Question 1

-In the above figure, as more ukuleles are produced, the opportunity cost in terms of guitars is

Accepted Answer

A) decreasing. 
B) increasing. 
C) constant. 
D) zero. 
A) decreasing. 
B) increasing. 
C) constant. 
D) zero.

Question 2

-Refer to the above figure. We are currently producing at point c. Which of the following statements is TRUE?

Accepted Answer

A) Resources are not being efficiently utilized. 
B) Resources are being efficiently utilized. 
C) The only way to produce more of Goods X or Y is to have an increase in the amount of resources. 
D) The Law of Increasing Additional Cost does not hold. 
A) Resources are not being efficiently utilized. 
B) Resources are being efficiently utilized. 
C) The only way to produce more of Goods X or Y is to have an increase in the amount of resources. 
D) The Law of Increasing Additional Cost does not hold.

Question 3

A student has a job that pays a wage rate of $10 per hour. The night before an economics exam, the student has set aside four hours to study for the exam, estimating that for each hour spent studying, her grade will rise by 5 points. That night, she gets a call from her employer to come to work for a wage rate of $15 per hour for that night. She decides to work for three hours and earn an extra $45.00. The next day she takes the test and gets a grade of 75. The opportunity cost for her work is

Accepted Answer

A) the $45.00 she earned. 
B) the 15 extra points she estimates that she could have earned on the exam if she had studied the extra three hours. 
C) the three hours she did not study. 
D) the entire four hours she set aside for studying. 
A) the $45.00 she earned. 
B) the 15 extra points she estimates that she could have earned on the exam if she had studied the extra three hours. 
C) the three hours she did not study. 
D) the entire four hours she set aside for studying.

Question 4

Generally, specialization leads to

Accepted Answer

A) constant opportunity costs. 
B) greater productivity. 
C) the production of fewer capital goods. 
D) greater self-reliance. 
A) constant opportunity costs. 
B) greater productivity. 
C) the production of fewer capital goods. 
D) greater self-reliance.

Question 5

-Refer to the above figure. A farmer has 50 acres of land on which to grow wheat or beans. An acre of land yields 400 bushels of beans or 800 bushels of wheat. Which of the following is a possible combination of beans and wheat that can be grown, assuming the land is farmed efficiently?

Accepted Answer

A) 30,000 bushels of each 
B) 15,000 bushels of beans and 10,000 bushels of wheat 
C) 25,000 bushels of beans and 25,000 bushels of wheat 
D) 20,000 bushels of beans and 40,000 bushels of wheat 
A) 30,000 bushels of each 
B) 15,000 bushels of beans and 10,000 bushels of wheat 
C) 25,000 bushels of beans and 25,000 bushels of wheat 
D) 20,000 bushels of beans and 40,000 bushels of wheat

Question 6

-Refer to the above figure. A farmer has 50 acres of land on which to grow wheat or beans. An acre of land yields 400 bushels of beans or 800 bushels of wheat. Which of the following is a possible combination of beans and wheat that can be grown, assuming the land is farmed efficiently?

Accepted Answer

A) 30,000 bushels of each 
B) 20,000 bushels of beans and 40,000 bushels of wheat 
C) 5,000 bushels of beans and 5,000 bushels of wheat 
D) 16,000 bushels of beans and 8,000 bushels of wheat 
A) 30,000 bushels of each 
B) 20,000 bushels of beans and 40,000 bushels of wheat 
C) 5,000 bushels of beans and 5,000 bushels of wheat 
D) 16,000 bushels of beans and 8,000 bushels of wheat

Question 7

What happens to overall living standards when countries trade with other countries?

Accepted Answer

When countries specialize in producing g

Question 8

All points inside the production possibilities curve indicate

Accepted Answer

A) a lack of sufficient supply. 
B) inefficiency in production. 
C) the law of increasing relative cost. 
D) the law of decreasing relative cost. 
A) a lack of sufficient supply. 
B) inefficiency in production. 
C) the law of increasing relative cost. 
D) the law of decreasing relative cost.

Question 9

Opportunity costs arise from

Accepted Answer

A) choices. 
B) taxes. 
C) mistakes. 
D) regrets. 
A) choices. 
B) taxes. 
C) mistakes. 
D) regrets.

Question 10

Economic growth can be pictured in a production possibilities curve diagram by

Accepted Answer

A) shifting the production possibilities curve in. 
B) shifting the production possibilities curve out. 
C) making the production possibilities curve straighter. 
D) moving from a point inside the production possibilities curve to a point on the curve. 
A) shifting the production possibilities curve in. 
B) shifting the production possibilities curve out. 
C) making the production possibilities curve straighter. 
D) moving from a point inside the production possibilities curve to a point on the curve.

Question 11

What is production?
 What economic factors are involved in production?

Accepted Answer

Production involves any activity that co

Question 12

Which of the following is held constant when constructing a production possibilities curve?

Accepted Answer

A) the price level 
B) the income level 
C) combination of goods produced 
D) the amount of total resources used 
A) the price level 
B) the income level 
C) combination of goods produced 
D) the amount of total resources used

Question 13

The conversion of resources into consumer goods or services is called

Accepted Answer

A) human capital. 
B) production. 
C) opportunity cost. 
D) absolute advantage. 
A) human capital. 
B) production. 
C) opportunity cost. 
D) absolute advantage.

Question 14

The president of the United States promises that the nation's economy will simultaneously produce more defense goods without any decreases in the production of other goods. Under which of the following conditions could such a promise be valid?

