Question 1

Public policies

Accepted Answer

A) may be able to improve either economic efficiency or equality. 
B) may be able to improve economic efficiency but cannot improve equality. 
C) may be able to improve equality but cannot improve economic efficiency. 
D) cannot improve either equality or economic efficiency. 
A) may be able to improve either economic efficiency or equality. 
B) may be able to improve economic efficiency but cannot improve equality. 
C) may be able to improve equality but cannot improve economic efficiency. 
D) cannot improve either equality or economic efficiency.

Question 2

Following the implementation of laws requiring automobiles to have seat belts, which of the following occurred?

Accepted Answer

A) An individual's probability of surviving an auto accident rose. 
B) There was an increase in pedestrian deaths. 
C) There was an increase in automobile accidents. 
D) All of the above are correct. 
A) An individual's probability of surviving an auto accident rose. 
B) There was an increase in pedestrian deaths. 
C) There was an increase in automobile accidents. 
D) All of the above are correct.

Question 3

The relatively low inflation experienced in the United States in the 1990s is attributable to

Accepted Answer

A) slow growth of U.S. productivity during the 1990s. 
B) slow growth of the quantity of money in the U.S. in the 1990s. 
C) low levels of government spending in the U.S. in the 1980s and 1990s. 
D) the eight-year presidency of William Jefferson Clinton during the 1990s. 
A) slow growth of U.S. productivity during the 1990s. 
B) slow growth of the quantity of money in the U.S. in the 1990s. 
C) low levels of government spending in the U.S. in the 1980s and 1990s. 
D) the eight-year presidency of William Jefferson Clinton during the 1990s.

Question 4

Communist countries worked under the premise that

Accepted Answer

A) people, when left on their own without government intervention, will find the best use of available resources 
B) central planners were in the best position to determine the allocation of scarce resources in the economy. 
C) households and firms, guided by an "invisible hand," could achieve the most efficient allocation of scarce resources. 
D) allowing the market forces of supply and demand to operate with no government intervention would achieve the most efficient allocation of scarce resources. 
A) people, when left on their own without government intervention, will find the best use of available resources 
B) central planners were in the best position to determine the allocation of scarce resources in the economy. 
C) households and firms, guided by an "invisible hand," could achieve the most efficient allocation of scarce resources. 
D) allowing the market forces of supply and demand to operate with no government intervention would achieve the most efficient allocation of scarce resources.

Question 5

The "invisible hand" influences market behavior through trade.​

Accepted Answer

A) True 
 B)False

Question 6

Scenario 1-2
Suppose that you have a choice between going to the movies with a friend for two hours or working at your job. If you go to the movies, you will spend $7 on a ticket and $5 on popcorn. If you choose to work, you will earn $10 an hour.
-Refer to Scenario 1-2. What is your opportunity cost of going to the movies?

Accepted Answer

The answer of Scenario 1-2
Suppose that you have a choice...

Question 7

Which of the following statements about market economies is correct?

Accepted Answer

A) In a market economy, no one is looking out for the economic well-being of society as a whole. 
B) Market economies are characterized by decentralized decision making and self-interested decision makers. 
C) Market economies have proven remarkably successful in promoting overall economic well-being. 
D) All of the above are correct. 
A) In a market economy, no one is looking out for the economic well-being of society as a whole. 
B) Market economies are characterized by decentralized decision making and self-interested decision makers. 
C) Market economies have proven remarkably successful in promoting overall economic well-being. 
D) All of the above are correct.

Question 8

The term market failure refers to

Accepted Answer

A) a situation in which the market on its own fails to allocate resources efficiently. 
B) an unsuccessful advertising campaign which reduces demand for a product. 
C) a situation in which competition among firms becomes ruthless. 
D) a firm that is forced out of business because of losses. 
A) a situation in which the market on its own fails to allocate resources efficiently. 
B) an unsuccessful advertising campaign which reduces demand for a product. 
C) a situation in which competition among firms becomes ruthless. 
D) a firm that is forced out of business because of losses.

Question 9

The self-interest of the participants in an economy is guided into promoting general economic self-interest by

Accepted Answer

A) the invisible hand. 
B) market power. 
C) government intervention. 
D) oikonomos. 
A) the invisible hand. 
B) market power. 
C) government intervention. 
D) oikonomos.

Question 10

The tradeoff between inflation and unemployment

Accepted Answer

A) implies that policies designed to reduce unemployment also reduce inflation. 
B) was eliminated by improved economic policies in the 1900s. 
C) is a long-run tradeoff, persisting for decades, according to most economists. 
D) None of the above are correct. 
A) implies that policies designed to reduce unemployment also reduce inflation. 
B) was eliminated by improved economic policies in the 1900s. 
C) is a long-run tradeoff, persisting for decades, according to most economists. 
D) None of the above are correct.

Question 11

Which of the following firms is likely to have the greatest market power?

Accepted Answer

A) an electric company 
B) a farmer 
C) a grocery store 
D) a local electronics retailer 
A) an electric company 
B) a farmer 
C) a grocery store 
D) a local electronics retailer

Question 12

In an economy in which decisions are guided by prices and individual self-interest, there is

Accepted Answer

A) the potential to achieve efficiency in production. 
B) a strong need for government intervention in the market. 
C) less efficiency than would be observed in a centrally-planned economy. 
D) more need for a strong legal system to control individual greed than would be needed in a centrally-planned economy. 
A) the potential to achieve efficiency in production. 
B) a strong need for government intervention in the market. 
C) less efficiency than would be observed in a centrally-planned economy. 
D) more need for a strong legal system to control individual greed than would be needed in a centrally-planned economy.

Question 13

Economists use the term ______ to refer to fluctuations in economic activity, such as employment and production.

Accepted Answer

The answer of Economists use the term ______ to refer...

Question 14

​Which of the following industries has a marginal cost that is close to zero?

Accepted Answer

A) ​automobile 
B) ​aircraft 
C) ​software 
D) ​furniture 
A) ​automobile 
B) ​aircraft 
C) ​software 
D) ​furniture

Question 15

Under what conditions might government intervention in a market economy improve the economy's performance?

Accepted Answer

If there is a market failure, such as an

Exam 1: Ten Principles of Economics

Public policies

Following the implementation of laws requiring automobiles to have seat belts, which of the following occurred?

The relatively low inflation experienced in the United States in the 1990s is attributable to

Communist countries worked under the premise that

The "invisible hand" influences market behavior through trade.​

Which of the following statements about market economies is correct?

The term market failure refers to

The self-interest of the participants in an economy is guided into promoting general economic self-interest by

The tradeoff between inflation and unemployment

Which of the following firms is likely to have the greatest market power?

In an economy in which decisions are guided by prices and individual self-interest, there is

Economists use the term ______ to refer to fluctuations in economic activity, such as employment and production.

​Which of the following industries has a marginal cost that is close to zero?

Under what conditions might government intervention in a market economy improve the economy's performance?

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Applications: the Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers in Microeconomics

Measuring a Nation S Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

Tools of Finance

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

Filters

The "invisible hand" influences market behavior through trade.

Which of the following industries has a marginal cost that is close to zero?