Question 1

There would be no economic problems in a world in which all resources were

Accepted Answer

A)  free. 
B)  natural. 
C)  bought and sold for a price. 
D)  owned by the government. 
E)  scarce. 
A)  free. 
B)  natural. 
C)  bought and sold for a price. 
D)  owned by the government. 
E)  scarce. A

Question 2

The following question is based on the following table:
  
-The relationship between household income and number of DVD players is

Accepted Answer

A)  nonexistent. 
B)  direct. 
C)  negative. 
D)  fluctuating. 
E)  terminal. 
A)  nonexistent. 
B)  direct. 
C)  negative. 
D)  fluctuating. 
E)  terminal. B

Question 3

A movement from an output combination inside the production possibilities curve to a combination on the curve

Accepted Answer

A)  requires an increase in resources or an improvement in technology. 
B)  leads to an increase in inequality in the distribution of income. 
C)  is possible only if the production possibilities curve shifts inward to the left. 
D)  enables society to increase the output of one good without reducing the output of another good. 
E)  leads to a decline in per capita output. 
A)  requires an increase in resources or an improvement in technology. 
B)  leads to an increase in inequality in the distribution of income. 
C)  is possible only if the production possibilities curve shifts inward to the left. 
D)  enables society to increase the output of one good without reducing the output of another good. 
E)  leads to a decline in per capita output. D

Question 4

A production possibilities curve illustrates

Accepted Answer

A)  opportunity costs. 
B)  a market. 
C)  principles of taxation. 
D)  income distribution. 
E)  the circular flow. 
A)  opportunity costs. 
B)  a market. 
C)  principles of taxation. 
D)  income distribution. 
E)  the circular flow.

Question 5

Excluded from the tasks an economic system must perform is determining

Accepted Answer

A)  how free resources are to be allocated. 
B)  the level and composition of society's output. 
C)  how each good and service is to be produced. 
D)  the rate of growth of per capita income. 
E)  how goods and services are to be distributed. 
A)  how free resources are to be allocated. 
B)  the level and composition of society's output. 
C)  how each good and service is to be produced. 
D)  the rate of growth of per capita income. 
E)  how goods and services are to be distributed.

Question 6

When a decision is made to undertake a particular course of action,its opportunity cost

Accepted Answer

A)  is either zero or irrelevant. 
B)  disappears if the course of action is chosen voluntarily. 
C)  is measured by the amount of gain from the course of action. 
D)  may be computed by adding the gain from that action to the gains possible from alternate actions. 
E)  is that which is made impossible by the course of action. 
A)  is either zero or irrelevant. 
B)  disappears if the course of action is chosen voluntarily. 
C)  is measured by the amount of gain from the course of action. 
D)  may be computed by adding the gain from that action to the gains possible from alternate actions. 
E)  is that which is made impossible by the course of action.

Question 7

Economic resources have a price above zero because

Accepted Answer

A)  there are no other uses for them. 
B)  they cannot be easily moved from place to place. 
C)  otherwise they would not be able to satisfy human wants. 
D)  they are relatively scarce. 
E)  they are unlimited in supply. 
A)  there are no other uses for them. 
B)  they cannot be easily moved from place to place. 
C)  otherwise they would not be able to satisfy human wants. 
D)  they are relatively scarce. 
E)  they are unlimited in supply.

Question 8

Economists generally classify economic resources into what three categories?

Accepted Answer

A)  men, money, and machines 
B)  savings, spending, and investment 
C)  land, labor, and capital 
D)  physical, human, and technological 
E)  employed, unemployed, and free 
A)  men, money, and machines 
B)  savings, spending, and investment 
C)  land, labor, and capital 
D)  physical, human, and technological 
E)  employed, unemployed, and free

Question 9

The expression "there's no such thing as a 'free lunch'" is

Accepted Answer

A)  generally untrue. 
B)  irrelevant to the subject of economics. 
C)  a recognition that our capacity to produce goods is limited. 
D)  an example of normative economics. 
E)  applicable solely to the inefficient use of resources. 
A)  generally untrue. 
B)  irrelevant to the subject of economics. 
C)  a recognition that our capacity to produce goods is limited. 
D)  an example of normative economics. 
E)  applicable solely to the inefficient use of resources.

