose and Sharon's hourly productivity are shown in Table 3.2.Which of the following is true?

What is an export?

Table 3.1 -Table 3.1 illustrates Willy and Blythe's hourly production for apples and carrots.Based on the table,Willy's opportunity cost of 1 carrot is:

Can an individual with no absolute advantage find himself with a comparative in producing a good or a service?

Table 3.1 -Table 3.1 illustrates Willy and Blythe's hourly production for apples and carrots.From the table,we can conclude that:

What is an import?

Introduction: What Is Economics

The Key Principles of Economics

Demand, supply, and Market Equilibrium

Elasticity: a Measure of Responsiveness

Market Efficiency and Government Intervention

Consumer Choice: Utility Theory and Insights From Neuroscience

Production Technology and Cost

Perfect Competition

Monopoly and Price Discrimination

Market Entry and Monopolistic Competition

Oligopoly and Strategic Behavior

Controlling Market Power: Antitrust and Regulation

Imperfect Information: Adverse Selection and Moral Hazard

Public Goods and Public Choice

External Costs and Environmental Policy

The Labor Market and the Distribution of Income

International Trade and Public Policy

Filters