Question 1

What is an example of an economic model?

Accepted Answer

A) Opportunity costs. 
B) Scarcity of resources. 
C) Positive statements. 
D) Production possibilities curve. 
A) Opportunity costs. 
B) Scarcity of resources. 
C) Positive statements. 
D) Production possibilities curve.

Question 2

Which of the following statements describes the law of increasing costs?

Accepted Answer

A) As the economy's production level of any particular item decreases,its opportunity cost rises. 
B) As the economy's production level of any particular item increases,its opportunity cost rises. 
C) The prices of consumer goods always rise and never fall. 
D) If someone waits to make a purchase,she will pay a higher price. 
E) The total cost of production rises as output goes up. 
A) As the economy's production level of any particular item decreases,its opportunity cost rises. 
B) As the economy's production level of any particular item increases,its opportunity cost rises. 
C) The prices of consumer goods always rise and never fall. 
D) If someone waits to make a purchase,she will pay a higher price. 
E) The total cost of production rises as output goes up.

Question 3

What is fundamental question is implied by the following statement: Social policies are needed to ensure that no individual lives in poverty.

Accepted Answer

A) What to produce? 
B) How to produce? 
C) For whom? 
D) How much competition? 
E) How much command? 
A) What to produce? 
B) How to produce? 
C) For whom? 
D) How much competition? 
E) How much command?

Question 4

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

Accepted Answer

A) One person gains and the other loses. 
B) One person gains while there is a neutral effect on the other person. 
C) Both people gain. 
D) Neither person gains. 
A) One person gains and the other loses. 
B) One person gains while there is a neutral effect on the other person. 
C) Both people gain. 
D) Neither person gains.

Question 5

What do most of the disagreements among economists involve?

Accepted Answer

A) The appropriate goals and policies for the economy. 
B) Generalizing about facts. 
C) Gathering data. 
D) The use of statistics. 
E) The use of mathematics. 
A) The appropriate goals and policies for the economy. 
B) Generalizing about facts. 
C) Gathering data. 
D) The use of statistics. 
E) The use of mathematics.

Question 6

Productivity refers to which type of efficiency?

Accepted Answer

Productive

Question 7

What are the three fundamental questions in economics?

Accepted Answer

A) What to produce,how to produce it,and for whom is it produced. 
B) Is it necessary,is it right,and is it valuable? 
C) Who should produce,what is the right way to produce,and how should we decide? 
D) What to produce,how to produce it,and who should produce it. 
A) What to produce,how to produce it,and for whom is it produced. 
B) Is it necessary,is it right,and is it valuable? 
C) Who should produce,what is the right way to produce,and how should we decide? 
D) What to produce,how to produce it,and who should produce it.

Question 8

Below is a production possibilities curve involving tea and videos.
  
-Refer to the graph above to answer this question.Assume that the economy is facing PPI and that 2,000 tons of tea are produced,how many videos could be produced?

Accepted Answer

A) 600,000. 
B) 500,000. 
C) 2,000. 
D) 0. 
A) 600,000. 
B) 500,000. 
C) 2,000. 
D) 0.

Question 9

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?

Accepted Answer

A) This society is using competition to coordinate its economic activities. 
B) This society is experiencing either unemployment or inefficiency. 
C) This economy is experiencing full employment. 
D) This society is not adequately answering the "for whom" question. 
E) This economy is growing quickly. 
A) This society is using competition to coordinate its economic activities. 
B) This society is experiencing either unemployment or inefficiency. 
C) This economy is experiencing full employment. 
D) This society is not adequately answering the "for whom" question. 
E) This economy is growing quickly.

Question 10

Which of the following was argued by John Stuart Mill?

Accepted Answer

A) It is ideas,not vested interests,which are dangerous for good and evil. 
B) The distribution of money is dictated by the pattern of resource use. 
C) As technology changes,what is produced also necessarily changes. 
D) Society can intervene in any fashion that it may wish to redistribute income. 
A) It is ideas,not vested interests,which are dangerous for good and evil. 
B) The distribution of money is dictated by the pattern of resource use. 
C) As technology changes,what is produced also necessarily changes. 
D) Society can intervene in any fashion that it may wish to redistribute income.