Question 10

All output combinations that fall on an economy's production possibilities curve

Accepted Answer

A)  can be chosen simultaneously. 
B)  represent the minimum amounts of each good that can be produced. 
C)  show the distribution of goods and services in the economy. 
D)  tell us little or nothing about a society's level and composition of output. 
E)  represent the full and efficient use of that economy's resources. 
A)  can be chosen simultaneously. 
B)  represent the minimum amounts of each good that can be produced. 
C)  show the distribution of goods and services in the economy. 
D)  tell us little or nothing about a society's level and composition of output. 
E)  represent the full and efficient use of that economy's resources.

Question 11

The basic characteristic of an economic resource is that it

Accepted Answer

A)  is made by machine. 
B)  is free. 
C)  is relatively scarce. 
D)  consists of buildings, equipment, and inventories. 
E)  comes from the earth. 
A)  is made by machine. 
B)  is free. 
C)  is relatively scarce. 
D)  consists of buildings, equipment, and inventories. 
E)  comes from the earth.

Question 12

The best economic models

Accepted Answer

A)  are complex. 
B)  are chosen by secret ballot. 
C)  make a profit. 
D)  cannot be quantified. 
E)  forecast accurately. 
A)  are complex. 
B)  are chosen by secret ballot. 
C)  make a profit. 
D)  cannot be quantified. 
E)  forecast accurately.

Question 13

The following question is based on the following table:
Percentage Distribution of Households by Annual Income, United States, 2009
  
-Using the table above,82 percent of the households in 2009 had annual incomes of

Accepted Answer

A)  less than $15,000. 
B)  more than $25,000. 
C)  between $35,000 and $50,000. 
D)  at least $75,000. 
E)  more than $100,000. 
A)  less than $15,000. 
B)  more than $25,000. 
C)  between $35,000 and $50,000. 
D)  at least $75,000. 
E)  more than $100,000.

Question 14

A production possibilities curve is least helpful when it comes to analyzing which of the basic tasks facing an economic system?

Accepted Answer

A)  determining what is produced 
B)  determining how goods are produced 
C)  determining how society's output is distributed 
D)  determining society's rate of growth 
E)  all the basic economic tasks facing an economic system 
A)  determining what is produced 
B)  determining how goods are produced 
C)  determining how society's output is distributed 
D)  determining society's rate of growth 
E)  all the basic economic tasks facing an economic system

Question 15

The United States could expand output of both civilian and military goods during the period from 1939 through the early part of World War II because

Accepted Answer

A)  output per worker fell as more men were drafted by the military. 
B)  it captured large amounts of new resources from enemy territory. 
C)  military goods are produced using different resources than consumer goods. 
D)  during the 1930s it was operating well inside its production possibilities curve. 
E)  its production possibilities curve was bowed out during World War II. 
A)  output per worker fell as more men were drafted by the military. 
B)  it captured large amounts of new resources from enemy territory. 
C)  military goods are produced using different resources than consumer goods. 
D)  during the 1930s it was operating well inside its production possibilities curve. 
E)  its production possibilities curve was bowed out during World War II.

Question 16

The poor performance of the U.S.economy relative to other industrialized countries during the 1970s,1980s,and early 1990s was called

Accepted Answer

A)  disflation. 
B)  reflation. 
C)  a competitiveness problem. 
D)  unflation. 
E)  proflation. 
A)  disflation. 
B)  reflation. 
C)  a competitiveness problem. 
D)  unflation. 
E)  proflation.

Question 17

Labor productivity is measured by the

Accepted Answer

A)  unemployment rate divided by the employment rate. 
B)  output per hour of labor. 
C)  ratio of labor to capital with a given technology. 
D)  labor force participation rate. 
E)  size of the labor force. 
A)  unemployment rate divided by the employment rate. 
B)  output per hour of labor. 
C)  ratio of labor to capital with a given technology. 
D)  labor force participation rate. 
E)  size of the labor force.

