ECO 151 SURVEY OF ECONOMICS - MINE MODULE 1 Economics and the U.S. Economy CH. 1 The Challenge of Economics CH 2 The U.S. Economy

63. The economic question of '_____ to produce' is about decisions related to the mix of factor inputs (land, labor, capital...) used to produce goods and services. Multiple choice question. how what for whom when

HOW

12. Select all that apply Which of the following are the three critical questions that an economic system must address? Multiple select question. How to produce? What to produce? For whom to produce? When to produce?

How to produce? What to produce? For whom to produce?

58. When excessive regulation inhibits production, raises product prices, and limits consumer choices, the result is: Multiple choice question. production regulation capital-intensive regulation government failure market failure

government failure

67. Government intervention that fails to improve economic outcomes is called a: Multiple choice question. government failure market failure mixed economy market economy

government failure

45. Decisions such as increasing the share of military spending, how many interstate highways to build, and how many Head Start classes to offer are made through Blank______. Multiple choice question. the market mechanism central planning the political process

the political process

42. An economy that uses a combination of government directives and market mechanisms is known as a Blank______. Multiple choice question. mixed economy laissez-faire economy market mechanism economy central planning economy

mixed economy

An economy that uses a combination of government directives and market mechanisms is known as a ______. Multiple choice question. market mechanism economy mixed economy laissez-faire economy central planning economy

mixed economy

Calculate the slope between points J and K Study Time Grade Point Average

1/6 Slope = vertical distance between two points/horizontal distance between two points

71. Calculate the slope between points X and Y. Multiple choice question. 8 1/6 1/8 1/4 4 6

1/8

34. According to Figure 2.2, in 2020 spending on government services by state and local government was ______ percent of GDP. Multiple choice question. 12 8 13 20

12

61. Select all that apply The president(s) who supported a less active role for the government are: Multiple select question. George W. Bush Bill Clinton Barack Obama Donald Trump Joe Biden

George W. Bush Donald Trump

14. GDP is the total value of all ___________goods and services produced within a nation's borders in a given time period. * final** * unfinished * intermediate * non-exported

final GDP only includes FINAL goods and services

62. In the "distribution by quintiles" method of showing income inequality, the total number of households is divided into ____________equally sized groups.

five or 5

5. The government has an impact on the HOW to produce question when it does all of the following EXCEPT * sets a minimum wage * limits enviromental pollution * forbids the use of child labor * follows a policy of laissez-faire**

follows a policy of laissez-faire If the government followed the doctrine of laissez-faire (hands off), it would not be involved in the HOW to produce question.

imports

goods and services purchased from foreign sources.

exports

goods and services sold to foreign buyers.

46. Government intervention that fails to improve economic outcomes is called a: Multiple choice question. mixed economy market economy market failure government failure

government failure

10. The total market value of all final goods and services produced within a nation's borders in a given time period is: Multiple choice question. economic growth per capita GDP gross domestic product human capital

gross domestic product

3. The total value of all final goods and services produced within the borders of a given country during a given period of time is the definition of: Multiple choice question. national income gross private domestic investment gross domestic product gross national product

gross domestic product

20. The major uses of total output include: Multiple choice question. household consumption, business investment, and government services household consumption, business investment, government transfer payments, and imports demand and supply household consumption, business investment, government services, and exports

household consumption, business investment, government services, and exports

9. Which of these is NOT one of the three basic economic questions? * how to produce * how much to charge** * for whom to produce * what to produce

how much to charge WHAT, HOW, and FOR WHOM to produce are the three basic economic questions

13. Manny is attending college and majoring in economics. Manny is improving his scarce resource of: A. land. B. labor. C. capital. D. human capital. E. natural resources.

human capital.

