Exam 1: The Economic Problem

The graph below is Mendork's production possibility curve for the only two goods that it produces-quirks and quarks. -Refer to the graph above to answer this question.What is the opportunity cost of producing the first 700 quarks?

What term is used to describe the way that the various factors of production are combined to obtain output?

What do economists assume is true about human wants?

What can we say is true as a result of people engaging in voluntary trade?

Below are some production possibilities data for the mystical land of Ghandor. -Refer to the information above to answer this question.What is the opportunity cost of producing the third unit of Arrows?

Which of the following terms describes the next best alternative that must be sacrificed as a result of making a particular choice?

Which of the following is an alternative for the term,"factors of production"?

Figure 1.13 shows Mendork's production possibility curve for the only two goods that it produces-guns and butter. -Refer to Figure 1.13 to answer this question.What is the opportunity cost of one more tonne of butter as output changes from point b to a?

Figure 1.13 shows Mendork's production possibility curve for the only two goods that it produces-guns and butter. -Refer to Figure 1.13 to answer this question.Which of the following statements is correct if Mendork is currently producing 5 tonnes of butter and 8 guns?

The graph below is Mendork's production possibility curve for the only two goods that it produces-quirks and quarks. -Refer to the graph above to answer this question.Which of the following statements is correct if Mendork is currently producing 500 quarks and 8 quirks?

Below are some production possibilities data for the mystical land of Ghandor. -Refer to the information above to answer this question.Suppose that Ghandor is currently producing combination A. What is the opportunity cost of producing 4 units of Arrows.

Explain how microeconomics differs from macroeconomics and then categorize the following questions as either microeconomic or macroeconomic questions: (a)How will interest rates change when the Federal Reserve Bank increases the money supply? (b)How will Nike's share of the market change when Reebok increases their marketing expenditures? (c)How does a tariff on imported steel affect the U.S.steel industry? (d)Should Wal-Mart renovate its stores nationwide? (e)Should the government lower income taxes to stimulate consumption?

What do economists mean when they say that the economy faces scarcity?

All of the following,except one,are capital goods.Which is the exception?

What is the opportunity cost of a particular product?

What do economists always do when they are constructing theories or models?

Below is a production possibilities curve involving tea and videos. -Refer to the graph above to answer this question.Assume that the economy is producing on PPI at point A. After the shift from PPI to PPII,what does point B represent?

The following table shows the production possibilities for the country of Erewhon: -Refer to the table above to answer this question.Erewhon is producing 21 units of wine,approximately how many units of cheese can it produce?

Below is the production possibilities table for the country of Lavaland. (a)Use the information in the Table to draw the production possibilities curve (PP1)for Lavaland.Put tanks on the horizontal axis. (b)What is the cost to Lavaland of moving from point A to point B on its PP1? (c)What is the cost to Lavaland of moving from point E to point F? (d)What general economic principle is being illustrated by your answers to part (b)and (c)above? Explain.

Ensuring the right type of products are produced is referred to as _________ efficiency.