The document discusses key economic concepts including:
1) Economics is the study of how society allocates scarce resources to meet its unlimited wants. Scarcity means human desires exceed available resources.
2) The fundamental economic problem is scarcity of resources relative to human wants. This means societies must choose how to use limited resources to fulfill goals.
3) The production possibilities curve illustrates scarcity and opportunity costs - increasing one good requires reducing another due to finite resources. It curves outward to show greater sacrifice is needed for additional units of a good.
Test Bank for Microeconomics 20th Edition by McConnellriven03
Test Bank for Microeconomics 20th Edition by McConnell
Download: https://goo.gl/MmRaBa
microeconomics principles problems and policies 21st edition
mcconnell brue flynn economics 20th edition pdf
microeconomics 20th edition by mcconnell brue and flynn mcgraw hill irwin
macroeconomics principles problems and policies 20th edition pdf
Solutions manual for economics 4th edition by krugman ibsn 9781464143847Kinicki223
Solutions Manual for Economics 4th Edition by Krugman IBSN 9781464143847
Download at: https://goo.gl/cXtEMa
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economics paul krugman 4th edition pdf
economics paul krugman robin wells 4th edition pdf
paul krugman and robin wells microeconomics 4th edition pdf
essentials of economics 4th edition pdf krugman
economics paul krugman robin wells pdf
paul krugman and robin wells macroeconomics 4th edition pdf
essentials of economics krugman pdf
economics paul krugman 4th edition answers
Refer to the information provided in Figure 2.4 below to answer the .docxlorent8
Refer to the information provided in Figure 2.4 below to answer the questions that follow.
Figure 2.4
Refer to the information provided in Figure 2.5 below to answer the questions that follow.
1) production is the process by which
a) products are used by consumers.
b) resources are transformed into useful forms.
c) products are converted into capital.
d) resources are allocated and distributed.
.
2) Which of the following is a resource as the term is used by economists?
a) buildings
b) labor
c) land
d) all of the above
.
3) Economists refer to things that have already been produced that are in turn used to produce other goods and services as
a) land.
b) labor.
c) entrepreneurship.
d) capital.
.
4) According to the theory of ________, specialization and free trade will benefit all trade partners, even when some are absolutely
more efficient producers than others.
a) comparative advantage
b) absolute advantage
c) social equity
d) laissez-faire
.
5) Specialization and trade exploit differences in productivity across workers and
a) only benefit the exporter.
b) only benefit the importer
c) make everyone better off.
d) make everyone worse off
.
6) If a vintner has a comparative advantage in producing wine
a) he can produce more wine using the same resources than other vintners.
b) wine is the only product he can produce.
c) he can produce wine at a lower opportunity cost than other vintners.
d) he also has an absolute advantage in producing wine.
.
7) Which of the following is an act of economic "investment"?
a) The state legislature authorizes the sale of a state park
b) An entrepreneur buys 5000 shares of stock at $5 a share and then sells the stock at a profit for $60 a share.
c) A manufacturer purchases a new machinery system for his plant.
d) A teacher deposits $500 in a retirement account.
.
8) In economics, the creation of capital is referred to as
a) investment.
b) comparative advantage
c) consumption.
d) allocation.
.
9) When an economy is producing inside its production possibility frontier
a) production inefficiency occurs
b) only technological advances will allow it to increase production
c) it is efficient so long as it is producing what people want.
d) it must overcompensate by producing outside the curve to achieve efficiency.
.
10) According to Figure 2.4, Point A necessarily represents
a) an unattainable production point
b) only hybrid cars being produced
c) the economy's optimal production point.
d) what society wants.
.
11) According to Figure 2.4, Point F
a) is efficient and attainable
b) represents underallocation of resources
c) represents what the people want.
d) cannot be produced with the current state of technology
.
12) According to Figure 2.4, Point E necessarily represents
a) an impossible production point
b) technological advancement
c) overallocation of resources
d) only motorcycle.
Test Bank for Microeconomics 20th Edition by McConnellriven03
Test Bank for Microeconomics 20th Edition by McConnell
Download: https://goo.gl/MmRaBa
microeconomics principles problems and policies 21st edition
mcconnell brue flynn economics 20th edition pdf
microeconomics 20th edition by mcconnell brue and flynn mcgraw hill irwin
macroeconomics principles problems and policies 20th edition pdf
Solutions manual for economics 4th edition by krugman ibsn 9781464143847Kinicki223
Solutions Manual for Economics 4th Edition by Krugman IBSN 9781464143847
Download at: https://goo.gl/cXtEMa
People also search:
economics paul krugman 4th edition pdf
economics paul krugman robin wells 4th edition pdf
paul krugman and robin wells microeconomics 4th edition pdf
essentials of economics 4th edition pdf krugman
economics paul krugman robin wells pdf
paul krugman and robin wells macroeconomics 4th edition pdf
essentials of economics krugman pdf
economics paul krugman 4th edition answers
Refer to the information provided in Figure 2.4 below to answer the .docxlorent8
Refer to the information provided in Figure 2.4 below to answer the questions that follow.
Figure 2.4
Refer to the information provided in Figure 2.5 below to answer the questions that follow.
1) production is the process by which
a) products are used by consumers.
b) resources are transformed into useful forms.
c) products are converted into capital.
d) resources are allocated and distributed.
.
2) Which of the following is a resource as the term is used by economists?
a) buildings
b) labor
c) land
d) all of the above
.
3) Economists refer to things that have already been produced that are in turn used to produce other goods and services as
a) land.
b) labor.
c) entrepreneurship.
d) capital.
.
4) According to the theory of ________, specialization and free trade will benefit all trade partners, even when some are absolutely
more efficient producers than others.
a) comparative advantage
b) absolute advantage
c) social equity
d) laissez-faire
.
5) Specialization and trade exploit differences in productivity across workers and
a) only benefit the exporter.
b) only benefit the importer
c) make everyone better off.
d) make everyone worse off
.
6) If a vintner has a comparative advantage in producing wine
a) he can produce more wine using the same resources than other vintners.
b) wine is the only product he can produce.
c) he can produce wine at a lower opportunity cost than other vintners.
d) he also has an absolute advantage in producing wine.
.
7) Which of the following is an act of economic "investment"?
a) The state legislature authorizes the sale of a state park
b) An entrepreneur buys 5000 shares of stock at $5 a share and then sells the stock at a profit for $60 a share.
c) A manufacturer purchases a new machinery system for his plant.
d) A teacher deposits $500 in a retirement account.
.
8) In economics, the creation of capital is referred to as
a) investment.
b) comparative advantage
c) consumption.
d) allocation.
.
9) When an economy is producing inside its production possibility frontier
a) production inefficiency occurs
b) only technological advances will allow it to increase production
c) it is efficient so long as it is producing what people want.
d) it must overcompensate by producing outside the curve to achieve efficiency.
.
10) According to Figure 2.4, Point A necessarily represents
a) an unattainable production point
b) only hybrid cars being produced
c) the economy's optimal production point.
d) what society wants.
.
11) According to Figure 2.4, Point F
a) is efficient and attainable
b) represents underallocation of resources
c) represents what the people want.
d) cannot be produced with the current state of technology
.
12) According to Figure 2.4, Point E necessarily represents
a) an impossible production point
b) technological advancement
c) overallocation of resources
d) only motorcycle.
1. The main advantage to a corporation is…A) ease of entryB)salmonpybus
1. The main advantage to a corporation is…
A) ease of entry
B) limited liability for the owners
C) dividends all go to one person
D) owners share managerial duty
E) all of the above
2. The main advantage to a sole proprietorship is…
A) ease of entry
B) financial capital is easy to obtain
C) owners need little expertise in the day to day business
D) limited liability for the owner
E) all of the above
3. The main disadvantage to a sole proprietorship is…
A) profits must be shared
B) difficult and expensive to open
C) unlimited liability
D) single taxation
E) all of the above
4. The owners of a corporation are called
A) Corporate officers
B) The board of directors
C) Stockholders
D) Corporate executives
5. Profit is defined as
A) net revenue minus depreciation.