33. Net exports is exports minus _____________

imports or import

42. Because _____________exceed exports, net exports are a negative percentage of total GDP.

imports or import

12. Nominal GDP measures the value of all goods and services Blank______. Multiple choice question. adjusted for inflation in terms of the value of dollars in the base year that are not available for international trade in terms of the current value of dollars

in terms of the current value of dollars

10. Consumer goods * account for the smallest portion of U.S. GDP * include expenditures for durable goods, nondurable goods, and services** * include government expenditure on welfare and food stamps * account for half of total U.S. output

include expenditures for durable goods, nondurable goods, and services The vast array of products consumers purchase is classified as either durable goods, nondurable goods, or services

36. Social Security payments, welfare payments, and veterans' payments that the government makes directly to households are examples of ____________transfers.

income

72. Taxes and Blank______ are two primary mechanisms for the government to redistribute incomes in the U.S. Multiple choice question. income mobility price ceilings income transfers economic growth globalization

income transfers Reason: Unfortunately, economic growth does not necessarily translate to poverty alleviation. It may only widen the gap between the rich and the poor. Nearly all the reduction in income inequality in the U.S. is attributable to transfer payments.

25. Military spending _____ in the three years after 9/11. Multiple choice question. decreased initially decreased but then increased stayed the same increased

increased

Module 1 Practice Test 1. Microeconomics deals with: A. the working of the entire economy or large sectors of it. B. economic growth. C. government economic policy. D. gross domestic product. E. individual units in the economy.

individual units in the economy.

26. The types of investment include all final purchases of machinery, equipment, and tools; all construction of new plants; and changes in business _______ .

inventories or inventory

23. According to Figure 2.2, in 2018, _____________ made up 13% of GDP.

investment Blank 1: Investment or Investments

48. The branch of economics that studies the economy as a whole or in the aggregate is known as: Multiple choice question. positive economics microeconomics economics macroeconomics normative economics

macroeconomics

____________is the discipline that examines either the economy as a whole or in the aggregate.

macroeconomics Macroeconomics or Macro

53. A(n) _________ failure is an imperfection in the market mechanism that prevents optimal outcomes. (Enter only one word in the blank.)

market

An imperfection in the market mechanism that prevents optimal outcomes is called a: Multiple choice question. government failure market economy mixed economy market failure

market failure

57. The branch of economics that studies the decision-making process of individual workers, households, and firms (i.e., individual components of the larger economy) is known as: Multiple choice question. labor economics positive economics macroeconomics normative economics microeconomics

microeconomics

51. An economy that uses a combination of government directives and market mechanisms to determine economic outcomes is called a(n) economy. (Use one word for the blank.)

mixed

71. The movement of households from one income group to another over time is called income __________________

mobility

12. The invisible hand refers to the price signal in a free market economy T/F

TRUE No direct communication is needed between the producer and the consumer

14. Select all that apply According to Figure 2.1, which countries had GDP greater than $8 trillion for the year shown? Multiple select question. Germany United States Great Britain China Japan Colombia old_figure_2.1_GDP(6681578e).jpg Text Alternative The data is as follows: United States, 19.39 (highlighted); China, 12.24; Japan, 4.87; Germany, 3.68; Britain, 2.62; India, 2.60; Russia, 1.58; Mexico, 1.15; Venezuela, 0.21; Greece, 0.20, and Haiti, 0.01.

United States China

MODULE ! QUIZ 1. Because of scarcity * there are not enough goods and services to satisfy everyone * there are plenty of goods to go around * choices must be made * **Both choices must be made and there are not enough goods to satisfy everyone

both choices must be made AND there are not enough goods to satisfy everyone Both of these things are true of scarcity

38. A good or service sold to foreign buyers is Multiple choice question. an import consumer spending an export government spending

an export

40. A good or service purchased from foreign sources is Blank______. Multiple choice question. consumer spending government spending an export an import

an import

20. Which of the following is an example of government failure? * an increase in bureaucracy and red tape that fails to improve economic outcomes * an increase in airline safety * an increase in the costs of production and an improvement in economic outcomes * a negative externality, such as pollution

an increase in bureaucracy and red tape that fails to improve economic outcomes An increase in bureaucratic red tape may burden private industry and reduce the total amount of output

economic growth

an increase in output (real GDP); an expansion of production possibilities.

