Question 1

Specialization and the division of labor typically result in

Accepted Answer

A) cost overruns. 
B) increased output. 
C) decreased output. 
D) a greater reliance upon imports. 
A) cost overruns. 
B) increased output. 
C) decreased output. 
D) a greater reliance upon imports.

Question 2

Which is the best example of specialization?

Accepted Answer

A) a high school math teacher who teaches only calculus 
B) a firm that produces both luggage and cooking oil 
C) a person whose job includes accounting, personnel, and maintenance tasks 
D) a high school math teacher who teaches algebra and calculus 
A) a high school math teacher who teaches only calculus 
B) a firm that produces both luggage and cooking oil 
C) a person whose job includes accounting, personnel, and maintenance tasks 
D) a high school math teacher who teaches algebra and calculus

Question 3

An efficient point of production is

Accepted Answer

A) a point on the production possibilities curve. 
B) a point inside the production possibilities curve. 
C) the point where scarcity no longer exists. 
D) the point where we are currently producing. 
A) a point on the production possibilities curve. 
B) a point inside the production possibilities curve. 
C) the point where scarcity no longer exists. 
D) the point where we are currently producing.

Question 4

Activities designed to convert resources into goods and services is known as

Accepted Answer

A) supply. 
B) consumption. 
C) production. 
D) scarcity. 
A) supply. 
B) consumption. 
C) production. 
D) scarcity.

Question 5

Stephanie has decided to eat lunch between classes. She has ranked her choices, from highest to lowest as, (1)turkey sandwich, (2)tuna sandwich, (3)slice of cheese pizza, (4)cheeseburger. The opportunity cost of the eating turkey sandwich is

Accepted Answer

A) the combined value of the tuna sandwich, slice of cheese pizza and cheeseburger. 
B) the value of tuna sandwich, the next best choice. 
C) the value of the cheeseburger. 
D) zero since she has satisfied a want. 
A) the combined value of the tuna sandwich, slice of cheese pizza and cheeseburger. 
B) the value of tuna sandwich, the next best choice. 
C) the value of the cheeseburger. 
D) zero since she has satisfied a want.

Question 6

A tractor used to prepare land for planting is called

Accepted Answer

A) land. 
B) labor. 
C) physical capital. 
D) human capital. 
A) land. 
B) labor. 
C) physical capital. 
D) human capital.

Question 7

Samia has decided that with the two hours in between classes she can do one of 3 things. She has ranked her choices, from highest to lowest as, (1)chat with her friends, (2)study economics or (3)take a nap. The opportunity cost of chatting with her friends is

Accepted Answer

A) the combined value of studying economics and taking a nap. 
B) the value of studying economics, the next best use of time. 
C) the value of chatting with her friends. 
D) zero since she does not pay her friends to talk to her. 
A) the combined value of studying economics and taking a nap. 
B) the value of studying economics, the next best use of time. 
C) the value of chatting with her friends. 
D) zero since she does not pay her friends to talk to her.

Question 8

It is not uncommon for people to say something like, "If we can put someone on the moon we should be able to . . . ," followed by the person's favorite project. What response can an economist make to this person?

Accepted Answer

Society must make choices, and when it c

Question 9

-Refer to the above figure. Which of the following statements is TRUE?

Accepted Answer

A) Panel A does not represent an economy that is producing efficiently while Panel B does. 
B) Panel A represents an economy that has a lower level of technology than Panel B. 
C) Opportunity costs do not apply to Panel A but apply to Panel B. 
D) In Panel A, equal amounts of Y must be given up to obtain equal increments of X while in Panel B increasingly greater amounts of Y must be given up to obtain equal increments of X. 
A) Panel A does not represent an economy that is producing efficiently while Panel B does. 
B) Panel A represents an economy that has a lower level of technology than Panel B. 
C) Opportunity costs do not apply to Panel A but apply to Panel B. 
D) In Panel A, equal amounts of Y must be given up to obtain equal increments of X while in Panel B increasingly greater amounts of Y must be given up to obtain equal increments of X.

Question 10

If Vice President Smith is a better typist than his assistant, he is said to have a(n)________ advantage in typing over his assistant.