B) average revenue minus average total cost.
C) marginal revenue minus marginal cost.
D) total revenue minus total cost.
6. Which of the following is most likely to be a fixed cost?
A) materials
B) wages
C) rent
D) utilities
E) all of the above
7. A variable cost…
A) increases as production increases.
B) is a constant cost of production.
C) is always changing no matter the circumstance.
D) is a cost like manager’s salaries, rent, etc.
E) none of the above
8. Opportunity costs are comprised of
A) explicit costs.
B) implicit costs.
C) forgone income.
D) all of the above.
9. An example of an explicit cost of production would be
A) the cost of forgone labor earnings for an entrepreneur.
B) the cost of flour for a baker.
C) the lost opportunity to invest in other capital markets when the money is invested in one’s business.
D) none of the above.
10. If marginal cost is rising
A) marginal product must be rising.
B) marginal product must be falling.
C) average variable cost must be falling.
D) average fixed cost must be rising.
11. Economies of scale occur when
A) long-run average total costs rise as output increases.
B) average fixed costs are falling.
C) long-run average total costs fall as output increases.
D) average fixed costs are constant.
12. For a firm in a perfectly competitive market the price of the good is always equal to
A) marginal revenue.
B) average revenue.
C) equilibrium market price.
D) all of the above.
13. Which of the following is not a characteristic of a perfectly competitive market?
A) Firms are price takers.
B) There are many sellers in the market.
C) Goods offered for sale are largely the same.
D) Firms have difficulty entering the market.
14. When firms are said to be price takers, it implies that if a firm raises its price,
A) buyers will go elsewhere.
B) buyers will pay the higher price in the short run.
C) competitors will also raise their prices.
D) firms in the industry will exercise market power.
15. Characteristics of a Monopoly include:
(i) sole seller of its product.
(ii) product does not have close substitutes.
(iii) generates large economic profits.
(iv) they must sell at a cert ...
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New School of ArchitectureEcon 281Final ExamName ________.docxcurwenmichaela
New School of Architecture
Econ 281
Final Exam Name __________
1) Externalities
A) can be either benefits or costs.
B) always create extra social costs.
C) always make society better off.
D) cannot be expressed in dollar amounts.
E) are always part of private costs or private benefits.
2) A cost that arises from the production or consumption that falls on someone other than the producer or consumer is called
A) a negative benefit.
B) a public choice impact.
C) a positive externality.
D) a negative externality.
E) a private good.
3) Evidence of external costs in the production of a product is present if
A) the price of the product is higher than it should be.
B) the production cost increases because of an increase in the minimum wage.
C) non-buyers and/or non-producers of the product experience a loss for which they are not compensated.
D) buyers refuse to purchase the product.
E) producers pay all of the costs of producing the good or service.
4) Marginal private cost
A) is always zero if there is an external cost.
B) equals the marginal social cost only if the marginal external cost is positive.
C) is the cost of producing an additional unit of a good or service that is paid by the producer of that good or service.
D) the cost of producing an additional unit of a good or service that falls on people other than the producer of that good or service.
E) the cost of producing an additional unit of a good or service that is paid by the entire society.
5) A private cost is a cost of production that is
A) borne by the producer of a good.
B) measured in marginal terms.
C) borne by someone other than the producer of a good.
D) measured in total terms.
E) the same as an external cost.
6) The difference between private cost and social cost is that
A) social cost only considers the external cost borne by society.
B) social cost only considers the cost borne by people other than the producer.
C) private cost only considers the cost borne by producers of the good.
D) social cost also includes any external benefit whereas private cost excludes all external benefits.
E) there is no difference; the terms refer to the same cost.
7) Harry, the owner of a beauty salon, hires a new hair stylist. The wages paid to the new stylist are
A) a private cost and not an external cost.
B) an external cost and not a private cost.
C) both a private cost and an external cost.
D) neither a private cost nor an external cost.
E) only a private benefit because people want their hair styled.
8 The cost of producing an additional unit of a good or service that falls on people other than the producer is the marginal
A) external cost.
B) private cost.
C) social cost.
D) social benefit.
E) None of the above answers is correct.
9) A firm dumps dioxin in a river, thereby severely polluting the river. The cost of the water pollution is
i. zero for the firm.
ii. an external cost.
iii. part of the marginal social cost
A) i only
B) ii only
C) iii only
D) ii and iii
E) i, ...
1.) Since the mid-1980s, the __________ sector has generated t.docxelliotkimberlee
1.) Since the mid-1980s, the __________ sector has generated the most amount of increases in employment in the United
States.
A._ manufacturing
B) agricultural
C) service
D) goods producing
2) When referring to risk, which of the following statements is reasonable?
A) Although risk means taking a chance at losing, the less risk you take, the more you are likely to profit.
B) Good business strategy encourages less risk, because the least risky ventures usually make more profit.
C) Sizeable risks can lead to substantial profits, if the business takes calculated risks and captures good
opportunities.
D) Although risk means taking a chance, a start-up will usually manage to get off the ground faster if the
stakes are high.
3) Darnell lives in an area where labor is plentiful and locations for start-ups are relatively cheap. He is also confident that
he can find start-up funds for a graphic arts business. As he evaluates the opportunity for his proposed venture, which
of the following factors of production should he focus on?
A) Capital and land
B) Labor and knowledge
C) Entrepreneurship and capital
D) Entrepreneurship and knowledge
4) Lance and Laurie live on three acres of land in North Carolina, with two llamas, five goats, six chickens, and two
dogs. The goats provide milk, cheese, yogurt, and even fiber that is woven into yarn; the chickens provide free-range
eggs; and the llamas serve as protection for the other animals. Although Lance and Laurie have other professional jobs,
their home lifestyle represents _______.
A) a growing trend in the social environment to have more control of the food they eat and where it comes From
B) a need to challenge the competitive environments of big businesses that sell the same products
C) a desire to pay less sales tax on foods and other staple products at the larger stores
D) an aversion to technological advancement leading to a slower and less productive life
5) Since the mid-1980s, the __________ sector has generated the MOST amount of increases in employment in the United
States.
A) Manufacturing
B) Agricultural
C) service
D) goods producing
6) During the 2010 Gulf Oil Spill, former BP CEO, Tony Hayward, was quoted as saying: "I want my life back!" Although heapologized for this remark in a later statement, the original message remained in the thoughts of many, particularlyunder the circumstances that 11 persons lost their lives; several communities experienced extreme devastation; many fishing industry businesses lost their livelihood; and dead sea life washed up on the shores of several southern states
and Mexico. In terms of corporate social responsibility, which of the following statements would you like to share with
Tony Hayward?
A) We should repeat well-known economist Milton Friedman's statement that the only social responsibility of business is to make money for stockholders.
B) The company's CSR (corporate social responsibility) approach lacked whistleblowers that would e.
1.) Since the mid-1980s, the __________ sector has generated the m.docxjackiewalcutt
1.) Since the mid-1980s, the __________ sector has generated the most amount of increases in employment in the United
States.
A._ manufacturing
B) agricultural
C) service
D) goods producing
2) When referring to risk, which of the following statements is reasonable?
A) Although risk means taking a chance at losing, the less risk you take, the more you are likely to profit.
B) Good business strategy encourages less risk, because the least risky ventures usually make more profit.
C) Sizeable risks can lead to substantial profits, if the business takes calculated risks and captures good
opportunities.
D) Although risk means taking a chance, a start-up will usually manage to get off the ground faster if the
stakes are high.
3) Darnell lives in an area where labor is plentiful and locations for start-ups are relatively cheap. He is also confident that
he can find start-up funds for a graphic arts business. As he evaluates the opportunity for his proposed venture, which
of the following factors of production should he focus on?
