Question 1

Villagers in Xiaogang, China, produced more rice than those in surrounding villages because:

Accepted Answer

A)  they had better farmland. 
B)  they were given better seeds. 
C)  they were able to keep the output they produced individually. 
D)  they made each family responsible for a certain, higher quota of rice production. 
E)  they had common ownership over the rice produced. 
A)  they had better farmland. 
B)  they were given better seeds. 
C)  they were able to keep the output they produced individually. 
D)  they made each family responsible for a certain, higher quota of rice production. 
E)  they had common ownership over the rice produced.

Question 2

Scarcity:

Accepted Answer

A)  ensures that people become satisfied with less than what they want. 
B)  exists only during a recession. 
C)  exists only in some countries. 
D)  affects only poor people. 
E)  requires people to make choices to satisfy their wants. 
A)  ensures that people become satisfied with less than what they want. 
B)  exists only during a recession. 
C)  exists only in some countries. 
D)  affects only poor people. 
E)  requires people to make choices to satisfy their wants.

Question 3

Specialization according to comparative advantage, followed by trade, allows everyone to acquire more of the goods they want.

Accepted Answer

A) True 
 B)False

Question 4

Opportunity cost:

Accepted Answer

A)  applies only to consumption decisions. 
B)  applies only to production decisions. 
C)  is the same as monetary costs. 
D)  exists because of scarcity. 
E)  is irrelevant for wealthy economies. 
A)  applies only to consumption decisions. 
B)  applies only to production decisions. 
C)  is the same as monetary costs. 
D)  exists because of scarcity. 
E)  is irrelevant for wealthy economies.

Question 5

A limitation one faces when shopping for clothes is the amount of time available to shop.

Accepted Answer

A) True 
 B)False

Question 6

Opportunity cost is best defined as the:

Accepted Answer

A)  sum of all alternatives given up when a choice is made. 
B)  money spent once a choice is made. 
C)  highest-valued alternative given up when a choice is made. 
D)  cost of a good minus the satisfaction obtained from consuming it. 
E)  cost of capital resources used in the production of additional capital. 
A)  sum of all alternatives given up when a choice is made. 
B)  money spent once a choice is made. 
C)  highest-valued alternative given up when a choice is made. 
D)  cost of a good minus the satisfaction obtained from consuming it. 
E)  cost of capital resources used in the production of additional capital.

Question 7

To say that there is a scarcity of gold means that:

Accepted Answer

A)  gold prices will fall in the future. 
B)  there is not enough gold to satisfy people's demand for it at a zero price. 
C)  there are very few substitutes for gold. 
D)  gold is very expensive. 
E)  the demand for gold is changing. 
A)  gold prices will fall in the future. 
B)  there is not enough gold to satisfy people's demand for it at a zero price. 
C)  there are very few substitutes for gold. 
D)  gold is very expensive. 
E)  the demand for gold is changing.

Question 8

Choices must be made because of scarcity; people do not have enough time or money to get everything they want.

Accepted Answer

A) True 
 B)False

Question 9

Economics is the study of:

Accepted Answer

A)  the allocation of scarce resources and the ways in which human decision makers utilize those resources. 
B)  the methods that human decision makers use to transform a scarce good into a non-economic good. 
C)  how to operate a business successfully. 
D)  a utopian society. 
E)  how to make money in the stock market. 
A)  the allocation of scarce resources and the ways in which human decision makers utilize those resources. 
B)  the methods that human decision makers use to transform a scarce good into a non-economic good. 
C)  how to operate a business successfully. 
D)  a utopian society. 
E)  how to make money in the stock market.

Question 10

According to economic analysis, while making a decision, an individual compares the benefits expected from one option with the benefits expected from other options.

Accepted Answer

A) True 
 B)False

Question 11

In 1981, in San Francisco Solano, Argentina, about 1,800 families took over a piece of wasteland. The government was able to deed 60 percent of this land to some families while the remaining part could not be deeded. The resulting houses varied greatly, based on whether the residents received title. Those who received title also behaved differently, having fewer children, and the children experienced more education and better health. This is an example of the results from:

Accepted Answer

A)  scarcity. 
B)  economic growth. 
C)  economic freedom. 
D)  private property rights. 
E)  improved quality of life. 
A)  scarcity. 
B)  economic growth. 
C)  economic freedom. 
D)  private property rights. 
E)  improved quality of life.