Select all that apply Which of the following are used by economists to define and/or measure economic growth? Multiple select question. an increase in real GDP occurring over some time period an increase in nominal GDP occurring over some time period an expansion of production possibilities occurring over some time period an increase in nominal GDP per capita occurring over some time period

an increase in real GDP occurring over some time period an expansion of production possibilities occurring over some time period

Economists define and measure economic growth as: Multiple choice question. an increase in capital stock per capita over time an increase in real GDP over time an increase in nominal GDP over time an increase in nominal GDP per capita over time

an increase in real GDP over time

Who owns most property resources under central planning? Multiple choice question. Corporations The top 1% Government Private individuals

government government owns most property resources in a command system

3. Economics is concerned with figuring out ways to allocate ____________ resources in the best possible way.

scarce

10. Economics is concerned with how to allocate ____________ resources to meet the unlimited wants of the members of a given society. (Use one word in the blank)

scarce scarce, limited, insufficient, or finite

63. The concept that "there is no free lunch" reflects the notion that: Multiple choice question. unlimited resources are used to produce so-called "free goods" that are given up in order to produce said "free" goods. the benefit of certain "free" goods accrues only to society. the benefit of certain "free" goods accrues only to individuals. scarce resources are used to produce so-called "free goods" that have alternative uses that are given up in order to produce said "free" goods.

scarce resources are used to produce so-called "free goods" that have alternative uses that are given up in order to produce said "free" goods.

16. Per capita GDP is: Multiple choice question. GDP + population (GDP) x (population) GDP - population GDP/population

GDP/population

Per capita GDP is: Multiple choice question. GDP/population (GDP) x (population) GDP + population GDP - population

GDP/population

22. In Figure 2.2 for 2020, consumption accounted for approximately Blank______% of GDP. Multiple choice question. 12 13 71 20 8

71

ceteris paribus

The assumption that nothing else changes

monopoly

a firm that produces the entire market supply of a particular good or service.

27. In general, one specific mix of output is _________ for a country.

best/optimal/

64. A graph is a visual representation of _________ data.

observed or empirical

10. We are forced to make choices because of: A. exploitation. B. efficiency. C. scarcity. D. the margin. E. ceteris paribus.

scarcity.

Select all that apply Gross domestic product can be described as: Multiple select question. the total market value of all final goods and services produced within a nation's borders in a given time period an increase in output or an expansion of production possibilities the size of the "pie" that is baked each year by a country how the "pie" baked each year is sliced

the total market value of all final goods and services produced within a nation's borders in a given time period the size of the "pie" that is baked each year by a country

gross domestic product (GDP)

the total value of final goods and services produced within a nation's borders in a given time period.

nominal GDP

the total value of goods and services produced within a nation's borders, measured in current prices.

personal distribution of income

the way total personal income is divided up among households or income classes.

2. Macroeconomics deals with: A. bits and pieces of the economy. B. the question of how a business unit should operate profitably. C. the working of the entire economy D. how individuals make decisions. E. government regulation of immigration laws.

the working of the entire economy

18. On average, U.S. real GDP has grown roughly ______percent per year * seven * one * five * three**

three Due to America's technological advancements, real GDP increases by 3 percent per year

8. The basic concern of economics is: A. to keep business firms from losing money. B. to prove that capitalism is better than socialism. C. to study the choices people make. D. to use unlimited resources to produce goods and services to satisfy limited wants. E. to increase the amount of wealth in the economy.

to study the choices people make.