A) Capital and land
B) Labor and knowledge
C) Entrepreneurship and capital
D) Entrepreneurship and knowledge
4) Lance and Laurie live on three acres of land in North Carolina, with two llamas, five goats, six chickens, and two
dogs. The goats provide milk, cheese, yogurt, and even fiber that is woven into yarn; the chickens provide free-range
eggs; and the llamas serve as protection for the other animals. Although Lance and Laurie have other professional jobs,
their home lifestyle represents _______.
A) a growing trend in the social environment to have more control of the food they eat and where it comes From
B) a need to challenge the competitive environments of big businesses that sell the same products
C) a desire to pay less sales tax on foods and other staple products at the larger stores
D) an aversion to technological advancement leading to a slower and less productive life
5) Since the mid-1980s, the __________ sector has generated the MOST amount of increases in employment in the United
States.
A) Manufacturing
B) Agricultural
C) service
D) goods producing
6) During the 2010 Gulf Oil Spill, former BP CEO, Tony Hayward, was quoted as saying: "I want my life back!" Although heapologized for this remark in a later statement, the original message remained in the thoughts of many, particularlyunder the circumstances that 11 persons lost their lives; several communities experienced extreme devastation; many fishing industry businesses lost their livelihood; and dead sea life washed up on the shores of several southern states
and Mexico. In terms of corporate social responsibility, which of the following statements would you like to share with
Tony Hayward?
A) We should repeat well-known economist Milton Friedman's statement that the only social responsibility of business is to make money for stockholders.
B) The company's CSR (corporate social responsibility) approach lacked whistleblowers that would e ...
Econ 213 (A1) Final Examination (version A) .docxSALU18
Econ 213 (A1) Final Examination (version A) The University of Alberta SPRING 2013 S. Beesley
YOU WRITE THIS EXAM IF YOU COMPLETED THE MIDTERM!
Name_________________________________________ Student Number___________________________________
This exam has 33 multiple-choice questions. Please mark your answers on the scantron sheet. Please put your name and
student number on this page, and the scantron, immediately if not sooner.
There are also 3 written questions of 11 marks each, making the overall exam 66 marks in 120 minutes.
Please allocate your time accordingly!
SECTION A 33 MARKS
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.
1) The article about Africa entitled "Bulging in the Middle" noted that there were four causes of Africa's rise. Three
of the four are listed here - which one does not belong?
A) technology having large effects B) the right kind of population growth
C) better governance and economic management D) greatly increased agricultural productivity
2) There is a messy, intermittent, and sometimes sadly violent North-South divide across central Africa between
A) Christian and animist (local African) religions B) Sunni and Shiite Moslems
C) oil-rich states and the others D) Muslim and Christian terrritories
3) Nigeria has lost a very great deal of money to corruption and incompetence. The amount involved is, very
roughly:
A) Hundreds of millions of dollars B) Hundreds of billions of dollars
C) Tens of millions of dollars D) About 2.5 to 3.0 trillion dollars
4) Given the large debt increases in the last 20 years, why have we not seen even more sovereign defaults among
LDCs (and, for that matter, OECD countries)?
A) high real interest rates
B) the pattern of declining interest rates
C) The successful implementation of austerity programs and taxes on the well-off in LDCs
D) The massive debts have been offset by huge debt forgiveness totals
5) The IMF was accused in one article of hypocrisy because it advocated
A) austerity in rich countries and spending in poor ones
B) austerity at all times and places
C) austerity in poor countries and spending in rich ones
D) printing money when necessary to kick-start dormant economies
6) Alexander Sack wrote that debt was odious when
A) The funds originally loaned had not been used in "the interests of the State."
B) The interest rates charged were so high as to be odious
C) A significant fraction of the money had been stolen by corrupt officials
D) Repaying that debt would result in significant social hardship
7) Easterly established that more indebted countries were characterized by all of these except
A) A lower black market premium
B) Smaller bank systems
C) A faster rate of asset sales
D) New borrowing that exceeded any debt relief given
1
8) Easterly pointed out that in some governments, the divisions across ethnic groups result in a version of the
A) negative externality prob ...
1. In the managerial function of __________, managers encourage a.docxelliotkimberlee
1. In the managerial function of __________, managers encourage and motivate workers to work toward organizational goals.
a) organizing
b) planning
c) controlling
d) leading
2. eBay.com is a vast auction site that is similar to a competitive market in some ways but differs from it in others. Which of the following describes how eBay resembles a competitive market?
a) On eBay the large sellers dominate the market.
b) Sellers sometimes do not describe the products accurately on eBay.
c) There is a great variety of different products sold on eBay.
d) It is easy to enter and easy to leave eBay.
3. From the point of view of consumer surplus and producer surplus, what problem was created when Thailand subsidized the cost of energy to consumers to help alleviate the burden of higher energy costs?
a) It encouraged the consumption of too much fuel at the expense of other goods.
b) It has no effect; consumers gained consumer surplus, but taxpayers lost the same amount because they had to finance the subsidy.
c) It hurt the poor and benefitted the rich.
d) It led to less fuel being used than the amount that maximizes consumer surplus.
4. The following is an example of a moral value judgment:
a) Keith Lewis must be a total flake.
b) The senator dresses well.
c) As an actress, Paris Hilton has a nice clothes rack.
d) I don’t deserve to be flunked for an honest mistake.
5. Research on the five-stage model of group development shows that
a) all groups pass through the norming stage.
b) not all groups go through each of the stages.
c) groups always pass through the stages in order.
d) all groups pass through the adjourning stage.
6. A standardized language used to manipulate data is
a) Microsoft Access.
b) a structured query language.
c) Oracle.
d) a data manipulation language.
7. Business communication is often more demanding than social communication because communication on the job is affected by
a) desire to always advance and move up in an organization.
b) the growing reliance on teamwork in business.
c) personalities.
d) politics.
8. Communication is the process of
a) listening actively.
b) talking constantly.
c) transferring information and meaning.
d) writing messages.
9. Aggregate demand management policies are designed most directly to
a) prevent budget deficits or surpluses
b) control the aggregate level of spending in the economy
c) minimize inflation
d) minimize unemployment
10. What is a subjective statement?
a) A statement that is fact
b) A statement made true by someone thinking it is true
c) A statement involving a subject
d) A statement that pertains to a chapter in a book
11. Brenda Butler, editor of the Republican, is trying to decide whether to take a job at a much larger newspaper or to become the CEO and publis.
BUS475 Capstone Final Examination, Part11. In the managerial f.docxPazSilviapm
BUS/475 Capstone Final Examination, Part1
1. In the managerial function of __________, managers encourage and motivate workers to work toward organizational goals.
a) organizing
b) planning
c) controlling
d) leading
2. eBay.com is a vast auction site that is similar to a competitive market in some ways but differs from it in others. Which of the following describes how eBay resembles a competitive market?
a) On eBay the large sellers dominate the market.
b) Sellers sometimes do not describe the products accurately on eBay.
c) There is a great variety of different products sold on eBay.
d) It is easy to enter and easy to leave eBay.
3. From the point of view of consumer surplus and producer surplus, what problem was created when Thailand subsidized the cost of energy to consumers to help alleviate the burden of higher energy costs?
a) It encouraged the consumption of too much fuel at the expense of other goods.
b) It has no effect; consumers gained consumer surplus, but taxpayers lost the same amount because they had to finance the subsidy.
c) It hurt the poor and benefitted the rich.
d) It led to less fuel being used than the amount that maximizes consumer surplus.
4. The following is an example of a moral value judgment:
a) Keith Lewis must be a total flake.
b) The senator dresses well.
c) As an actress, Paris Hilton has a nice clothes rack.
d) I don’t deserve to be flunked for an honest mistake.
5. Research on the five-stage model of group development shows that
a) all groups pass through the norming stage.
b) not all groups go through each of the stages.
c) groups always pass through the stages in order.
d) all groups pass through the adjourning stage.
6. A standardized language used to manipulate data is
a) Microsoft Access.
b) a structured query language.
c) Oracle.
d) a data manipulation language.