Question 18

Cutting an English class to prepare for an economics exam is an example of

Accepted Answer

A)  normative economics. 
B)  the fallacy of composition. 
C)  a nonproductive activity. 
D)  an inverse relationship. 
E)  opportunity cost. 
A)  normative economics. 
B)  the fallacy of composition. 
C)  a nonproductive activity. 
D)  an inverse relationship. 
E)  opportunity cost.

Question 19

Economic analysis is

Accepted Answer

A)  widely understood by all in our society. 
B)  important for solving problems in developing and socialist societies but of little use in Western capitalist systems. 
C)  a set of mathematical rules to ensure a society's happiness and prosperity. 
D)  a framework for understanding issues that arise because societies need to make allocational decisions. 
E)  a natural science concerned with biological growth and change of the social system. 
A)  widely understood by all in our society. 
B)  important for solving problems in developing and socialist societies but of little use in Western capitalist systems. 
C)  a set of mathematical rules to ensure a society's happiness and prosperity. 
D)  a framework for understanding issues that arise because societies need to make allocational decisions. 
E)  a natural science concerned with biological growth and change of the social system.

Question 20

The following question are based on the following production possibilities curve:
  
-Suppose 4 million tractors wear out each year.If society wishes to push next year's production possibilities curve outward,the best point to choose of those shown is

Accepted Answer

A)  A. 
B)  B. 
C)  C. 
D)  D. 
E)  E. 
A)  A. 
B)  B. 
C)  C. 
D)  D. 
E)  E.

Exam 1: What is Economics

There would be no economic problems in a world in which all resources were

The following question is based on the following table: -The relationship between household income and number of DVD players is

A movement from an output combination inside the production possibilities curve to a combination on the curve

A production possibilities curve illustrates

Excluded from the tasks an economic system must perform is determining

When a decision is made to undertake a particular course of action,its opportunity cost

Economic resources have a price above zero because

Economists generally classify economic resources into what three categories?

The expression "there's no such thing as a 'free lunch'" is

All output combinations that fall on an economy's production possibilities curve

The basic characteristic of an economic resource is that it

The best economic models

The following question is based on the following table: Percentage Distribution of Households by Annual Income, United States, 2009 -Using the table above,82 percent of the households in 2009 had annual incomes of

A production possibilities curve is least helpful when it comes to analyzing which of the basic tasks facing an economic system?

The United States could expand output of both civilian and military goods during the period from 1939 through the early part of World War II because

The poor performance of the U.S.economy relative to other industrialized countries during the 1970s,1980s,and early 1990s was called

Labor productivity is measured by the

Cutting an English class to prepare for an economics exam is an example of

Economic analysis is

The following question are based on the following production possibilities curve: -Suppose 4 million tractors wear out each year.If society wishes to push next year's production possibilities curve outward,the best point to choose of those shown is

Markets and Prices

The Business Firm: Organization,motivation,and Optimal Input Decisions

Getting Behind the Demand and Supply Curves

Market Demand and Price Elasticity

Economic Efficiency,market Supply,and Perfect Competition

Monopoly and Its Regulation

Monopolistic Competition,oligopoly,and Antitrust Policy

Pollution and the Environment

The Supply and Demand for Labor

Interest,rent,and Profit

Poverty,income Inequality,and Discrimination

Economic Growth

Public Goods and the Role of the Government

National Income and Product

Business Fluctuations and Unemployment

The Determination of National Output and the Keynesian Multiplier

Fiscal Policy and National Output

Inflation

Money and the Banking System

The Federal Reserve and Monetary Policy

Supply Shocks and Inflation

Productivity,growth,and Technology Policy

Surpluses,deficits,public Debt,and the Federal Budget

Monetary Policy,interest Rates,and Economic Activity

Controversies Over Stabilization Policy

International Trade

Exchange Rates and the Balance of Payments

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