Exam 1: Ten Principles of Economics

In a particular country in 2000,the average worker needed to work 40 hours to produce 55 units of output.In that same country in 2008,the average worker needed to work 30 hours to produce 45 units of output.In that country,the productivity of the average worker

Economics is the study of how society allocates its unlimited resources.

The term "market failure"

Which of the following is correct?

Which of the following statements about markets is most accurate?

In the former Soviet Union,producers were paid for meeting output targets,not for selling products.Under those circumstances,what were the economic incentives for producers?

Based on the available evidence,which of the following groups benefits most from mandatory seat belt laws?

To say that government intervenes in the economy to promote efficiency is to say that government is attempting to

A rational decisionmaker takes an action if and only if

Mitch has $100 to spend and wants to buy either a new amplifier for his guitar or a new mp3 player to listen to music while working out.Both the amplifier and the mp3 player cost $100,so he can only buy one.This illustrates the basic concept that

Efficiency means everyone in the economy should receive an equal share of the goods and services produced.

An increase in the marginal cost of an activity necessarily means that people will no longer engage in any of that activity.

Government policies can change the costs and benefits that people face.Those policies have the potential to

Which of the following firms is likely to have the greatest market power?

Which of the following is an example of an externality?

For which of the following individuals would the opportunity cost of going to college be highest?

In an economy in which decisions are guided by prices and individual self-interest,there is

The tradeoff between inflation and unemployment

Efficiency means that

Market failure can be caused by