Question 12

Which of the following should not be considered as an opportunity cost of attending college?

Accepted Answer

A)  Expenses that are the same whether or not you attend college 
B)  Lost salary 
C)  Business lunches 
D)  Interest that could have been earned on your money had you put the money into a savings account, rather than spent it on tuition 
E)  Opportunities sacrificed in the decision to attend college 
A)  Expenses that are the same whether or not you attend college 
B)  Lost salary 
C)  Business lunches 
D)  Interest that could have been earned on your money had you put the money into a savings account, rather than spent it on tuition 
E)  Opportunities sacrificed in the decision to attend college

Question 13

An economy's resources:

Accepted Answer

A)  are limited in quantity. 
B)  are always efficiently utilized. 
C)  consist of land, labor, capital, and money. 
D)  are unrelated to its standard of living. 
E)  are unlimited when we use the latest technology. 
A)  are limited in quantity. 
B)  are always efficiently utilized. 
C)  consist of land, labor, capital, and money. 
D)  are unrelated to its standard of living. 
E)  are unlimited when we use the latest technology.

Question 14

A positive (non-zero) price for a good means there is a surplus of that good.

Accepted Answer

A) True 
 B)False

Question 15

Table 1.4
  
-Assume that our national economy is operating at a point on its bowed-out production possibilities curve. According to the production possibilities schedule in Table 1.4, if our nation produces more of Good A, then:

Accepted Answer

A)  it must sacrifice larger and larger amounts of Good B to do so. 
B)  the amount of Good B that must be forgone decreases. 
C)  the resources transferred will be increasingly efficient in producing Good A. 
D)  it must have a comparative advantage in the production of Good A. 
E)  we will experience a greater rate of economic growth. 
A)  it must sacrifice larger and larger amounts of Good B to do so. 
B)  the amount of Good B that must be forgone decreases. 
C)  the resources transferred will be increasingly efficient in producing Good A. 
D)  it must have a comparative advantage in the production of Good A. 
E)  we will experience a greater rate of economic growth.

Question 16

Figure 1.3
  
-In Figure 1.3, underutilization of resources is represented by point:

Accepted Answer

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

Question 17

Table 1.4
  
-According to the production possibilities schedule in Table 1.4, which of the following statements is true?

Accepted Answer

A)  If one moves from choice 2 to choice 3, the opportunity cost of 20 more units of good B is 20 units of good A. 
B)  There are increasing opportunity costs associated with producing more of good B. 
C)  If one moves from choice 3 to choice 4, the opportunity cost of 20 more units of good B is 30 units of good A. 
D)  If one moves from choice 1 to choice 2, the opportunity cost of 20 more units of good B is 10 units of good A. 
E)  All of these 
A)  If one moves from choice 2 to choice 3, the opportunity cost of 20 more units of good B is 20 units of good A. 
B)  There are increasing opportunity costs associated with producing more of good B. 
C)  If one moves from choice 3 to choice 4, the opportunity cost of 20 more units of good B is 30 units of good A. 
D)  If one moves from choice 1 to choice 2, the opportunity cost of 20 more units of good B is 10 units of good A. 
E)  All of these

Question 18

Figure 1.3
  
-In Figure 1.3, which point should society produce at to maximize efficiency?

Accepted Answer

A)  Only point A 
B)  Only point B 
C)  Only point C 
D)  Only point E 
E)  Any point on its PPC 
A)  Only point A 
B)  Only point B 
C)  Only point C 
D)  Only point E 
E)  Any point on its PPC

Question 19

In economics, which of the following is considered as financial capital?

Accepted Answer

A)  Offices and warehouses 
B)  Stocks and bonds 
C)  Machinery 
D)  Factories 
E)  Equipment 
A)  Offices and warehouses 
B)  Stocks and bonds 
C)  Machinery 
D)  Factories 
E)  Equipment

Question 20

According to the text, as compared to rich countries, most of the poor countries do not fare well because:

Accepted Answer

A)  they have no oil. 
B)  the people in these countries have limited property rights. 
C)  access to education in these countries is very limited. 
D)  high tariffs in these countries prevent international trade. 
E)  they do not have any natural resources. 
A)  they have no oil. 
B)  the people in these countries have limited property rights. 
C)  access to education in these countries is very limited. 
D)  high tariffs in these countries prevent international trade. 
E)  they do not have any natural resources.

