Question 1

The opportunity cost of going to college full time away from home includes

Accepted Answer

A) the income you could have earned from a full-time job. 
B) the funds you would have saved if you had not paid the tuition. 
C) the time you could have spent with friends back home. 
D) All of the above are correct. 
A) the income you could have earned from a full-time job. 
B) the funds you would have saved if you had not paid the tuition. 
C) the time you could have spent with friends back home. 
D) All of the above are correct.

Question 2

To an economist, the term "needs"

Accepted Answer

A) means the purchase of necessary goods. 
B) is objectively undefinable. 
C) identifies the purchases of basic goods and services. 
D) refers to the purchase of goods by the poor. 
A) means the purchase of necessary goods. 
B) is objectively undefinable. 
C) identifies the purchases of basic goods and services. 
D) refers to the purchase of goods by the poor.

Question 3

An improvement in technology will shift the production possibilities curve

Accepted Answer

A) to the left. 
B) along the curve. 
C) inward. 
D) to the right. 
A) to the left. 
B) along the curve. 
C) inward. 
D) to the right.

Question 4

All of the following are assumptions of the production possibilities curve EXCEPT

Accepted Answer

A) resources are fully employed. 
B) there is a fixed time period. 
C) there is a fixed level of technology. 
D) there is a fixed demand for the products. 
A) resources are fully employed. 
B) there is a fixed time period. 
C) there is a fixed level of technology. 
D) there is a fixed demand for the products.

Question 5

Opportunity cost is best defined as

Accepted Answer

A) the sum of the dollar values of all alternatives given up when choices are made. 
B) the cost of producing the purchased goods. 
C) the next highest valued alternative when a choice is made. 
D) the dollar price of the purchased item. 
A) the sum of the dollar values of all alternatives given up when choices are made. 
B) the cost of producing the purchased goods. 
C) the next highest valued alternative when a choice is made. 
D) the dollar price of the purchased item.

Question 6

The production possibilities curve can shift inward when

Accepted Answer

A) production increases. 
B) employment increases. 
C) the stock of productive capital rises. 
D) a country experiences a natural disaster. 
A) production increases. 
B) employment increases. 
C) the stock of productive capital rises. 
D) a country experiences a natural disaster.

Question 7

The production possibilities curve represents

Accepted Answer

A) the maximum amount of labor and capital available to society. 
B) the combinations of goods and services among which consumers are indifferent. 
C) the maximum combination of goods and services that can be produced with fixed resources and technology, given efficient use of the resources. 
D) the maximum rate of growth of capital and labor in a country. 
A) the maximum amount of labor and capital available to society. 
B) the combinations of goods and services among which consumers are indifferent. 
C) the maximum combination of goods and services that can be produced with fixed resources and technology, given efficient use of the resources. 
D) the maximum rate of growth of capital and labor in a country.

Question 8

Why is efficiency desirable?

Accepted Answer

A) It results in an equal distribution of income. 
B) It results in zero unemployment. 
C) It makes best use of the finite resources we have. 
D) It is the most politically popular solution. 
A) It results in an equal distribution of income. 
B) It results in zero unemployment. 
C) It makes best use of the finite resources we have. 
D) It is the most politically popular solution.

Question 9

Technology

Accepted Answer

A) is constantly changing at every point along a production possibilities curve. 
B) is the recipe for combining land, labor, physical capital, and entrepreneurship to produce a good. 
C) does not have an effect on the amount of a good a society can produce with its given resources. 
D) only changes if resources change. 
A) is constantly changing at every point along a production possibilities curve. 
B) is the recipe for combining land, labor, physical capital, and entrepreneurship to produce a good. 
C) does not have an effect on the amount of a good a society can produce with its given resources. 
D) only changes if resources change.

Question 10

-Refer to the above figure. If the farmer has 50 acres of land, the farmer is producing at point a, and an acre of land yields 400 bushels of beans or 800 bushels of wheat, how much land is devoted to the production of wheat?

Accepted Answer

A) 8.5 acres 
B) 10 acres 
C) 12.5 acres 
D) 15 acres 
A) 8.5 acres 
B) 10 acres 
C) 12.5 acres 
D) 15 acres

Question 11

Capital goods

Accepted Answer

A) are a special type of consumption goods. 
B) are consumed because they enhance the enjoyment consumers obtain from other goods and services. 
C) are goods used to make consumer goods and services. 
D) lead to inward shifts of a production possibilities curve. 
A) are a special type of consumption goods. 
B) are consumed because they enhance the enjoyment consumers obtain from other goods and services. 
C) are goods used to make consumer goods and services. 
D) lead to inward shifts of a production possibilities curve.

Question 12

Wants

Accepted Answer

A) is another term for needs. 
B) refer to services while needs refer to goods. 
C) is the term used by economists instead of needs because needs are not objectively definable. 
D) are used by economists and refer to the same thing as needs when used by psychologists. 
A) is another term for needs. 
B) refer to services while needs refer to goods. 
C) is the term used by economists instead of needs because needs are not objectively definable. 
D) are used by economists and refer to the same thing as needs when used by psychologists.

Question 13

An example of an entrepreneur would be

Accepted Answer

A) the owner of a new Indian food restaurant. 
B) the cafeteria employee who won the employee of the month award. 
C) a Greyhound bus driver. 
D) the cashier at your local supermarket. 
A) the owner of a new Indian food restaurant. 
B) the cafeteria employee who won the employee of the month award. 
C) a Greyhound bus driver. 
D) the cashier at your local supermarket.