Ch. 1 Homework 1. Point Use the graph to answer two questions Iceland PPC Output of Military Goods Iceland has no military a. So, at what point in the figure is Iceland producing? X,A,B,C **A** b. If Iceland decided to produce the quantity OE of military goods, how much consumer output would it have to give up? **AD** Give up quantity OE, AO, FO, EB, AD, DF

* At what point in the figure is Iceland producing? Point A * If Iceland decided to produce the quantity of OE military goods, how much consumer output would it have to give up? **AD** Take OE to C difference is AD a. If the country currently does not have a military, then the only output will be consumer goods (point A) b. If the country is now producing OE military goods (equal to the combination of D consumer goods and E military goods), the country would reduce the production of consumption goods by the amount AD.

4. According to the News Wire, what is the opportunity cost of a single missile test in terms of corn for each of North Korea's 26 million people? Instructions: Round your response to two decimal places ______ ton (s) of corn per person

0.19 tons of corn per person Explanation: According to the article, the $1.3 billion spent on the missile test is equivalent to acquiring 5 million tons of corn. This amounts to 0.19 tons of corn per person (=5 million tons of corn/26 million people).

Ch. 2 Homework 1. Use the figure above to answer the following questions. Instructions: Enter your response as a whole number. a. What is the opportunity cost of increasing investment from 6 units to 8 units? 3 units of consumer goods b. What will happen to future production possibilities if investment increases now? Production possibilities will increase c. What will happen to future production possibilities if only consumer goods are produced now? Production possibilities will decrease

1. Opportunity cost is cost of the next best alternative. The opportunity cost of producing more of investment goods, is producing less of consumer goods. This is because the resources are scarce. a. Moving from a point A to point B, where the production of investment goods increases from 6 to 8 units, the consumer goods foregone is 3 units ( from 6 to 3 units). Thus the opportunity cost of investment good from 6 units to 8 units is 3 units of consumer goods. b. When the investment in the economy increases, the PPF would shift outwards as the capital investment which is a factor of production increases and the economy could reach at a higher point on PPF. Production possibilities will INCREASE Option C is correct. c. When only consumer goods are produced, the factors of production/capital stock used to produce investment goods are not used, as a result the machinery wears out. As a result, the PPF would shift inwards. Production possibilities will DECREASE Option B is correct.

The slope between points M and N is equal to ______. Multiple choice question. 4 1/6 1/4 6

1/4

66. Multiple Choice Question Calculate the slope between points W and X. Multiple choice question. 1/4 8 4 1/8 6 1/6

1/6

Calculate the slope between points W and X. Multiple choice question. 6 4 1/4 1/8 1/6 8

1/6

4. In the linear production-possibilities model, we assume each of five equally-sized parcels of land contributes the same to the production of food and timber: 6 units of timber or 3 units of food By contrast, in the nonlinear model, we will assume that there are five different types of land in equal-sized plots and that each plot may contribute as follows to the production of food or timber: Assuming all land is equally productive in either use, how much output of each type will be produced with 1/5 of the land in timber production and 3/5 of the land in food production?

12 units of timber and 9 units of food

32. According to Figure 2.2, investment accounted for _____ percent of GDP in 2020. Multiple choice question. 71 12 13 20 8 -4

13

65. Given the figure, if a student studies 10 hours per week, their grade point average is equal to: Multiple choice question. 2.0 3.5 2.5 3.0 1.0 old_Figure A1(7063720e).jpg Text Alternative The horizontal axis ranges from 0 through 20 in increments of 1. The vertical axis ranges from 0 (equals F) through 4.0 (equals A). The data is as follows: The curve increases from (0, 0) to (16, 4.0) through (8, 2.0) at M and (12, 3.0) at N. The dashed line from M to (12, 2.0) is labeled as "4 hours of study time" and N to (12, 2.0) is labeled as 1.0 grade point. Note: All data is approximate.