Villagers in Xiaogang, China, produced more rice than those in surrounding villages because:

Scarcity:

Specialization according to comparative advantage, followed by trade, allows everyone to acquire more of the goods they want.

Opportunity cost:

A limitation one faces when shopping for clothes is the amount of time available to shop.

Opportunity cost is best defined as the:

To say that there is a scarcity of gold means that:

Choices must be made because of scarcity; people do not have enough time or money to get everything they want.

Economics is the study of:

According to economic analysis, while making a decision, an individual compares the benefits expected from one option with the benefits expected from other options.

Which of the following should not be considered as an opportunity cost of attending college?

An economy's resources:

A positive (non-zero) price for a good means there is a surplus of that good.

Table 1.4 -Assume that our national economy is operating at a point on its bowed-out production possibilities curve. According to the production possibilities schedule in Table 1.4, if our nation produces more of Good A, then:

Figure 1.3 -In Figure 1.3, underutilization of resources is represented by point:

Table 1.4 -According to the production possibilities schedule in Table 1.4, which of the following statements is true?

Figure 1.3 -In Figure 1.3, which point should society produce at to maximize efficiency?

In economics, which of the following is considered as financial capital?

According to the text, as compared to rich countries, most of the poor countries do not fare well because:

Scarcity and Opportunity Costs

The Market and Price System

The Aggregate Economy

National Income Accounting

An Introduction to the Foreign Exchapterange Market and the Balance of Payments

Unemployment and Inflation

Macroeconomic Equilibrium: Aggregate Demand and Supply

Aggregate Expenditures

Income and Expenditures Equilibrium

Fiscal Policy

Money and Banking

Monetary Policy

Macroeconomic Policy: Tradeoffs, Expectations, Credibility, and Sources of Business Cycles

Macroeconomic Viewpoints: New Keynesian, Monetarist, and New Classical

Economic Growth

Development Economics

Globalization

World Trade Equilibrium

International Trade Restrictions

Exchapterange Rates and Financial Links Between Countries

Filters

Exam 1: The Wealth of Nations: Ownership and Economic Freedom

Villagers in Xiaogang, China, produced more rice than those in surrounding villages because:

Scarcity:

Specialization according to comparative advantage, followed by trade, allows everyone to acquire more of the goods they want.

Opportunity cost:

A limitation one faces when shopping for clothes is the amount of time available to shop.

Opportunity cost is best defined as the:

To say that there is a scarcity of gold means that:

Choices must be made because of scarcity; people do not have enough time or money to get everything they want.

Economics is the study of:

According to economic analysis, while making a decision, an individual compares the benefits expected from one option with the benefits expected from other options.

Which of the following should not be considered as an opportunity cost of attending college?

An economy's resources:

A positive (non-zero) price for a good means there is a surplus of that good.

Table 1.4 -Assume that our national economy is operating at a point on its bowed-out production possibilities curve. According to the production possibilities schedule in Table 1.4, if our nation produces more of Good A, then:

Figure 1.3 -In Figure 1.3, underutilization of resources is represented by point:

Table 1.4 -According to the production possibilities schedule in Table 1.4, which of the following statements is true?

Figure 1.3 -In Figure 1.3, which point should society produce at to maximize efficiency?

In economics, which of the following is considered as financial capital?

According to the text, as compared to rich countries, most of the poor countries do not fare well because:

Scarcity and Opportunity Costs

The Market and Price System

The Aggregate Economy

National Income Accounting

An Introduction to the Foreign Exchapterange Market and the Balance of Payments

Unemployment and Inflation

Macroeconomic Equilibrium: Aggregate Demand and Supply

Aggregate Expenditures

Income and Expenditures Equilibrium

Fiscal Policy

Money and Banking

Monetary Policy

Macroeconomic Policy: Tradeoffs, Expectations, Credibility, and Sources of Business Cycles

Macroeconomic Viewpoints: New Keynesian, Monetarist, and New Classical

Economic Growth

Development Economics

Globalization

World Trade Equilibrium

International Trade Restrictions

Exchapterange Rates and Financial Links Between Countries

Filters