111midterm

A key determinant of the price elasticity of supply is the

time horizon.

A competitive market is a market in which

no individual buyer or seller has any significant impact on the market price.

A survey of professional economists revealed that more than three-fourths of them agreed with fourteen economic propositions. Which of the following is not one of those propositions?

The United States should withdraw from the North American Free Trade Agreement (NAFTA).

After much consideration, you have chosen Ireland over Spain for your Study Abroad program next year. However, the deadline for your final decision is still months away and you may reverse this decision. Which of the following events could prompt you to reverse this decision?

The marginal benefit of going to Spain increases.

A typical society strives to get the most it can from its scarce resources. At the same time, the society attempts to distribute the benefits of those resources to the members of the society in a fair manner. However, redistributing income from rich to poor reduces the reward for working hard. Therefore, society faces a tradeoff between

d.efficiency and equality.

A popular celebrity that is paid highly for her time should probably not mow her own lawn because

her opportunity cost of mowing her lawn is higher than the cost of paying someone to mow it for her.

According to the circular-flow diagram, if Jalyssa is a worker who delivers flowers for Happy Day Flower Company, she participates

in the markets for factors of production exchanging labor for income.

Another term for factors of production is

inputs

A farmer has the ability to grow either corn or cotton or some combination of the two. Given no other information, it follows that the farmer's opportunity cost of a bushel of corn multiplied by his opportunity cost of a bushel of cotton

is equal to 1.

A baker recently has come to expect higher prices for bread in the near future. We would expect

the baker to supply less bread now than she was supplying previously.

Both the production of goods and services and the unemployment rate are used to measure

a.the business cycle.

Analysis of data on workers and those looking for work is conducted by economists at the

b. Department of Labor.

Absolute advantage is found by comparing different producers'

b.input requirements per unit of output..

A decrease in supply will cause the largest increase in price when

both supply and demand are inelastic.

A good will have a more inelastic demand, the

broader the definition of the market.

A decrease in the price of a good will

decrease quantity supplied.

Candice is planning her activities for a hot summer day. She would like to go to the local swimming pool and see the latest blockbuster movie, but because she can only get tickets to the movie for the same time that the pool is open she can only choose one activity. This illustrates the basic principle that

people face tradeoffs.

A demand schedule is a table that shows the relationship between

price and quantity demanded.

Cross-price elasticity of demand measures how

the quantity demanded of one good changes in response to a change in the price of another good.

A production possibilities frontier is bowed outward when

the rate of trade-off between the two goods being produced depends on how much of each good is being produced.