7. Business communication is often more demanding than social communication because communication on the job is affected by
a) desire to always advance and move up in an organization.
b) the growing reliance on teamwork in business.
c) personalities.
d) politics.
8. Communication is the process of
a) listening actively.
b) talking constantly.
c) transferring information and meaning.
d) writing messages.
9. Aggregate demand management policies are designed most directly to
a) prevent budget deficits or surpluses
b) control the aggregate level of spending in the economy
c) minimize inflation
d) minimize unemployment
10. What is a subjective statement?
a) A statement that is fact
b) A statement made true by someone thinking it is true
c) A statement involving a subject
d) A statement that pertains to a chapter in a book
11. Brenda Butler, editor of the Republican, is trying to decide whether to take a job at a much larger n.
1. The main advantage to a corporation is…A) ease of entryB)salmonpybus
1. The main advantage to a corporation is…
A) ease of entry
B) limited liability for the owners
C) dividends all go to one person
D) owners share managerial duty
E) all of the above
2. The main advantage to a sole proprietorship is…
A) ease of entry
B) financial capital is easy to obtain
C) owners need little expertise in the day to day business
D) limited liability for the owner
E) all of the above
3. The main disadvantage to a sole proprietorship is…
A) profits must be shared
B) difficult and expensive to open
C) unlimited liability
D) single taxation
E) all of the above
4. The owners of a corporation are called
A) Corporate officers
B) The board of directors
C) Stockholders
D) Corporate executives
5. Profit is defined as
A) net revenue minus depreciation.
B) average revenue minus average total cost.
C) marginal revenue minus marginal cost.
D) total revenue minus total cost.
6. Which of the following is most likely to be a fixed cost?
A) materials
B) wages
C) rent
D) utilities
E) all of the above
7. A variable cost…
A) increases as production increases.
B) is a constant cost of production.
C) is always changing no matter the circumstance.
D) is a cost like manager’s salaries, rent, etc.
E) none of the above
8. Opportunity costs are comprised of
A) explicit costs.
B) implicit costs.
C) forgone income.
D) all of the above.
9. An example of an explicit cost of production would be
A) the cost of forgone labor earnings for an entrepreneur.
B) the cost of flour for a baker.
C) the lost opportunity to invest in other capital markets when the money is invested in one’s business.
D) none of the above.
10. If marginal cost is rising
A) marginal product must be rising.
B) marginal product must be falling.
C) average variable cost must be falling.
D) average fixed cost must be rising.
11. Economies of scale occur when
A) long-run average total costs rise as output increases.
B) average fixed costs are falling.
C) long-run average total costs fall as output increases.
D) average fixed costs are constant.
12. For a firm in a perfectly competitive market the price of the good is always equal to
A) marginal revenue.
B) average revenue.
C) equilibrium market price.
D) all of the above.
13. Which of the following is not a characteristic of a perfectly competitive market?
A) Firms are price takers.
B) There are many sellers in the market.
C) Goods offered for sale are largely the same.
D) Firms have difficulty entering the market.
14. When firms are said to be price takers, it implies that if a firm raises its price,
A) buyers will go elsewhere.
B) buyers will pay the higher price in the short run.
C) competitors will also raise their prices.
D) firms in the industry will exercise market power.
15. Characteristics of a Monopoly include:
(i) sole seller of its product.
(ii) product does not have close substitutes.
(iii) generates large economic profits.
(iv) they must sell at a cert ...
Bus 475 final exam 100 questions with answers 4th set answers are hererenat88
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New School of ArchitectureEcon 281Final ExamName ________.docxcurwenmichaela
New School of Architecture
Econ 281
Final Exam Name __________
1) Externalities
A) can be either benefits or costs.
B) always create extra social costs.
C) always make society better off.
D) cannot be expressed in dollar amounts.
E) are always part of private costs or private benefits.
2) A cost that arises from the production or consumption that falls on someone other than the producer or consumer is called
A) a negative benefit.
B) a public choice impact.
C) a positive externality.
D) a negative externality.
E) a private good.
3) Evidence of external costs in the production of a product is present if
A) the price of the product is higher than it should be.
B) the production cost increases because of an increase in the minimum wage.
C) non-buyers and/or non-producers of the product experience a loss for which they are not compensated.
D) buyers refuse to purchase the product.
E) producers pay all of the costs of producing the good or service.
4) Marginal private cost
A) is always zero if there is an external cost.
B) equals the marginal social cost only if the marginal external cost is positive.
C) is the cost of producing an additional unit of a good or service that is paid by the producer of that good or service.
D) the cost of producing an additional unit of a good or service that falls on people other than the producer of that good or service.
E) the cost of producing an additional unit of a good or service that is paid by the entire society.
5) A private cost is a cost of production that is
A) borne by the producer of a good.
B) measured in marginal terms.
C) borne by someone other than the producer of a good.
D) measured in total terms.
E) the same as an external cost.
6) The difference between private cost and social cost is that
A) social cost only considers the external cost borne by society.
B) social cost only considers the cost borne by people other than the producer.
C) private cost only considers the cost borne by producers of the good.
D) social cost also includes any external benefit whereas private cost excludes all external benefits.
E) there is no difference; the terms refer to the same cost.
7) Harry, the owner of a beauty salon, hires a new hair stylist. The wages paid to the new stylist are
A) a private cost and not an external cost.
B) an external cost and not a private cost.
C) both a private cost and an external cost.
D) neither a private cost nor an external cost.
E) only a private benefit because people want their hair styled.
8 The cost of producing an additional unit of a good or service that falls on people other than the producer is the marginal
A) external cost.
B) private cost.
C) social cost.
D) social benefit.
E) None of the above answers is correct.
9) A firm dumps dioxin in a river, thereby severely polluting the river. The cost of the water pollution is
i. zero for the firm.
ii. an external cost.
iii. part of the marginal social cost
A) i only
B) ii only
C) iii only
D) ii and iii
E) i, ...
1.) Since the mid-1980s, the __________ sector has generated t.docxelliotkimberlee
1.) Since the mid-1980s, the __________ sector has generated the most amount of increases in employment in the United
States.
A._ manufacturing
B) agricultural
C) service
D) goods producing
2) When referring to risk, which of the following statements is reasonable?
A) Although risk means taking a chance at losing, the less risk you take, the more you are likely to profit.
B) Good business strategy encourages less risk, because the least risky ventures usually make more profit.
C) Sizeable risks can lead to substantial profits, if the business takes calculated risks and captures good
opportunities.
D) Although risk means taking a chance, a start-up will usually manage to get off the ground faster if the
stakes are high.
3) Darnell lives in an area where labor is plentiful and locations for start-ups are relatively cheap. He is also confident that
he can find start-up funds for a graphic arts business. As he evaluates the opportunity for his proposed venture, which
of the following factors of production should he focus on?
A) Capital and land
B) Labor and knowledge
C) Entrepreneurship and capital
D) Entrepreneurship and knowledge
4) Lance and Laurie live on three acres of land in North Carolina, with two llamas, five goats, six chickens, and two
dogs. The goats provide milk, cheese, yogurt, and even fiber that is woven into yarn; the chickens provide free-range
eggs; and the llamas serve as protection for the other animals. Although Lance and Laurie have other professional jobs,
their home lifestyle represents _______.
A) a growing trend in the social environment to have more control of the food they eat and where it comes From
B) a need to challenge the competitive environments of big businesses that sell the same products
C) a desire to pay less sales tax on foods and other staple products at the larger stores
D) an aversion to technological advancement leading to a slower and less productive life
5) Since the mid-1980s, the __________ sector has generated the MOST amount of increases in employment in the United
States.