2.5

74. Given the figure, if a student studies 10 hours per week, their grade point average is equal to: Multiple choice question. 3.0 1.0 3.5 2.0 2.5 old_Figure A1(7063720e).jpg Text Alternative The horizontal axis ranges from 0 through 20 in increments of 1. The vertical axis ranges from 0 (equals F) through 4.0 (equals A). The data is as follows: The curve increases from (0, 0) to (16, 4.0) through (8, 2.0) at M and (12, 3.0) at N. The dashed line from M to (12, 2.0) is labeled as "4 hours of study time" and N to (12, 2.0) is labeled as 1.0 grade point. Note: All data is approximate.

2.5

25. According to Figure 2.2, in 2020, total spending on government services was Blank______ percent of GDP. Multiple choice question. 13 20 12 8

20

70. A quintile is ________percent of the total number.

20 or twenty

56. Given the figure, if a student studies 14 hours per week, their grade point average is equal to: Multiple choice question. 2.0 2.5 1.0 3.0 3.5 old_Figure A1(7063720e).jpg Text Alternative The horizontal axis ranges from 0 through 20 in increments of 1. The vertical axis ranges from 0 (equals F) through 4.0 (equals A). The data is as follows: The curve increases from (0, 0) to (16, 4.0) through (8, 2.0) at M and (12, 3.0) at N. The dashed line from M to (12, 2.0) is labeled as "4 hours of study time" and N to (12, 2.0) is labeled as 1.0 grade point. Note: All data is approximate.

3.5

70. Given the figure, if a student studies 14 hours per week, their grade point average is equal to: Multiple choice question. 1.0 2.5 2.0 3.0 3.5 old_Figure A1(7063720e).jpg Text Alternative The horizontal axis ranges from 0 through 20 in increments of 1. The vertical axis ranges from 0 (equals F) through 4.0 (equals A). The data is as follows: The curve increases from (0, 0) to (16, 4.0) through (8, 2.0) at M and (12, 3.0) at N. The dashed line from M to (12, 2.0) is labeled as "4 hours of study time" and N to (12, 2.0) is labeled as 1.0 grade point. Note: All data is approximate.

3.5

2. Assume that it takes four hours of labor time to paint a room and two hours to sand a floor. If 24 hours were spent painting: Instructions: Enter your responses as a whole number a. How many rooms could be painted? ________ room (s) 6 b. If a decision were made to sand two floors, how many painted rooms would have to be given up? 1 ______ room (s)

6 rooms 1 room a. If 24 hours were spent painting rooms and a worker can paint a room in four hours, then this worker can paint six rooms (-24 hours-4 hours per room). b. Because it takes two hours to sand a floor, it would take a worker four hours to sand two floors. Therefore, the worker must give up painting one room, which also takes four hours to complete.

76. Your most challenging concepts Explain the economic question of "what to produce." Identify a point on a graph. Recall that a graph shows an empirical relationship.

66 of 75

13. Select all that apply Which of the following is an example of a consumer good? Multiple select question. An assembly line at Ford A TV set The textbook for this course A military jet

A TV set The textbook for this course

25. A college student is faced with a difficult decision of how to spend one hour tonight. She could babysit her professor's child at an hourly wage of $7, she could work at the college library at a wage of $6, or she could finish her economics homework assignment. If she chooses to complete her homework assignment, she has incurred an opportunity cost equal to: A. $7. B. $6. C. $13. D. $0. E. $42

A. $7.

32. Which of the following would be a normative economic statement? A. Government has grown too large and should be reduced. B. There has been an increase in the rate of inflation. C. Government is subject to the same rules as all other institutions. D. All of these are normative economic statements. E. None of these are normative statements.

A. Government has grown too large and should be reduced.

38. Which of the following would most likely be a microeconomic question? A. Should I go to business school or take a job? B. Have wages been rising more slowly than consumer prices have been rising? C. What government policies should be adopted to promote full employment and growth in the economy as a whole? D. What determines the level of output for the economy as whole? E. If taxes are lowered, with the national debt rise or fall?

A. Should I go to business school or take a job?

33. Which of the following is an example of a positive statement? A. The poverty rate is 4%. B. A high rate of economic growth is good for the country. C. Everyone in the country needs to save money for retirement. D. Basketball players should not be paid higher salaries than teachers. E. Marijuana should be legalized, taxed, and sold like alcohol and tobacco.

