Remaining: Remaining: Question 1. 1. Market economies are distinguished from other types of economies largely on the basis of (Points : 5) the political affiliations of government officials. the process by which government officials are elected or appointed. the ways in which scarce resources are allocated. the number of retail outlets available to consumers. Question 2. 2. The phrase “no such thing as a free lunch” means (Points : 5) people must face tradeoffs. rational people think at the margin. people respond to incentives. trade can make everyone better off. Question 3. 3. Which of the following is a correct statement about production possibilities frontiers? (Points : 5) An economy can produce only on the production possibilities frontier. An economy can produce at any point inside or outside a production possibilities frontier. An economy can produce at any point on or inside the production possibilities frontier, but not outside the frontier. An economy can produce at any point inside the production possibilities frontier, but not on or outside the frontier. Question 4. 4. In the simple circular-flow diagram, the participants in the economy are (Points : 5) firms and government. households and firms. households and government. households, firms, and government. Question 5. 5. US citizens have better nutrition, better healthcare, and a longer life expectancy than citizens of Ghana. Which of the following conclusions can be drawn from this statement? (Points : 5) Average income in the US is higher than the average income in Ghana. The US has a higher standard of living than Ghana. Productivity in the US is higher than productivity in Ghana. All of the above are correct. Question 6. 6. Table 2-5 Cookies (in dozens) Coffee (in pounds) 1000 0 800 350 600 650 400 800 200 1000 0 1150 Refer to Table 2-5. Table 2-5 shows one set of production possibilities. Which of the following statements is correct? (Points : 5) The opportunity cost of a dozen cookies does not depend on how many pounds of coffee are being produced. The opportunity cost of a dozen cookies increases as more cookies are produced. The opportunity cost of a dozen cookies decreases as more cookies are produced. The opportunity cost of a pound of coffee decreases as more coffee is produced. Question 7. 7. Senator Bright, who understands economic principles, is trying to convince workers in her district that trade with other countries is beneficial. Senator Bright should argue that trade can be beneficial (Points : 5) only if it allows us to obtain things that we couldn't make for ourselves. because it allows specialization, which increases total output. to us if we can gain and the others involved in the trade lose. in only a limited number of circumstances becaus ...