Question 11

Below is a production possibilities curve involving tea and videos.
  
-Refer to the graph above to answer this question.Which of the following illustrates the law of increasing costs?

Accepted Answer

A) Any point outside the production possibilities curve. 
B) A "bowed-out" production possibilities curve. 
C) A straight-line production possibilities curve. 
D) Any point inside the production possibilities curve. 
A) Any point outside the production possibilities curve. 
B) A "bowed-out" production possibilities curve. 
C) A straight-line production possibilities curve. 
D) Any point inside the production possibilities curve.

Question 12

The following table shows the production possibilities for the country of Erewhon:
  
-Refer to the table above to answer this question.What is the total cost of producing the first 10 units of wine?

Accepted Answer

A) 6 units of cheese 
B) 12 units of cheese 
C) 24 units of cheese 
D) 28 units of cheese 
A) 6 units of cheese 
B) 12 units of cheese 
C) 24 units of cheese 
D) 28 units of cheese

Question 13

Define and give an example of the law of increasing costs.

Accepted Answer

The law of increasing costs states that

Question 14

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

Accepted Answer

A) There are fewer resources available than there were in the 1960s. 
B) It is quite evident that the world is running out of resources. 
C) The economy is producing far below its capacity to produce. 
D) The resources available are not sufficient to produce all that everyone wants. 
A) There are fewer resources available than there were in the 1960s. 
B) It is quite evident that the world is running out of resources. 
C) The economy is producing far below its capacity to produce. 
D) The resources available are not sufficient to produce all that everyone wants.

Question 15

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

Accepted Answer

A) Opportunity costs. 
B) Types of economies. 
C) Ways of coordinating an economy. 
D) Technology. 
A) Opportunity costs. 
B) Types of economies. 
C) Ways of coordinating an economy. 
D) Technology.

Question 16

The following table shows the production possibilities for producing rice and beans in the country of Aipotu:
  
-Refer to the table above to answer this question.What is the total cost of producing 180 rice?

Accepted Answer

A) 30 beans 
B) 40 beans 
C) 60 beans 
D) 100 beans 
A) 30 beans 
B) 40 beans 
C) 60 beans 
D) 100 beans

Question 17

The maximum production possible in Rome and in Cathay are as follows:
  
-If each country specializes in the production of what it does best and trades with the other,what is the combined output?

Accepted Answer

A) 20 bread and 20 figs. 
B) 30 bread and 30 figs. 
C) 40 bread and 40 figs. 
D) 60 bread and 60 figs. 
A) 20 bread and 20 figs. 
B) 30 bread and 30 figs. 
C) 40 bread and 40 figs. 
D) 60 bread and 60 figs.

Question 18

142.The following graph shows the production possibilities for the economy of Esher:
a)What is the total cost of producing 7 pops?
b)What is the total cost of producing 4 corns?
c)What is the cost of moving from point b to point c?
Suppose that Esher experiences a 50% increase in the productivity of producing Pops.
d)Draw in the new production possibilities curve labelled PP2.
e)If Esher wants to have 6 pops,how many corn can it now have?
   a)3 corn
b)4 pops
c)2 corn
d)See the following graph:
e)4 corn.
  
-Identify the following statements as either positive (P)or normative (N)and also whether they are microeconomic (MI)or macroeconomic (MA)in nature:
a)The government should impose a maximum on the price of oil.
b)The price of oil in Canada is determined by the market.
c)Economic growth is too low in Canada.
d)The lowest earning 20 percent of the Canadian population earn only 5 percent of the total income.
e)Unemployment is a far more serious problem than inflation.

Accepted Answer

a)N MI
b)P

Question 19

The following table shows the production possibilities for the country of Erewhon:
  
-Refer to the table above to answer this question.What is the total cost of producing the first 10 units of cheese?