A. The poverty rate is 4%.

36. A statement that says that the minimum wage needs to be increased is a: A. positive statement. B. normative statement. C. "other things equal" assumption. D. scientific conclusion based on marginal analysis. E. statement of fact.

B. normative statement.

28. Which of the following statements is a positive statement? Which is a normative statement? X. The federal minimum wage is increasing to $6.50 an hour. Y. The minimum wage should be high enough that families will not live in poverty. Z: A higher minimum wage typically increases the unemployment rate for teenagers. A. X is positive; Y is normative; Z is positive B. X is positive; Y is positive; Z is positive C. X is normative; Y is positive; Z is normative D. X is normative; Y is normative; Z is normative E. X is positive; Y is normative; Z is normative

A. X is positive; Y is normative; Z is positive

35. The current rate of unemployment is 5%. This statement: A. is positive. B. is normative. C. involves a value judgment. D. is a personal reflection and has no value in economics. E. is a testable hypothesis

A. is positive.

14. "In Ventura County, California, strawberry production is limited by the number of acres suitable for agriculture production." This statement best represents the economic concept of: A. resources are scarce. B. "how much?" is a decision at the margin. C. there are gains from trade. D. resources should be used as efficiently as possible to achieve society's goals. E. government policies can change spending.

A. resources are scarce.

16. "In Colorado, there has been a drought, and rural communities are fighting with urban areas over water." This statement best represents the economic concept of: A. resources are scarce. B. resources should be used as efficiently as possible to achieve society's goals. C. when markets don't achieve efficiency, government intervention can improve society's welfare. D. government policies can change spending. E. markets usually lead to efficiency.

A. resources are scarce.

26. You decide to join the economics club, but this means you can't join the accounting club because it meets at the same time. This statement best represents the economic concept of: A. the real cost of something is what you must give up to get it. B. "how much?" is a decision at the margin. C. people usually exploit opportunities to make themselves better off. D. there are gains from trade. E. markets move toward equilibrium.

A. the real cost of something is what you must give up to get it.

29. Which of the following is an example of normative economics? A. The minimum wage has not kept pace with inflation. B. The minimum wage is an important tool in fighting poverty and should be increased. C. The minimum wage creates higher unemployment for teens and unskilled workers. D. A higher minimum wage is expected to increase the price of a fast-food cheeseburger. E. The purchasing power of the minimum wage has declined over time.

B. The minimum wage is an important tool in fighting poverty and should be increased.

30. Which of the following would be a positive economic statement? A. Government has grown too large and should be reduced. B. There has been an increase in the rate of inflation. C. Government should be subject to the same rules as all other institutions. D. Women should be paid as much as men for the same work. E. Corporate CEO's are overcompensated and corrupt.

B. There has been an increase in the rate of inflation

27. The student center on campus has burritos, bagels, or burgers for lunch. You decide to have a burger today, but if they had been out of burgers, you would have bought a bagel. Your opportunity cost is the: A. burger. B. bagel. C. burrito. D. bagel and burrito. E. burger, bagel, and burrito

B. bagel.

19. The local Taco Hut charges the same price for everything on its menu: $3 will buy a taco, or a burrito, or nachos. You buy the taco and think that if you had not purchased the taco, you would have purchased the burrito. The opportunity cost of the taco is: A. the $3. B. the burrito. C. the $3 and the burrito. D. the $3, the burrito, and the nachos. E. the nachos.