Accepted Answer

A) absolute 
B) unusual 
C) relative 
D) overwhelming 
A) absolute 
B) unusual 
C) relative 
D) overwhelming

Question 11

The production possibilities curve bows out because

Accepted Answer

A) production is efficient. 
B) of the law of increasing additional cost. 
C) production is inefficient. 
D) resources are not being fully utilized. 
A) production is efficient. 
B) of the law of increasing additional cost. 
C) production is inefficient. 
D) resources are not being fully utilized.

Question 12

-The bowed shape of the traditional production possibilities curve reflects the

Accepted Answer

A) negative side effects of economic growth. 
B) fact that not all resources are equally well-suited to producing all goods. 
C) costs of unemployment. 
D) problems of inequality. 
A) negative side effects of economic growth. 
B) fact that not all resources are equally well-suited to producing all goods. 
C) costs of unemployment. 
D) problems of inequality.

Question 13

"Because resources are scarce, the production of more capital goods means that fewer resources are available to produce consumption goods, so there is less current consumption." Do you agree or disagree?
 Explain.

Accepted Answer

Agree. Capital goods are goods that are

Question 14

-Refer to the above figure. Production at Point E

Accepted Answer

A) would indicate that this economy is producing beyond its capabilities. 
B) would indicate production at a level below that which is attainable. 
C) is not attainable with given resources and technology. 
D) would demonstrate a total lack of technical expertise. 
A) would indicate that this economy is producing beyond its capabilities. 
B) would indicate production at a level below that which is attainable. 
C) is not attainable with given resources and technology. 
D) would demonstrate a total lack of technical expertise.

Question 15

The opportunity cost of more consumption of goods today is

Accepted Answer

A) lower consumption of goods in the future. 
B) fewer capital goods in the future. 
C) more capital goods today. 
D) more unemployment both today and in the future. 
A) lower consumption of goods in the future. 
B) fewer capital goods in the future. 
C) more capital goods today. 
D) more unemployment both today and in the future.

Question 16

Why do most people specialize in their work?

Accepted Answer

Most people specialize because

Question 17

If Joey goes surfing for four hours instead of earning $10 per hour for those four hours, his opportunity cost is

Accepted Answer

A) the good time spent surfing. 
B) the cost of gasoline used to get to the beach. 
C) the travel time to the beach. 
D) $40. 
A) the good time spent surfing. 
B) the cost of gasoline used to get to the beach. 
C) the travel time to the beach. 
D) $40.

Question 18

If a person can make $70,000 as an accountant, $60,000 as a chef, $20,000 as a mechanic, and nothing as an opera singer, he or she has a comparative advantage in

Accepted Answer

A) accounting. 
B) being a chef. 
C) being a mechanic. 
D) opera singing. 
A) accounting. 
B) being a chef. 
C) being a mechanic. 
D) opera singing.

Question 19

Are all goods economic goods?
 Are all economic goods also goods?
 Explain.

Accepted Answer

Not all goods are economic goods. Econom

Question 20

Production is efficient when

Accepted Answer

A) it generates a point beyond the production possibility curve. 
B) the maximum output possible is being produced given current levels of resources and technology. 
C) technological change occurs. 
D) the maximum amounts of the most important good are produced. 
A) it generates a point beyond the production possibility curve. 
B) the maximum output possible is being produced given current levels of resources and technology. 
C) technological change occurs. 
D) the maximum amounts of the most important good are produced.

Specialization and the division of labor typically result in

Which is the best example of specialization?

An efficient point of production is

Activities designed to convert resources into goods and services is known as

Stephanie has decided to eat lunch between classes. She has ranked her choices, from highest to lowest as, (1)turkey sandwich, (2)tuna sandwich, (3)slice of cheese pizza, (4)cheeseburger. The opportunity cost of the eating turkey sandwich is

A tractor used to prepare land for planting is called

Samia has decided that with the two hours in between classes she can do one of 3 things. She has ranked her choices, from highest to lowest as, (1)chat with her friends, (2)study economics or (3)take a nap. The opportunity cost of chatting with her friends is

It is not uncommon for people to say something like, "If we can put someone on the moon we should be able to . . . ," followed by the person's favorite project. What response can an economist make to this person?