A) Manufacturing
B) Agricultural
C) service
D) goods producing
6) During the 2010 Gulf Oil Spill, former BP CEO, Tony Hayward, was quoted as saying: "I want my life back!" Although heapologized for this remark in a later statement, the original message remained in the thoughts of many, particularlyunder the circumstances that 11 persons lost their lives; several communities experienced extreme devastation; many fishing industry businesses lost their livelihood; and dead sea life washed up on the shores of several southern states
and Mexico. In terms of corporate social responsibility, which of the following statements would you like to share with
Tony Hayward?
A) We should repeat well-known economist Milton Friedman's statement that the only social responsibility of business is to make money for stockholders.
B) The company's CSR (corporate social responsibility) approach lacked whistleblowers that would e.
1.) Since the mid-1980s, the __________ sector has generated the m.docxjackiewalcutt
1.) Since the mid-1980s, the __________ sector has generated the most amount of increases in employment in the United
States.
A._ manufacturing
B) agricultural
C) service
D) goods producing
2) When referring to risk, which of the following statements is reasonable?
A) Although risk means taking a chance at losing, the less risk you take, the more you are likely to profit.
B) Good business strategy encourages less risk, because the least risky ventures usually make more profit.
C) Sizeable risks can lead to substantial profits, if the business takes calculated risks and captures good
opportunities.
D) Although risk means taking a chance, a start-up will usually manage to get off the ground faster if the
stakes are high.
3) Darnell lives in an area where labor is plentiful and locations for start-ups are relatively cheap. He is also confident that
he can find start-up funds for a graphic arts business. As he evaluates the opportunity for his proposed venture, which
of the following factors of production should he focus on?
A) Capital and land
B) Labor and knowledge
C) Entrepreneurship and capital
D) Entrepreneurship and knowledge
4) Lance and Laurie live on three acres of land in North Carolina, with two llamas, five goats, six chickens, and two
dogs. The goats provide milk, cheese, yogurt, and even fiber that is woven into yarn; the chickens provide free-range
eggs; and the llamas serve as protection for the other animals. Although Lance and Laurie have other professional jobs,
their home lifestyle represents _______.
A) a growing trend in the social environment to have more control of the food they eat and where it comes From
B) a need to challenge the competitive environments of big businesses that sell the same products
C) a desire to pay less sales tax on foods and other staple products at the larger stores
D) an aversion to technological advancement leading to a slower and less productive life
5) Since the mid-1980s, the __________ sector has generated the MOST amount of increases in employment in the United
States.
A) Manufacturing
B) Agricultural
C) service
D) goods producing
6) During the 2010 Gulf Oil Spill, former BP CEO, Tony Hayward, was quoted as saying: "I want my life back!" Although heapologized for this remark in a later statement, the original message remained in the thoughts of many, particularlyunder the circumstances that 11 persons lost their lives; several communities experienced extreme devastation; many fishing industry businesses lost their livelihood; and dead sea life washed up on the shores of several southern states
and Mexico. In terms of corporate social responsibility, which of the following statements would you like to share with
Tony Hayward?
A) We should repeat well-known economist Milton Friedman's statement that the only social responsibility of business is to make money for stockholders.
B) The company's CSR (corporate social responsibility) approach lacked whistleblowers that would e ...
Econ 213 (A1) Final Examination (version A) .docxSALU18
Econ 213 (A1) Final Examination (version A) The University of Alberta SPRING 2013 S. Beesley
YOU WRITE THIS EXAM IF YOU COMPLETED THE MIDTERM!
Name_________________________________________ Student Number___________________________________
This exam has 33 multiple-choice questions. Please mark your answers on the scantron sheet. Please put your name and
student number on this page, and the scantron, immediately if not sooner.
There are also 3 written questions of 11 marks each, making the overall exam 66 marks in 120 minutes.
Please allocate your time accordingly!
SECTION A 33 MARKS
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.
1) The article about Africa entitled "Bulging in the Middle" noted that there were four causes of Africa's rise. Three
of the four are listed here - which one does not belong?
A) technology having large effects B) the right kind of population growth
C) better governance and economic management D) greatly increased agricultural productivity
2) There is a messy, intermittent, and sometimes sadly violent North-South divide across central Africa between
A) Christian and animist (local African) religions B) Sunni and Shiite Moslems
C) oil-rich states and the others D) Muslim and Christian terrritories
3) Nigeria has lost a very great deal of money to corruption and incompetence. The amount involved is, very
roughly:
A) Hundreds of millions of dollars B) Hundreds of billions of dollars
C) Tens of millions of dollars D) About 2.5 to 3.0 trillion dollars
4) Given the large debt increases in the last 20 years, why have we not seen even more sovereign defaults among
LDCs (and, for that matter, OECD countries)?
A) high real interest rates
B) the pattern of declining interest rates
C) The successful implementation of austerity programs and taxes on the well-off in LDCs
D) The massive debts have been offset by huge debt forgiveness totals
5) The IMF was accused in one article of hypocrisy because it advocated
A) austerity in rich countries and spending in poor ones
B) austerity at all times and places
C) austerity in poor countries and spending in rich ones
D) printing money when necessary to kick-start dormant economies
6) Alexander Sack wrote that debt was odious when
A) The funds originally loaned had not been used in "the interests of the State."
B) The interest rates charged were so high as to be odious
C) A significant fraction of the money had been stolen by corrupt officials
D) Repaying that debt would result in significant social hardship
7) Easterly established that more indebted countries were characterized by all of these except
A) A lower black market premium
B) Smaller bank systems
C) A faster rate of asset sales
D) New borrowing that exceeded any debt relief given
1
8) Easterly pointed out that in some governments, the divisions across ethnic groups result in a version of the
A) negative externality prob ...
1. In the managerial function of __________, managers encourage a.docxelliotkimberlee
1. In the managerial function of __________, managers encourage and motivate workers to work toward organizational goals.
a) organizing
b) planning
c) controlling
d) leading
2. eBay.com is a vast auction site that is similar to a competitive market in some ways but differs from it in others. Which of the following describes how eBay resembles a competitive market?
a) On eBay the large sellers dominate the market.
b) Sellers sometimes do not describe the products accurately on eBay.
c) There is a great variety of different products sold on eBay.
d) It is easy to enter and easy to leave eBay.
3. From the point of view of consumer surplus and producer surplus, what problem was created when Thailand subsidized the cost of energy to consumers to help alleviate the burden of higher energy costs?
a) It encouraged the consumption of too much fuel at the expense of other goods.
b) It has no effect; consumers gained consumer surplus, but taxpayers lost the same amount because they had to finance the subsidy.
c) It hurt the poor and benefitted the rich.
d) It led to less fuel being used than the amount that maximizes consumer surplus.
4. The following is an example of a moral value judgment:
a) Keith Lewis must be a total flake.
b) The senator dresses well.
c) As an actress, Paris Hilton has a nice clothes rack.
d) I don’t deserve to be flunked for an honest mistake.
5. Research on the five-stage model of group development shows that
a) all groups pass through the norming stage.
b) not all groups go through each of the stages.
c) groups always pass through the stages in order.
d) all groups pass through the adjourning stage.
6. A standardized language used to manipulate data is
a) Microsoft Access.
b) a structured query language.
c) Oracle.
d) a data manipulation language.
7. Business communication is often more demanding than social communication because communication on the job is affected by
a) desire to always advance and move up in an organization.
b) the growing reliance on teamwork in business.
c) personalities.
d) politics.
8. Communication is the process of
a) listening actively.
b) talking constantly.
c) transferring information and meaning.
d) writing messages.
9. Aggregate demand management policies are designed most directly to
a) prevent budget deficits or surpluses
b) control the aggregate level of spending in the economy
c) minimize inflation
d) minimize unemployment
10. What is a subjective statement?
a) A statement that is fact
b) A statement made true by someone thinking it is true
c) A statement involving a subject
d) A statement that pertains to a chapter in a book
11. Brenda Butler, editor of the Republican, is trying to decide whether to take a job at a much larger newspaper or to become the CEO and publis.