Question 14

The above table shows the daily production possibilities for a nation.
-Given the production possibilities schedule in the above table, a combination of 75 televisions and 60 personal computers

Accepted Answer

A) is attainable but involves the unemployment of some of society's resources. 
B) clearly illustrates the trade-off between televisions and computers. 
C) cannot be produced by society, given its current level of resources and production technology. 
D) can be produced only if society is willing to have some of its resources used inefficiently. 
A) is attainable but involves the unemployment of some of society's resources. 
B) clearly illustrates the trade-off between televisions and computers. 
C) cannot be produced by society, given its current level of resources and production technology. 
D) can be produced only if society is willing to have some of its resources used inefficiently.

Question 15

If individual X has comparative advantage in painting and individual Y has comparative advantage in carpentry, then

Accepted Answer

A) individual X must use fewer hours to paint a fence than individual Y. 
B) individual Y will specialize in painting. 
C) there is a lower opportunity cost (expressed in units of carpentry)for individual X to paint than for individual Y to paint. 
D) specialization will not occur, since each does not have a clear absolute advantage. 
A) individual X must use fewer hours to paint a fence than individual Y. 
B) individual Y will specialize in painting. 
C) there is a lower opportunity cost (expressed in units of carpentry)for individual X to paint than for individual Y to paint. 
D) specialization will not occur, since each does not have a clear absolute advantage.

Question 16

At a point on a production possibilities curve, opportunity cost of more capital goods today is

Accepted Answer

A) fewer capital goods in the future. 
B) fewer consumer goods in the future. 
C) fewer consumer goods today. 
D) more unemployed resources in the future. 
A) fewer capital goods in the future. 
B) fewer consumer goods in the future. 
C) fewer consumer goods today. 
D) more unemployed resources in the future.

Question 17

For a country that produces two goods: Environmental clean-up goods and space program goods. What economic information is contained in its production possibility curve?

Accepted Answer

@#IMG-DLM& The above figure illustrates the produc

Question 18

The reason the production possibilities curve is bowed outward (concave)is

Accepted Answer

A) the law of increasing additional cost. 
B) that technology is constantly changing. 
C) that the number of resources is increasing. 
D) that the economy has more capital goods than entrepreneurial effort. 
A) the law of increasing additional cost. 
B) that technology is constantly changing. 
C) that the number of resources is increasing. 
D) that the economy has more capital goods than entrepreneurial effort.

Question 19

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

Accepted Answer

A) a fixed amount of resources 
B) the efficient use of resources 
C) resources of a given quality 
D) All of the above are correct. 
A) a fixed amount of resources 
B) the efficient use of resources 
C) resources of a given quality 
D) All of the above are correct.

Question 20

Opportunity cost is

Accepted Answer

A) the intrinsic value of an economic good. 
B) the total value of all the alternatives given up when a choice is made. 
C) the value of the opportunity selected when a need is satisfied. 
D) the value of the next highest ranked alternative that must be sacrificed to obtain a want. 
A) the intrinsic value of an economic good. 
B) the total value of all the alternatives given up when a choice is made. 
C) the value of the opportunity selected when a need is satisfied. 
D) the value of the next highest ranked alternative that must be sacrificed to obtain a want.

The opportunity cost of going to college full time away from home includes

To an economist, the term "needs"

An improvement in technology will shift the production possibilities curve

All of the following are assumptions of the production possibilities curve EXCEPT

Opportunity cost is best defined as

The production possibilities curve can shift inward when

The production possibilities curve represents

Why is efficiency desirable?

Technology

-Refer to the above figure. If the farmer has 50 acres of land, the farmer is producing at point a, and an acre of land yields 400 bushels of beans or 800 bushels of wheat, how much land is devoted to the production of wheat?

Capital goods

Wants

An example of an entrepreneur would be

The above table shows the daily production possibilities for a nation. -Given the production possibilities schedule in the above table, a combination of 75 televisions and 60 personal computers

If individual X has comparative advantage in painting and individual Y has comparative advantage in carpentry, then

At a point on a production possibilities curve, opportunity cost of more capital goods today is

For a country that produces two goods: Environmental clean-up goods and space program goods. What economic information is contained in its production possibility curve?

The reason the production possibilities curve is bowed outward (concave)is

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

Opportunity cost 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

Exam 2: Scarcity and the World of Trade-Offs

The opportunity cost of going to college full time away from home includes

To an economist, the term "needs"

An improvement in technology will shift the production possibilities curve

All of the following are assumptions of the production possibilities curve EXCEPT

Opportunity cost is best defined as

The production possibilities curve can shift inward when

The production possibilities curve represents

Why is efficiency desirable?

Technology

-Refer to the above figure. If the farmer has 50 acres of land, the farmer is producing at point a, and an acre of land yields 400 bushels of beans or 800 bushels of wheat, how much land is devoted to the production of wheat?

Capital goods

Wants

An example of an entrepreneur would be

The above table shows the daily production possibilities for a nation. -Given the production possibilities schedule in the above table, a combination of 75 televisions and 60 personal computers

If individual X has comparative advantage in painting and individual Y has comparative advantage in carpentry, then

At a point on a production possibilities curve, opportunity cost of more capital goods today is

For a country that produces two goods: Environmental clean-up goods and space program goods. What economic information is contained in its production possibility curve?

The reason the production possibilities curve is bowed outward (concave)is

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

Opportunity cost 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