-Refer to the above figure. Which of the following statements is TRUE?

If Vice President Smith is a better typist than his assistant, he is said to have a(n)________ advantage in typing over his assistant.

The production possibilities curve bows out because

-The bowed shape of the traditional production possibilities curve reflects the

"Because resources are scarce, the production of more capital goods means that fewer resources are available to produce consumption goods, so there is less current consumption." Do you agree or disagree? Explain.

-Refer to the above figure. Production at Point E

The opportunity cost of more consumption of goods today is

Why do most people specialize in their work?

If Joey goes surfing for four hours instead of earning $10 per hour for those four hours, his opportunity cost is

If a person can make $70,000 as an accountant, $60,000 as a chef, $20,000 as a mechanic, and nothing as an opera singer, he or she has a comparative advantage in

Are all goods economic goods? Are all economic goods also goods? Explain.

Production is efficient when

The Nature of Economics

Demand and Supply

Extensions of Demand and Supply Analysis

Public Spending and Public Choice

Funding the Public Sector

The Macroeconomy: Unemployment, Inflation, and Deflation

Global Economic Growth and Development

Real GDP and the Price Level in the Long Run

Classical and Keynesian Macro Analyses

Consumption, Real GDP, and the Multiplier

Fiscal Policy

Deficit Spending and the Public Debt

Money Banking and Central Banking

Domestic and International Dimensions of Monetary Policy

Stabilization in an Integrated World Economy

Policies and Prospects for Global Economic Growth

Comparative Advantage and the Open Economy

Exchange Rates and the Balance of Payments

Filters

Exam 2: Scarcity and the World of Trade-Offs

Specialization and the division of labor typically result in

Which is the best example of specialization?

An efficient point of production is

Activities designed to convert resources into goods and services is known as

Stephanie has decided to eat lunch between classes. She has ranked her choices, from highest to lowest as, (1)turkey sandwich, (2)tuna sandwich, (3)slice of cheese pizza, (4)cheeseburger. The opportunity cost of the eating turkey sandwich is

A tractor used to prepare land for planting is called

Samia has decided that with the two hours in between classes she can do one of 3 things. She has ranked her choices, from highest to lowest as, (1)chat with her friends, (2)study economics or (3)take a nap. The opportunity cost of chatting with her friends is

It is not uncommon for people to say something like, "If we can put someone on the moon we should be able to . . . ," followed by the person's favorite project. What response can an economist make to this person?

-Refer to the above figure. Which of the following statements is TRUE?

If Vice President Smith is a better typist than his assistant, he is said to have a(n)________ advantage in typing over his assistant.

The production possibilities curve bows out because

-The bowed shape of the traditional production possibilities curve reflects the

"Because resources are scarce, the production of more capital goods means that fewer resources are available to produce consumption goods, so there is less current consumption." Do you agree or disagree? Explain.

-Refer to the above figure. Production at Point E

The opportunity cost of more consumption of goods today is

Why do most people specialize in their work?

If Joey goes surfing for four hours instead of earning $10 per hour for those four hours, his opportunity cost is

If a person can make $70,000 as an accountant, $60,000 as a chef, $20,000 as a mechanic, and nothing as an opera singer, he or she has a comparative advantage in

Are all goods economic goods? Are all economic goods also goods? Explain.

Production is efficient when

The Nature of Economics

Demand and Supply

Extensions of Demand and Supply Analysis

Public Spending and Public Choice

Funding the Public Sector

The Macroeconomy: Unemployment, Inflation, and Deflation

Global Economic Growth and Development

Real GDP and the Price Level in the Long Run

Classical and Keynesian Macro Analyses

Consumption, Real GDP, and the Multiplier

Fiscal Policy

Deficit Spending and the Public Debt

Money Banking and Central Banking

Domestic and International Dimensions of Monetary Policy

Stabilization in an Integrated World Economy

Policies and Prospects for Global Economic Growth

Comparative Advantage and the Open Economy

Exchange Rates and the Balance of Payments

Filters