BUS475 Capstone Final Examination, Part11. In the managerial f.docxPazSilviapm
BUS/475 Capstone Final Examination, Part1
1. In the managerial function of __________, managers encourage and motivate workers to work toward organizational goals.
a) organizing
b) planning
c) controlling
d) leading
2. eBay.com is a vast auction site that is similar to a competitive market in some ways but differs from it in others. Which of the following describes how eBay resembles a competitive market?
a) On eBay the large sellers dominate the market.
b) Sellers sometimes do not describe the products accurately on eBay.
c) There is a great variety of different products sold on eBay.
d) It is easy to enter and easy to leave eBay.
3. From the point of view of consumer surplus and producer surplus, what problem was created when Thailand subsidized the cost of energy to consumers to help alleviate the burden of higher energy costs?
a) It encouraged the consumption of too much fuel at the expense of other goods.
b) It has no effect; consumers gained consumer surplus, but taxpayers lost the same amount because they had to finance the subsidy.
c) It hurt the poor and benefitted the rich.
d) It led to less fuel being used than the amount that maximizes consumer surplus.
4. The following is an example of a moral value judgment:
a) Keith Lewis must be a total flake.
b) The senator dresses well.
c) As an actress, Paris Hilton has a nice clothes rack.
d) I don’t deserve to be flunked for an honest mistake.
5. Research on the five-stage model of group development shows that
a) all groups pass through the norming stage.
b) not all groups go through each of the stages.
c) groups always pass through the stages in order.
d) all groups pass through the adjourning stage.
6. A standardized language used to manipulate data is
a) Microsoft Access.
b) a structured query language.
c) Oracle.
d) a data manipulation language.
7. Business communication is often more demanding than social communication because communication on the job is affected by
a) desire to always advance and move up in an organization.
b) the growing reliance on teamwork in business.
c) personalities.
d) politics.
8. Communication is the process of
a) listening actively.
b) talking constantly.
c) transferring information and meaning.
d) writing messages.
9. Aggregate demand management policies are designed most directly to
a) prevent budget deficits or surpluses
b) control the aggregate level of spending in the economy
c) minimize inflation
d) minimize unemployment
10. What is a subjective statement?
a) A statement that is fact
b) A statement made true by someone thinking it is true
c) A statement involving a subject
d) A statement that pertains to a chapter in a book
11. Brenda Butler, editor of the Republican, is trying to decide whether to take a job at a much larger n.
Bus 475 final exam 100 questions with answers 2nd set answers are here
ppcmcq
1.
2. 1. Economics is the study of how:
A) Best to use society's scarce resources.
B) Society spends the income of individuals.
C) Society purchases resources, given its macroeconomic goals.
D) Individual market participants decide what to produce given fixed
resource constraints.
2. Economics can be defined as the study of:
A) For whom resources are allocated to increase efficiency.
B) How society spends the income of individuals.
C) How scarce resources are allocated to fulfill society's goals.
D) What scarce resources are used to produce goods and services.
3. The fundamental problem of economics is:
A) The law of increasing opportunity costs.
B) The scarcity of resources relative to human wants.
C) How to get government to operate efficiently.
D) How to create employment for everyone.
4. In economics, what does scarcity mean?
A) That a shortage of a particular good will cause the price to fall.
B) That a production-possibilities curve cannot accurately represent the
tradeoff between two goods.
C) That society's desires exceed the want-satisfying capability of the resources
available to satisfy those desires.
D) That the market mechanism has failed.
3. 5. Given that resources are scarce:
A) A "free lunch" is possible but only for a limited number of people.
B) Opportunity costs are experienced whenever choices are made.
C) Poor countries must make choices but rich countries with abundant
resources do not have to make choices.
D) Some choices involve opportunity costs while other choices do not.
6. Which of the following is the best description of the origin of the economic problem of
scarcity?
A) Humans have limited wants for goods and services and resources are also
limited.
B) Humans have limited wants for goods and services and resources are
unlimited.
C) Humans have unlimited wants for goods and services but resources are
limited.
D) Humans have unlimited wants for goods and services and resources are also
unlimited.
7. A consequence of the economic problem of scarcity is that:
A) Choices have to be made about how resources are used.
B) There is never too much of any good or service produced.
C) The production of goods and services must be controlled by the
government.
D) The production-possibilities curve is bowed outward.
4. 8. Which of the following is a scarce resource?
A) Paper used to produce textbooks. C) Clean water.
B) Wheat given to Russia to alleviate hunger. D) All of the above.
9. Which of the following is a scarce resource?
A) Land. B) Labor. C) Entrepreneurship. D) All of the above.
10. Factors of production are:
A) Scarce in every society.
B) Scarce only in United States.
C) Scarce only in the poorest countries of the world.
D) Unlimited in quantity.
11. Which of the following is not a factor of production?
A) A teacher. C) The $100,000 used to start a new business.
B) A ballpoint pen. D) Ten acres of forest.
12. Which of the following is an economic resource?
A) A worker used to build a new highway.
B) An office building used by an insurance company.
C) A vacant piece of land in New York City.
D) All of the above are economic resources.
13. With respect to factors of production, which of the following statements is not true?
A) Factors of production are also known as resources.
B) In order to produce anything, it is necessary to have factors of production.
C) Factors of production include land, labor, capital, and entrepreneurship.
D) Only those resources that are privately owned are counted as factors of production.
5. 14. Which of the following is the best example of land?
A) The gasoline refined from crude oil.
B) A factory which produces new goods and services.
C) The river water used to float a riverboat casino.
D) A shovel.
15. Capital, as economists use the term, refers to:
A) The money needed to start a new business.
B) The costs of operating a business.
C) Shares of stock issued by businesses.
D) Final goods that are used to produce other goods and services.
16. Which of the following is the best example of capital and no other factor of production?
A) Clean air.
B) Money in a savings account.
C) Equipment that will be used to produce goods.
D) The property on which a landfill has been established.
17. Which of the following performs the role of both capital and land?
A) A manufacturing plant and the property on which it is located.
B) The equipment used to produce goods.
C) A mine that has been vacated because it is no longer profitable.
D) All of the above.
6. 18. An entrepreneur is:
A) An innovator.
B) Someone who brings resources together and produces a product.
C) A risk taker.
D) All of the above.
19. The role of the entrepreneur in an economy is to:
A) Bring the factors of production together and assume the risk of production.
B) Work with government planners to determine what goods are produced.
C) Arrange bank financing for the owners of new businesses.
D) Ensure full employment of labor.
20. Opportunity cost is:
A) Only measured in dollars and cents.
B) The dollar cost to society of producing the goods.
C) The difficulty associated with using one good in place of another.
D) The alternative that must be given up in order to get something else.
21. Opportunity cost may be defined as the:
A) Goods or services that are forgone in order to obtain something else.
B) Dollar prices paid for final goods and services.
C) Dollar cost of producing a particular product.
D) Difference between wholesale and retail prices.
7. 22. The opportunity cost of studying for an economics test is:
A) Negative, since it may improve your grade.
B) Zero, because you knew when you registered for the class that studying
would be required.
C) The money you spent on tuition for the class.
D) The best alternative use of your time.
23. The concept of opportunity cost would become irrelevant if:
A) The market mechanism functioned to allocate resources fairly.
B) The government allocated resources.
C) The production-possibilities curve bowed outward.
D) Resources were no longer scarce.
24. A production-possibilities curve indicates the:
A) Combinations of goods and services an economy is actually producing.
B) Maximum combinations of goods and services an economy can produce given
its available resources and technology.
C) Maximum combinations of goods and services an economy can produce given
unlimited resources.
D) Average combinations of goods and services an economy can produce given
its available resources and technology.
25. Which of the following is an assumption under which the production-possibilities
curve is drawn?
A) There is significant unemployment. C) The price level is changing.
B) The supply of factors of production is fixed. D) Technology is changing.
8. 26. A point on a nation's production-possibilities curve represents:
A) An undesirable combination of goods and services.
B) Combinations of production that are unattainable, given current technology
and resources.
C) Levels of production that will cause both unemployment and inflation.
