Question 1

Economies MUST experience both booms and busts.All economists can do is work to limit the extent of the economic fluctuations.

Accepted Answer

A) True 
 B)False

Question 2

Why do airlines sometimes advertise last-minute airline ticket sales at low prices? What economic principle are they applying?

Accepted Answer

The airlines are engaging in marginal th

Question 3

The opportunity cost of attending college includes tuition,room and board,cost of meals,and the lost opportunity to make money at a job.

Accepted Answer

A) True 
 B)False

Question 4

Greater emphasis on self-sufficiency and trading less with foreign countries would increase incomes and living standards in the United States.

Accepted Answer

A) True 
 B)False

Question 5

Adam Smith sought to explain the concept of aligning self-interest with the promotion of society's overall interest by:

Accepted Answer

A)  using an analysis of wealth as productivity. 
B)  suggesting markets are led by an invisible hand. 
C)  arguing that markets were ineffective institutions. 
D)  suggesting that government increase regulations. 
A)  using an analysis of wealth as productivity. 
B)  suggesting markets are led by an invisible hand. 
C)  arguing that markets were ineffective institutions. 
D)  suggesting that government increase regulations.

Question 6

Understanding economic growth is one of the most important tasks of economics.

Accepted Answer

A) True 
 B)False

Question 7

Economists think that noone is ever self-interested.

Accepted Answer

A) True 
 B)False

Question 8

Patterns of specialization and trade are explained by:

Accepted Answer

A)  the principle of comparative advantage. 
B)  the principle of absolute advantage. 
C)  people's productivity. 
D)  government control and regulation. 
A)  the principle of comparative advantage. 
B)  the principle of absolute advantage. 
C)  people's productivity. 
D)  government control and regulation.

Question 9

Each of the following ideas is central to economics,EXCEPT:

Accepted Answer

A)  "good institutions can eliminate economic trade-offs." 
B)  "people react to incentives." 
C)  "specialization and trade benefit everyone." 
D)  "prices rise when the government prints too much money." 
A)  "good institutions can eliminate economic trade-offs." 
B)  "people react to incentives." 
C)  "specialization and trade benefit everyone." 
D)  "prices rise when the government prints too much money."

Question 10

Why do you think researchers sometimes find a positive relationship between the unemployment rate and college enrollment rates?

Accepted Answer

A)  The opportunity cost of attending college rises during economic booms,leading to higher college enrollment rates. 
B)  The opportunity cost of attending college rises during recessions,leading to higher college enrollment rates. 
C)  The opportunity cost of attending college falls during recessions,leading to higher college enrollment rates. 
D)  The opportunity cost of attending college falls during economic booms,leading to higher college enrollment rates. 
A)  The opportunity cost of attending college rises during economic booms,leading to higher college enrollment rates. 
B)  The opportunity cost of attending college rises during recessions,leading to higher college enrollment rates. 
C)  The opportunity cost of attending college falls during recessions,leading to higher college enrollment rates. 
D)  The opportunity cost of attending college falls during economic booms,leading to higher college enrollment rates.

Question 11

The better Martha Stewart is at running her business:

Accepted Answer

A)  the higher her opportunity cost of ironing her own shirts. 
B)  the lower her opportunity cost of ironing her own shirts. 
C)  the more it makes sense for her to iron her own shirts,because she will have more time. 
D)  the more it makes sense for her to spend her time away from her business. 
A)  the higher her opportunity cost of ironing her own shirts. 
B)  the lower her opportunity cost of ironing her own shirts. 
C)  the more it makes sense for her to iron her own shirts,because she will have more time. 
D)  the more it makes sense for her to spend her time away from her business.

Question 12

There are ten Big Ideas in Chapter 1.List four of them.

Accepted Answer

A student could list any of the followin

Question 13

Research spearheaded by Dr.Norman Borlaug in the 1950s and 1960s helped develop high-yield wheat that is now in use all over the world.It was so successful that some credit Borlaug with saving more than one billion people from dying of starvation.What quality do ideas have that makes this claim so credible?

Accepted Answer

A)  They don't require many resources to develop,just careful thought. 
B)  They create incentives,transform human behavior,and allow people to pursue their own self-interest. 
C)  They are intangible,allowing them to easily be improved upon. 
D)  They aren't depleted when they are used,allowing them to spread quickly and without limit. 
A)  They don't require many resources to develop,just careful thought. 
B)  They create incentives,transform human behavior,and allow people to pursue their own self-interest. 
C)  They are intangible,allowing them to easily be improved upon. 
D)  They aren't depleted when they are used,allowing them to spread quickly and without limit.

Economies MUST experience both booms and busts.All economists can do is work to limit the extent of the economic fluctuations.

Why do airlines sometimes advertise last-minute airline ticket sales at low prices? What economic principle are they applying?

The opportunity cost of attending college includes tuition,room and board,cost of meals,and the lost opportunity to make money at a job.

Greater emphasis on self-sufficiency and trading less with foreign countries would increase incomes and living standards in the United States.

Adam Smith sought to explain the concept of aligning self-interest with the promotion of society's overall interest by:

Understanding economic growth is one of the most important tasks of economics.

Economists think that noone is ever self-interested.

Patterns of specialization and trade are explained by:

Each of the following ideas is central to economics,EXCEPT:

Why do you think researchers sometimes find a positive relationship between the unemployment rate and college enrollment rates?

The better Martha Stewart is at running her business:

There are ten Big Ideas in Chapter 1.List four of them.

The Power of Trade

Supply and Demand

Equilibrium- How Supply and Demand

Price Ceilings and Floors

GDP and the Measurement of Progress

The Wealth of Nations and Economic Growth

Growth,capital Accumulation

Saving,investment,and the Financial System

Stock Markets and Personal Finance

Unemployment and Labor Force Participation

Inflation and the Quantity Theory of Money

Business Fluctuations

Transmission and Amplification Mechanisms

The Federal Reserve System

Monetary Policy

The Federal Budget- Taxes and Spending

Fiscal Policy

International Trade

International Finance

Political Economy and Public Choice

Filters

Exam 1: The Big Ideas

Economies MUST experience both booms and busts.All economists can do is work to limit the extent of the economic fluctuations.

Why do airlines sometimes advertise last-minute airline ticket sales at low prices? What economic principle are they applying?

The opportunity cost of attending college includes tuition,room and board,cost of meals,and the lost opportunity to make money at a job.

Greater emphasis on self-sufficiency and trading less with foreign countries would increase incomes and living standards in the United States.

Adam Smith sought to explain the concept of aligning self-interest with the promotion of society's overall interest by:

Understanding economic growth is one of the most important tasks of economics.

Economists think that noone is ever self-interested.

Patterns of specialization and trade are explained by:

Each of the following ideas is central to economics,EXCEPT:

Why do you think researchers sometimes find a positive relationship between the unemployment rate and college enrollment rates?

The better Martha Stewart is at running her business:

There are ten Big Ideas in Chapter 1.List four of them.

The Power of Trade

Supply and Demand

Equilibrium- How Supply and Demand

Price Ceilings and Floors

GDP and the Measurement of Progress

The Wealth of Nations and Economic Growth

Growth,capital Accumulation

Saving,investment,and the Financial System

Stock Markets and Personal Finance

Unemployment and Labor Force Participation

Inflation and the Quantity Theory of Money

Business Fluctuations

Transmission and Amplification Mechanisms

The Federal Reserve System

Monetary Policy

The Federal Budget- Taxes and Spending

Fiscal Policy

International Trade

International Finance

Political Economy and Public Choice

Filters