Question 1

A species of snakes became extinct due to pollution in a river where the snakes once lived. This is an example of

Accepted Answer

A)  a market failure caused by an externality. 
B)  a market failure caused by market power. 
C)  a market failure caused by equality. 
D)  There is no market failure in this case. 
A)  a market failure caused by an externality. 
B)  a market failure caused by market power. 
C)  a market failure caused by equality. 
D)  There is no market failure in this case.

Question 2

The ability of an individual to own and exercise control over scarce resources is called

Accepted Answer

A)  market failure. 
B)  property rights. 
C)  externality. 
D)  market power. 
A)  market failure. 
B)  property rights. 
C)  externality. 
D)  market power.

Question 3

Suppose the cost of flying a 100-seat plane for an airline is $50,000 and there are 10 empty seats on a flight. The average cost per seat is

Accepted Answer

A)  $50. 
B)  $500. 
C)  $50,000. 
D)  This cannot be determined from the information given. 
A)  $50. 
B)  $500. 
C)  $50,000. 
D)  This cannot be determined from the information given.

Question 4

During the early 1920s in Germany, prices

Accepted Answer

A)  doubled annually. 
B)  doubled monthly. 
C)  tripled monthly. 
D)  tripled annually. 
A)  doubled annually. 
B)  doubled monthly. 
C)  tripled monthly. 
D)  tripled annually.

Question 5

Explain how trade with other countries is beneficial.

Accepted Answer

Trade allows countri

Question 6

When calculating the cost of college, which of the following should you probably not include?

Accepted Answer

A)  The cost of tuition 
B)  The cost of books required for college classes 
C)  The income you would have earned had you not gone to college 
D)  The cost of rent for your off-campus apartment. 
A)  The cost of tuition 
B)  The cost of books required for college classes 
C)  The income you would have earned had you not gone to college 
D)  The cost of rent for your off-campus apartment.

Question 7

Which of these activities will most likely impose an external cost?

Accepted Answer

A)  Betty plants flowers in her garden. 
B)  Bonnie gets a flu vaccine. 
C)  Bridget drives her car after having too much alcohol to drink. 
D)  Becky buys a new flat screen television. 
A)  Betty plants flowers in her garden. 
B)  Bonnie gets a flu vaccine. 
C)  Bridget drives her car after having too much alcohol to drink. 
D)  Becky buys a new flat screen television.

Question 8

In a market economy, economic activity is guided by

Accepted Answer

A)  the government. 
B)  corporations. 
C)  central planners. 
D)  self-interest and prices. 
A)  the government. 
B)  corporations. 
C)  central planners. 
D)  self-interest and prices.

Question 9

Trade makes costs

Accepted Answer

A)  higher and reduces the variety of goods and services available. 
B)  higher but raises the variety of goods and services available. 
C)  lower but reduces the variety of goods and services available. 
D)  lower and raises the variety of goods and services available. 
A)  higher and reduces the variety of goods and services available. 
B)  higher but raises the variety of goods and services available. 
C)  lower but reduces the variety of goods and services available. 
D)  lower and raises the variety of goods and services available.

Question 10

When Ukraine trades with Italy,

Accepted Answer

A)  both countries are likely made better off. 
B)  only Italy benefits since Ukraine can produce all goods at a higher level of quality than Italy. 
C)  only Ukraine benefits since Italy's low wages guarantee that Italian firms will be profitable regardless of trade. 
D)  neither country will benefit since Ukraine is more efficient than Italy in the production of all goods. 
A)  both countries are likely made better off. 
B)  only Italy benefits since Ukraine can produce all goods at a higher level of quality than Italy. 
C)  only Ukraine benefits since Italy's low wages guarantee that Italian firms will be profitable regardless of trade. 
D)  neither country will benefit since Ukraine is more efficient than Italy in the production of all goods.

Question 11

Ralph Nader's book Unsafe at Any Speed caused Congress to require

Accepted Answer

A)  safety glass in all new cars. 
B)  seat belts in all new cars. 
C)  air bags in all new cars. 
D)  stricter drunk driving laws in all states. 
A)  safety glass in all new cars. 
B)  seat belts in all new cars. 
C)  air bags in all new cars. 
D)  stricter drunk driving laws in all states.

Question 12

Which of the following products would be considered scarce?

Accepted Answer

A)  bread 
B)  baseballs autographed by Babe Ruth 
C)  motorcycles 
D)  All of the above are correct. 
A)  bread 
B)  baseballs autographed by Babe Ruth 
C)  motorcycles 
D)  All of the above are correct.