D) The full employment of resources to achieve a particular combination of
goods and services.
27. Which of the following correctly characterizes the shape of a production-possibilities
curve?
A) A straight line indicating the law of increasing opportunity costs applies.
B) A straight line when there are constant opportunity costs.
C) A line that curves outward when resources are perfectly adaptable in the
production of different goods.
D) A line that curves inward when resources are perfectly adaptable in the
production of different goods.
28. If an economy is producing on its production-possibilities curve, then producing:
A) More of one good implies producing more of another good.
B) Less of one good implies producing less of another good.
C) More of one good implies producing less of another good.
D) More of one good implies shifting the curve toward the origin.
9. 29. The production-possibilities curve illustrates:
A) The limitations that exist because of scarce resources.
B) That there is no limit to what an economy can produce.
C) That there is no limit to the level of output.
D) The existence of unlimited wants and resources.
30. The production-possibilities curve illustrates that:
A) Society can always produce more of all goods simultaneously.
B) Constant opportunity costs always exist.
C) There are no opportunity costs in a wealthy economy.
D) If society is efficient, it can produce more of one good only if it reduces
output of another good.
31. According to the law of increasing opportunity costs:
A) The more one is willing to pay for resources, the larger will be the possible
level of production.
B) Increasing the production of a particular good will cause the price of the
good to rise.
C) In order to produce additional units of a particular good, it is necessary for
society to sacrifice increasingly larger amounts of alternative goods.
D) Only by keeping production constant can rising prices be avoided.
32. The law of increasing opportunity costs explains:
A) How everything becomes more expensive as the economy grows.
B) The shape of the production-possibilities curve.
C) Inflation.
D) All of the above.
10. 33. According to the law of increasing opportunity costs:
A) Greater production leads to greater inefficiency.
B) Greater production means factor prices rise.
C) Greater production of one good requires increasingly larger sacrifices of
other goods.
D) Higher opportunity costs induce higher output per unit of input.
34. If an economy experiences increasing opportunity costs with respect to two goods,
then the production-possibilities curve between the two goods will be:
A) Bowed outward. C) A straight, downward-sloping line.
B) Bowed inward. D) All of the above are possible.
35. The production-possibilities curve bows outward because:
A) Resources are used inefficiently as more of a good is produced.
B) In order to get more of a particular good, increasing quantities of other
goods must be given up.
C) Resources move easily from the production of one good to the production of
another.
D) Resources are scarce and choices must be made.
11. 36. If the United States decides to convert automobile factories to tank production, as it
did during World War II, but finds that some auto manufacturing facilities are not well suited to
tank production, then:
A) The production-possibilities curve between tanks and automobiles will
appear as a straight line.
B) The production-possibilities curve between tanks and automobiles will shift
outward.
C) Decreasing opportunity costs will occur with greater automobile production.
D) Increasing opportunity costs will occur with greater tank production.
37. Ceteris paribus, if Korea increases the size of its military, then its:
A) Production-possibilities curve will shift outward.
B) Production-possibilities curve will shift inward.
C) Production of non-military goods will increase.
D) Production of non-military goods will decrease.
38. Ceteris paribus, if Russia decreases the size of its military, then its:
A) Production-possibilities curve will shift outward.
B) Production-possibilities curve will shift inward.
C) Production of non-military goods will increase.
D) Production of non-military goods will decrease.
12. 39. Efficiency can be defined as the:
A) Maximum resources used in producing a given output level.
B) Maximum output of a good produced from the available resources.
C) Minimum output of a good produced from the available resources.
D) Maximum output of a good produced if all resources are devoted to its
production.
40. When an economy is producing efficiently it is:
A) Producing a combination of goods and services beyond the production-
possibilities curve.
B) Getting the most goods and services from the available resources.
C) Experiencing decreasing opportunity costs.
D) All of the above.
13. 41. Which of the following is true when an economy is producing efficiently?
A) The economy is producing on the production-possibilities curve.
B) Goods and services are being produced using the fewest resources.
C) The economy is getting the most goods and services from the available
resources.
D) All of the above.
42. Every point on the production-possibilities curve is considered to be:
A) Efficient. B) An optimal level of output. C) Equally desirable. D) All of
the above.
43. In terms of the production-possibilities curve, inefficiency is represented by:
A) All points on the curve. C) All points outside the curve.
B) All points inside the curve. D) A rightward shift of the curve.
44. If an economy is producing inside the production-possibilities curve, then:
A) It does not have enough resources to be efficient.
B) It must give up some of one good to produce more of another good.
C) The curve needs to shift inward.
D) It is using its resources inefficiently.
14. 45. If an economy is producing inside the production-possibilities curve, then:
A) There is unemployment of resources.
B) It is operating inefficiently.
C) It can produce more of one good without giving up some of another good.
D) All of the above.
46. When technological change allows a smaller amount of a resource to be used in
producing two goods shown on a production-possibilities curve, there will be:
A) A movement along the production-possibilities curve.
B) An inward shift of the production-possibilities curve.
C) No change in the production-possibilities curve.
D) An outward shift of the production-possibilities curve.
47. A technological advance would best be represented by:
A) A shift outward of the production-possibilities curve.
B) A shift inward of the production-possibilities curve.
C) A movement from inside the production-possibilities curve to a point on the
production-possibilities curve.
D) A movement from the production-possibilities curve to a point inside the
production-possibilities curve.
48. Which of the following events would allow the production-possibilities curve to shift
outward, ceteris paribus?
A) The economy's capital stock grows. C) More women enter the
labor force.
B) Technology improves. D) All of the above.
15. 49. The production-possibilities curve shifts outward in response to:
A) Better technology or fewer resources or both.
B) Better technology or more resources or both.
C) Declining technology or fewer resources or both.
D) Declining technology or more resources or both.
50. Long-run economic growth would best be represented by a:
A) Shift outward of the production-possibilities curve.
B) Shift inward of the production-possibilities curve.
C) Movement from inside the production-possibilities curve to a point on the
production-possibilities curve.
D) Movement from the production-possibilities curve to a point inside the
production-possibilities curve.
51. Which of the following events would cause the production-possibilities curve to shift
outward?
A) A labor strike. C) The full employment of resources.
B) Increased efficiency in the use of resources. D) A decrease in
available resources.
52. Which of the following events would cause the production-possibilities curve to shift
inward?
A) A decrease in the supply of labor.
B) An increase in the number of factories.
C) A technological breakthrough occurs which makes production of all goods
more efficient.
D) An increase in the unemployment rate.
16. 53. Which of the following will cause the production-possibilities curve to shift inward?
A) An increase in population. C) A decrease in the size of the labor
force.
B) A technological advance. D) An increase in knowledge.
54. A decrease in available resources would cause:
A) An economy to move inside its production-possibilities curve.
B) The production-possibilities curve to shift inward.
C) Opportunity costs to increase.
D) The unemployment of resources.
55. The availability of fewer resources can be represented by:
A) An inward shift of the production-possibilities curve.
B) No change in the production-possibilities curve.
C) A movement along the production-possibilities curve.
D) An outward shift of the production-possibilities curve.
56. Which of the following is not a basic decision that all nations must confront?
A) Should we have economic growth?
B) How should we produce goods and services?
C) For whom should goods and services be produced?
D) What goods and services should we produce?
57. In a market economy, the question of WHAT to produce is answered by:
A) Direct negotiations between consumers and producers.
B) Producer profits and sales.
C) Government directives.
D) A democratic vote of all producers.
17. 58. In a market economy, the question of HOW to produce is determined by:
A) Government planners.
B) The production possibilities curve.
C) The least-cost method of production.
D) The method of production which uses the least amount of labor.
59. In a market economy, the people who receive the goods and services that are produced are
those who:
A) Need the goods and services the most. C) Have the most political power.
B) Want the goods and services the most. D) Are willing to pay the highest price.
60. The market mechanism may best be defined as:
A) Price regulation by government.