B. the burrito.

21. The cost of leaving a championship soccer match before it ends is ________, while the cost of staying for the entire match is ________. A. the opportunity cost of not seeing the winning goal with two minutes to go; zero—the ticket to the match is already paid so there is no cost B. the opportunity cost of not seeing the winning goal with two minutes to go; the opportunity cost of what else you could have done during that time C. zero—you don't have to pay to leave; zero—the ticket to the match is already paid so there is no cost D. the cost of the ticket; also the cost of the ticket E. zero—you don't have to pay to leave; the opportunity cost of what else you could have done during that time

B. the opportunity cost of not seeing the winning goal with two minutes to go; the opportunity cost of what else you could have done during that time

52. Select all that apply The president(s) who supported a more active role for the government are: Multiple select question. George W. Bush Bill Clinton Barack Obama Donald Trump Joe Biden

Bill Clinton Barack Obama Joe Biden

67. When a curve shifts, the underlying relationship between two variables has___________

Blank 1: changed or shifted

44. The most dramatic change in industry structure in the U.S. over the last 100 years has been the decline in the relative size of the _________sector.

Blank 1: farm, farming, agriculture, or agricultural

49. Net exports is exports minus

Blank 1: imports or import

68. The figure shows a (one word) curve which means the slope changes as you move along the curve.

Blank 1: nonlinear or non-linear

73. A graph is a visual representation of ______________data

Blank 1: observed or empirical

11. Select all that apply Which of the following are the four major uses of total output? (Select all that apply.) Multiple select question. Money Business investment Exports Stocks and bonds Government services Household consumption

Business investment Exports Government services Household consumption

23. A new startup airline is offering free round-trip tickets to anywhere to the first 600 people who enter the office on the airline's first day of business. You arrive 24 hours before they are scheduled to open to be sure to get the free tickets, and you buy food from vendors while waiting in line. The cost of the tickets to you is: A. zero. B. just the cost of food while you wait in line. C. the cost of food while you wait in line plus the opportunity cost of your time. D. the actual value of the ticket. E. the cost of food while you wait in line plus the opportunity cost of your time plus the actual value of the ticket.

C. the cost of food while you wait in line plus the opportunity cost of your time

31. An example of a positive statement is: A. the rate of unemployment should be 4%. B. a high rate of economic growth is good for the country. C. the federal government spends half of its budget on national defense. D. everyone in the country needs to be covered by national health insurance. E. the size of the federal beauracracy has grown beyond its usefulness.

C. the federal government spends half of its budget on national defense.

24. The cost of going to college is: A. tuition and the cost of housing. B. tuition, the cost of housing, and the cost of books. C. tuition, the cost of housing, the cost of books, and forgone income. D. forgone income only. E. tuition only.

C. tuition, the cost of housing, the cost of books, and forgone income.

18. Khalil is offered a free ticket to the opera. His opportunity cost of going to the opera is: A. zero—the tickets were free. B. the price listed on the ticket. C. whatever Khalil would have done had he not gone to the opera. D. the price listed on the ticket plus whatever Khalil would have done had he not gone to the opera. E. the price listed on the ticket minus whatever Khalil could have received by selling it to another person in the parking lot.

C. whatever Khalil would have done had he not gone to the opera.

56. The U.S. has accumulated over $100 trillion worth of machinery, factories, and buildings and, therefore, the production processes tend to be ______ intensive. Multiple choice question. capital human capital labor land

CAPITAL Capital intensive - production processes that use a high ration of capital to labor inputs.

2. Suppose the following data describe output in two different years. Item Year 1 Year 2 Apples YEAR 1: 20,000 @.25 each YEAR 2: 30,000 @.30 each Bicycles YEAR 1: 700 @ $800 ea YEAR 2: 650 @ $900 ea Apps YEAR 1: 10,000 @ $1.00 ea 1 YEAR 2: 12,000 @ 2.00 ea Instructions: In parts a and c, enter your responses as a whole number. In parts b and d, round your responses to one decimal place. a. Compute **nominal GDP** in each year. Year 1: $575000 Year 2: 618000 b. By what percentage did nominal GDP change between Year 1 and Year 2? **Percentage change - ((new value - original value) /original value) x 100** Nominal GDP increased by 7.5% c. Now compute **real GDP** in Year 2 by using the prices of Year 1. Real GDP $539500 d. By what percentage did real GDP change between Year 1 and Year 2? **Percentage change = ((new value - original value)/ original value) x 100** Real GDP decreased by 6.2%