Question 13

Explain how an attempt by the government to lower inflation could cause unemployment to increase in the short-run.

Accepted Answer

To lower inflation, the government may c

Question 14

The opportunity cost of going to college is

Accepted Answer

A)  the total spent on food, clothing, books, transportation, tuition, lodging, and other expenses. 
B)  the value of the best opportunity a student gives up to attend college. 
C)  zero for students who are fortunate enough to have all of their college expenses paid by someone else. 
D)  zero, since a college education will allow a student to earn a larger income after graduation. 
A)  the total spent on food, clothing, books, transportation, tuition, lodging, and other expenses. 
B)  the value of the best opportunity a student gives up to attend college. 
C)  zero for students who are fortunate enough to have all of their college expenses paid by someone else. 
D)  zero, since a college education will allow a student to earn a larger income after graduation.

Question 15

Rational people make decisions "at the margin" by comparing .

Accepted Answer

marginal c

Question 16

If the average cost of transporting a passenger on the train from Chicago to St. Louis is $75, it would be irrational for the railroad to allow any passenger to ride for less than $75.

Accepted Answer

A) True 
 B)False

Question 17

Productivity is defined as the

Accepted Answer

A)  amount of goods and services produced from each unit of labor input. 
B)  number of workers required to produce a given amount of goods and services. 
C)  amount of labor that can be saved by replacing workers with machines. 
D)  actual amount of effort workers put into an hour of working time. 
A)  amount of goods and services produced from each unit of labor input. 
B)  number of workers required to produce a given amount of goods and services. 
C)  amount of labor that can be saved by replacing workers with machines. 
D)  actual amount of effort workers put into an hour of working time.

Question 18

Resources are

Accepted Answer

A)  scarce for households but plentiful for economies. 
B)  plentiful for households but scarce for economies. 
C)  scarce for households and scarce for economies. 
D)  plentiful for households and plentiful for economies. 
A)  scarce for households but plentiful for economies. 
B)  plentiful for households but scarce for economies. 
C)  scarce for households and scarce for economies. 
D)  plentiful for households and plentiful for economies.

Question 19

Economics is the study of

Accepted Answer

A)  production methods. 
B)  how society manages its scarce resources. 
C)  how households decide who performs which tasks. 
D)  the interaction of business and government. 
A)  production methods. 
B)  how society manages its scarce resources. 
C)  how households decide who performs which tasks. 
D)  the interaction of business and government.

A species of snakes became extinct due to pollution in a river where the snakes once lived. This is an example of

The ability of an individual to own and exercise control over scarce resources is called

Suppose the cost of flying a 100-seat plane for an airline is $50,000 and there are 10 empty seats on a flight. The average cost per seat is

During the early 1920s in Germany, prices

Explain how trade with other countries is beneficial.

When calculating the cost of college, which of the following should you probably not include?

Which of these activities will most likely impose an external cost?

In a market economy, economic activity is guided by

Trade makes costs

When Ukraine trades with Italy,

Ralph Nader's book Unsafe at Any Speed caused Congress to require

Which of the following products would be considered scarce?

Explain how an attempt by the government to lower inflation could cause unemployment to increase in the short-run.

The opportunity cost of going to college is

Rational people make decisions "at the margin" by comparing .

If the average cost of transporting a passenger on the train from Chicago to St. Louis is $75, it would be irrational for the railroad to allow any passenger to ride for less than $75.

Productivity is defined as the

Resources are

Economics is the study of

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

The Basic Tools of Finance

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

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Exam 1: Ten Principles of Economics

A species of snakes became extinct due to pollution in a river where the snakes once lived. This is an example of

The ability of an individual to own and exercise control over scarce resources is called

Suppose the cost of flying a 100-seat plane for an airline is $50,000 and there are 10 empty seats on a flight. The average cost per seat is

During the early 1920s in Germany, prices

Explain how trade with other countries is beneficial.

When calculating the cost of college, which of the following should you probably not include?

Which of these activities will most likely impose an external cost?

In a market economy, economic activity is guided by

Trade makes costs

When Ukraine trades with Italy,

Ralph Nader's book Unsafe at Any Speed caused Congress to require

Which of the following products would be considered scarce?

Explain how an attempt by the government to lower inflation could cause unemployment to increase in the short-run.

The opportunity cost of going to college is

Rational people make decisions "at the margin" by comparing .

If the average cost of transporting a passenger on the train from Chicago to St. Louis is $75, it would be irrational for the railroad to allow any passenger to ride for less than $75.

Productivity is defined as the

Resources are

Economics is the study of

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

The Basic Tools of Finance

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

Filters