B) The use of market signals and government directives to select economic
outcomes.
C) The process by which the production-possibilities curve shifts inward.
D) The use of market prices and sales to signal desired output.
61. The market mechanism:
A) Allows buyers to communicate with producers indirectly.
B) Is directed by the government in order to promote efficiency.
C) Results in the misallocation of resources because producers seek to
maximize profits.
D) Allocates goods in an equitable manner.
18. 62. The market mechanism:
A) Is not a very efficient means of communicating consumer demand to the
producers of goods and services.
B) Works through central planning by government.
C) Eliminates market failures created by government.
D) Works because prices serve as a means of communication between
consumers and producers.
63. The invisible hand refers to:
A) Intervention in the economy by the government bureaucrats we do not see
and over whom we have no control.
B) Undiscovered natural resources.
C) The allocation of resources by market forces.
D) The person who has the responsibility to coordinate all the markets in a
market economy.
64. The doctrine of laissez faire is based on the belief that:
A) Markets are likely to do a better job of allocating resources than government
directives.
B) Government directives are likely to do a better job of allocating resources
than markets.
C) Government failure does not exist.
D) Markets result in an unfair distribution of income.
19. 65. Which of the following would advocate a laissez faire economic policy?
A) Karl Marx. B) Adam Smith. C) John Maynard Keynes. D) President
Franklin Roosevelt.
66. Karl Marx wrote:
A) The Wealth of Nations, which provided the rationale for centrally-planned
economies.
B) The Wealth of Nations, which described the virtues of market-based
economies.
C) Das Kapital, which provided the rationale for centrally-planned economies.
D) Das Kapital, which described the virtues of market-based economies.
67. Karl Marx believed that the best use of resources would result from:
A) Government directives.
B) Laissez faire policies.
C) Production decisions based on costs alone.
D) A mixture of government directives and market signals.
68. A city's decision to control apartment rents is an example of:
A) The invisible hand at work. C) The market mechanism at work.
B) Market failure. D) Government intervention.
69. In a mixed economy like that in the United States, the question of WHAT to produce is
determined by:
A) Government directives only.
B) Price signals and sales in markets only.
C) Both government directives, and price signals and sales in markets.
D) The invisible hand only.
20. 70. A mixed economy:
A) Is justified by the superiority of laissez faire over government intervention.
B) Utilizes both market and nonmarket signals to allocate goods and services.
C) Relies on the use of central planning by private firms rather than the
government.
D) All of the above.
71. Which of the following is the most appropriate way to match different economic
systems with their corresponding failures?
A) Market failures with command economies.
B) Government failures with market economies.
C) Market failures and government failures with mixed economies.
D) Neither market nor government failure in a purely capitalist economy.
72. Which of the following can be used to correct market failure?
A) The market mechanism. C) Laws and regulations.
B) Laissez-faire price policies. D) All of the above.
73. When the invisible hand does not produce optimal outcomes for the economy, there is
evidence of: (A) Government failure. B) Market failure. C) Macroeconomic failure.
(D) Scarcity.
74. Government intervention may achieve a more optimal outcome than the market
mechanism when addressing:
A) Inefficient bureaucracy.
B) Lack of incentive to try new products or technologies.
C) Pollution.
D) All of the above.
21. 75. Pollution is an example of:
A) Inefficient operation by the firm that is polluting.
B) Market failure.
C) The ability of central planning to provide the optimal quantities of goods.
D) All of the above.
76. If market signals result in pollution beyond the optimal level then:
A) The economy experiences government failure.
B) A laissez-faire approach will reduce the level of pollution.
C) The market mechanism has failed.
D) The government is allocating resources inefficiently.
77. The collapse of communism is evidence of:
A) Ceteris paribus. C) Government failure.
B) Market failure. D) The failure of a mixed economy.
78. When government directives do not produce better economic outcomes, which of the
following has occurred?
A) Government failure. B) Market failure. C) Macroeconomic failure.
D) Scarcity.
79. Which of the following is an example of government failure?
A) Bureaucratic delays.
B) Required use of pollution-control technologies that are obsolete.
C) Inefficient incentives.
D) All of the above.
22. 80. Macroeconomics focuses on the performance of:
A) Individual consumers. B) The overall economy. C) Government agencies.
D) All of the above.
81. Macroeconomics focuses on the performance of:
A) Individual consumers. C) Government agencies.
B) Specific firms. D) The economy as a whole.
82. Which of the following is a macroeconomic statement?
A) The unemployment rate for the United States rose to 7 percent in the last
quarter.
B) The price of wheat fell to a ten year low in July.
C) Unionized workers struck GM for higher wages.
D) All of the above.
83. Which of the following are classified as microeconomic goals?
A) Full employment, price stability, growth in output.
B) The welfare of individual consumers and business firms.
C) Production, pricing, and purchasing.
D) Land, labor, and capital.
84. The study of microeconomic theory focuses on the:
A) Interaction of international trade and domestic production of goods and
services.
B) Operation of the entire economy.
C) Role of the banking system in the economy.
D) Structure and performance of markets and the operation of the price
system.
23. 85. Microeconomics is concerned with issues such as:
A) The demand for CD players by individuals. C) Maintaining a
strong level of economic growth.
B) The level of inflation in the economy. D) All of the above.
86. Economic models are used by economists to:
A) Predict economic behavior. C) Formulate economic policy.
B) Explain economic behavior. D) All of the above.
87. The Latin phrase ceteris paribus means:
A) The production-possibilities curve never shifts. C) Other things
remain equal.
B) Laissez faire. D) The invisible hand.
88. The ceteris paribus assumption:
A) Is necessary because of the complexity of the real economy.
B) Makes it easier to formulate economic theory and policy.
C) Increases the risk of errors in economic predictions.
D) All of the above are correct.
24. Use the following to answer questions 89-94: Production-possibilities curve
89. Society is employing some of its available resources but not all of them.
A) A. B) B. C) C. D) D.
90. Society is not able to produce either good because it is so inefficient. (See Figure 1.1.)
A) A. B) B. C) C. D) D.
91. Society is producing the most output possible with the available resources and
technology. (See Figure 1.1.)
A) A. B) B. C) C. D) D.
92. Society might be able to produce this combination if technology improved but cannot
produce it with current technology. A) A. B) B. C) C. D) D.
93. Society is producing some of each type of structure but it is still inefficient.
A) A. B) B. C) C. D) D.
94. Society cannot produce this combination with existing resources and technology.
A) A. B) B. C) C. D) D.
25. Production-possibilities curves
95. Choose the letter of the curve in Figure 1.2 that best represents a production possibilities
curve for two goods that use entirely different resources and for which the resources can in
no way be adapted from the production of one good to the other.
A)A. B) B. C) C. D) D.
96. Choose the letter of the curve in Figure 1.2 that best represents a production-
possibilities curve for two goods that obey the law of increasing opportunity costs.
A) A. B) B. C) C. D) D.
97. Choose the letter of the curve in Figure 1.2 that best represents a production-
possibilities curve for two goods for which there are constant opportunity costs.
A) A. B) B. C) C. D) D.
26. • B
• E 98. Using Figure 1.3, an increase in the capacity
• D to produce can be represented by a
• movement from:
OUTPUT OF TANKS
C
A) Point A to point B. B) Point B to
• A
point C. C) Point A to point C.
D) Point C to point F.
• F
PP1 PP2
OUTPUT OF AUTOMOBILES
99. Using Figure 1.3, at point A:
A) There is inefficient use of available resources.
B) The available technology keeps production inside PP1.
C) All available resources are being used efficiently.
D) An increase in the production of tanks would definitely require a decrease in
the production of automobiles
100. Which of the following is true about the combination of tanks and automobiles
represented by point E in Figure 1.3?
A) This economy will never be able to reach point E.
B) Point E is reachable if this economy uses more of its available resources.
C) Point E is reachable if this economy becomes more efficient.
D) Point E is reachable only if more resources become available or
technological advances are made.