Accepted Answer

A) 6 units of wine 
B) 20 units of wine 
C) 24 units of wine 
D) 28 units of wine 
A) 6 units of wine 
B) 20 units of wine 
C) 24 units of wine 
D) 28 units of wine

Question 20

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

Accepted Answer

A) Microeconomics. 
B) Opportunity cost. 
C) Macroeconomics. 
D) The law of increasing costs. 
E) Scarcity. 
A) Microeconomics. 
B) Opportunity cost. 
C) Macroeconomics. 
D) The law of increasing costs. 
E) Scarcity.

What is an example of an economic model?

Which of the following statements describes the law of increasing costs?

What is fundamental question is implied by the following statement: Social policies are needed to ensure that no individual lives in poverty.

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

What do most of the disagreements among economists involve?

Productivity refers to which type of efficiency?

What are the three fundamental questions in economics?

Below is a production possibilities curve involving tea and videos. -Refer to the graph above to answer this question.Assume that the economy is facing PPI and that 2,000 tons of tea are produced,how many videos could be produced?

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?

Which of the following was argued by John Stuart Mill?

Below is a production possibilities curve involving tea and videos. -Refer to the graph above to answer this question.Which of the following illustrates the law of increasing costs?

The following table shows the production possibilities for the country of Erewhon: -Refer to the table above to answer this question.What is the total cost of producing the first 10 units of wine?

Define and give an example of the law of increasing costs.

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

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

The following table shows the production possibilities for producing rice and beans in the country of Aipotu: -Refer to the table above to answer this question.What is the total cost of producing 180 rice?

The maximum production possible in Rome and in Cathay are as follows: -If each country specializes in the production of what it does best and trades with the other,what is the combined output?

The following table shows the production possibilities for the country of Erewhon: -Refer to the table above to answer this question.What is the total cost of producing the first 10 units of cheese?

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

Demand and Supply: an Introduction

Measuring the Economy 1: GDP and Economic Growth

Measuring the Economy 2: Unemployment and Inflation

Aggregate Demand and Supply

Aggregate Expenditures

Fiscal Policy

Money and Banking

The Money Market and Monetary Policy

International Trade

Exchange Rates and the Balance of Payments

Macroeconomic Policy Revisited

A Walk Through the Twentieth Century and Beyond

Filters

Exam 1: The Economic Problem

What is an example of an economic model?

Which of the following statements describes the law of increasing costs?

What is fundamental question is implied by the following statement: Social policies are needed to ensure that no individual lives in poverty.

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

What do most of the disagreements among economists involve?

Productivity refers to which type of efficiency?

What are the three fundamental questions in economics?

Below is a production possibilities curve involving tea and videos. -Refer to the graph above to answer this question.Assume that the economy is facing PPI and that 2,000 tons of tea are produced,how many videos could be produced?

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?

Which of the following was argued by John Stuart Mill?

Below is a production possibilities curve involving tea and videos. -Refer to the graph above to answer this question.Which of the following illustrates the law of increasing costs?

The following table shows the production possibilities for the country of Erewhon: -Refer to the table above to answer this question.What is the total cost of producing the first 10 units of wine?

Define and give an example of the law of increasing costs.

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

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

The following table shows the production possibilities for producing rice and beans in the country of Aipotu: -Refer to the table above to answer this question.What is the total cost of producing 180 rice?

The maximum production possible in Rome and in Cathay are as follows: -If each country specializes in the production of what it does best and trades with the other,what is the combined output?

The following table shows the production possibilities for the country of Erewhon: -Refer to the table above to answer this question.What is the total cost of producing the first 10 units of cheese?

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

Demand and Supply: an Introduction

Measuring the Economy 1: GDP and Economic Growth

Measuring the Economy 2: Unemployment and Inflation

Aggregate Demand and Supply

Aggregate Expenditures

Fiscal Policy

Money and Banking

The Money Market and Monetary Policy

International Trade

Exchange Rates and the Balance of Payments

Macroeconomic Policy Revisited

A Walk Through the Twentieth Century and Beyond

Filters