Accepted Answer

A) if the United States were producing at a point on its production possibilities curve 
B) if the United States were producing inside its production possibilities curve 
C) if the United States were producing to the right of its production possibilities curve 
D) None of the above; the production possibilities curve must shift to the right. 
A) if the United States were producing at a point on its production possibilities curve 
B) if the United States were producing inside its production possibilities curve 
C) if the United States were producing to the right of its production possibilities curve 
D) None of the above; the production possibilities curve must shift to the right.

Question 15

Briefly explain the concept of opportunity cost. What is the opportunity cost of attending college?

Accepted Answer

The opportunity cost of an action is the

Question 16

A typical economic good has which one of the following characteristics?

Accepted Answer

A) The desired quantity exceeds the quantity available at a zero price. 
B) The quantity available exceeds the desired quantity at a zero price. 
C) It uses no resources to produce. 
D) It is never scarce. 
A) The desired quantity exceeds the quantity available at a zero price. 
B) The quantity available exceeds the desired quantity at a zero price. 
C) It uses no resources to produce. 
D) It is never scarce.

Question 17

-In the above figure, how many bushels of corn are produced at point "a"?

Accepted Answer

A) 10,000 
B) 2,500 
C) 1,000 
D) 0 
A) 10,000 
B) 2,500 
C) 1,000 
D) 0

Question 18

If opportunity costs are constant, then

Accepted Answer

A) the production possibilities curve does not exist. 
B) the production possibilities curve bows outward. 
C) the production possibilities curve is a negatively sloped straight line. 
D) factors of production must not be fully employed. 
A) the production possibilities curve does not exist. 
B) the production possibilities curve bows outward. 
C) the production possibilities curve is a negatively sloped straight line. 
D) factors of production must not be fully employed.

Question 19

A friend says, "I really, really need a new car." As an economist, you're thinking

Accepted Answer

A) Right! Everyone needs a new car. 
B) This is an example of how objectively undefinable needs are. Many would argue that this friend could get along just fine with a reliable used car. 
C) If this friend says she needs a new car, then we must all agree that a new car is a need and not just a want. 
D) that a new car can only be considered a need if at least 51% of the public agrees. 
A) Right! Everyone needs a new car. 
B) This is an example of how objectively undefinable needs are. Many would argue that this friend could get along just fine with a reliable used car. 
C) If this friend says she needs a new car, then we must all agree that a new car is a need and not just a want. 
D) that a new car can only be considered a need if at least 51% of the public agrees.

Question 20

-In the above figure, the production of 75 ukuleles and 75 guitars is

Accepted Answer

A) efficient production. 
B) inefficient production. 
C) impossible production. 
D) full employment production. 
A) efficient production. 
B) inefficient production. 
C) impossible production. 
D) full employment production.

-In the above figure, as more ukuleles are produced, the opportunity cost in terms of guitars is

-Refer to the above figure. We are currently producing at point c. Which of the following statements is TRUE?

Generally, specialization leads to

-Refer to the above figure. A farmer has 50 acres of land on which to grow wheat or beans. An acre of land yields 400 bushels of beans or 800 bushels of wheat. Which of the following is a possible combination of beans and wheat that can be grown, assuming the land is farmed efficiently?

-Refer to the above figure. A farmer has 50 acres of land on which to grow wheat or beans. An acre of land yields 400 bushels of beans or 800 bushels of wheat. Which of the following is a possible combination of beans and wheat that can be grown, assuming the land is farmed efficiently?

What happens to overall living standards when countries trade with other countries?

All points inside the production possibilities curve indicate

Opportunity costs arise from

Economic growth can be pictured in a production possibilities curve diagram by

What is production? What economic factors are involved in production?

Which of the following is held constant when constructing a production possibilities curve?

The conversion of resources into consumer goods or services is called

The president of the United States promises that the nation's economy will simultaneously produce more defense goods without any decreases in the production of other goods. Under which of the following conditions could such a promise be valid?

Briefly explain the concept of opportunity cost. What is the opportunity cost of attending college?

A typical economic good has which one of the following characteristics?

-In the above figure, how many bushels of corn are produced at point "a"?

If opportunity costs are constant, then

A friend says, "I really, really need a new car." As an economist, you're thinking

-In the above figure, the production of 75 ukuleles and 75 guitars is

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

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Exam 2: Scarcity and the World of Trade-Offs

-In the above figure, as more ukuleles are produced, the opportunity cost in terms of guitars is

-Refer to the above figure. We are currently producing at point c. Which of the following statements is TRUE?

Generally, specialization leads to

-Refer to the above figure. A farmer has 50 acres of land on which to grow wheat or beans. An acre of land yields 400 bushels of beans or 800 bushels of wheat. Which of the following is a possible combination of beans and wheat that can be grown, assuming the land is farmed efficiently?

-Refer to the above figure. A farmer has 50 acres of land on which to grow wheat or beans. An acre of land yields 400 bushels of beans or 800 bushels of wheat. Which of the following is a possible combination of beans and wheat that can be grown, assuming the land is farmed efficiently?

What happens to overall living standards when countries trade with other countries?

All points inside the production possibilities curve indicate

Opportunity costs arise from

Economic growth can be pictured in a production possibilities curve diagram by

What is production? What economic factors are involved in production?

Which of the following is held constant when constructing a production possibilities curve?

The conversion of resources into consumer goods or services is called

The president of the United States promises that the nation's economy will simultaneously produce more defense goods without any decreases in the production of other goods. Under which of the following conditions could such a promise be valid?

Briefly explain the concept of opportunity cost. What is the opportunity cost of attending college?

A typical economic good has which one of the following characteristics?

-In the above figure, how many bushels of corn are produced at point "a"?

If opportunity costs are constant, then

A friend says, "I really, really need a new car." As an economist, you're thinking

-In the above figure, the production of 75 ukuleles and 75 guitars is

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