Compute nominal GDP multiply Year 1 of each product then add sums a. Year 1 = 575000 Year 2 = 618000 b. By what percentage did nominal GDP change between Year 1 and Year 2? **Percentage change = ((new value - original value) / original value) X 100** 618000 - 575000 = 43000 / 575000 X 100 **Nominal GDP increased by 7.5%** c. Compute real GDP in Year 2 using prices of Year 1 7500 520000 12000 TOTAL $539,500 d. By what percentage did real GDP change between Year 1 and Year 2? **Percentage change = ((new value - original value) / original value) X 100** 539500 - 575000 / 575000 X 100 6.2% DECREASE

15. In Figure 2.2 for 2020, the largest percentage use of GDP is composed of what? Multiple choice question. Consumption Government Investment Net exports

Consumption 71%

34. Which of the following is an example of a normative statement? A. The rate of unemployment is 4%. B. A high rate of economic growth creates more jobs for the country. C. The federal government spends half of its budget on national defense. D. Everyone in America deserves to be covered by national health insurance. E. High school graduation rates in the U.S. are lower than they are in some European nations.

D. Everyone in America deserves to be covered by national health insurance.

15. Which is not an example of a resource? A. Land B. Labor C. Capital D. Production E. Oil reserves

D. Production

22. The university recently inherited a large mansion from a wealthy alumnus. The university plans to use the mansion for faculty parties and to house distinguished guests. The cost of the mansion to the university is: A. zero, because it was a gift. B. the cost of upkeep (including maintenance, utilities, and so forth). C. the amount the university would receive if it rented or sold the mansion. D. the cost of upkeep (including maintenance, utilities, and so forth) and the amount the university would receive if it rented or sold the mansion. E. the cost of hosting the faculty parties and housing the distinguished guests.

D. the cost of upkeep (including maintenance, utilities, and so forth) and the amount the university would receive if it rented or sold the mansion.

20. Which of the following is not one of the four basic principles for understanding individual choice? A. Resources are scarce. B. The real cost of something is the money that you must pay to get it. C. "How much?" is a decision at the margin. D. People usually take advantage of opportunities to make themselves better off. E. Markets usually lead to efficiency

E. Markets usually lead to efficiency

37. A normative statement deals with: A. the facts. B. what was, is, or will be. C. prices unadjusted for inflation. D. the scientific method. E. what ought to be

E. what ought to be

17. Margo spends $10,000 on one year's college tuition. The opportunity cost of spending one year in college for Margo is: A. $10,000. B. whatever she would have purchased with the $10,000 instead. C. whatever she would have earned had she not been in college. D. whatever she would have purchased with the $10,000 minus whatever she would have earned had she not been in college. E. whatever she would have purchased with the $10,000 plus whatever she would have earned had she not been in college.

E. whatever she would have purchased with the $10,000 plus whatever she would have earned had she not been in college.

10. Assume that it takes four hours of labor time to paint a room and two hours to sand a floor. If two workers each spends 24 hours painting: a. How many rooms could be painted? 12 rooms b. If a decision were made to only sand floors, how many floors could be sanded? 24 floor(s) c. Illustrate with a production possibilities curve. The figure below shows the production possibilities for one worker. Instructions: Use the tools provided 'PPC2' to plot a second production possibiliites curve to illustrate the possible combinations of painting rooms and sanding floors when there are two workers (plot 13 points total, showing whole rooms and whole floors completed).

Explanation a. If two workers each spends 24 hours painting rooms and they can paint a room in four hours, then these workers can paint 12 rooms (=24 hours x 2 workers)/ 4 hours per room) b. If two workers each spends 24 hours sanding floors and they can sand a floor in two hours, then these workers can sand 24 floors (=24 hours x 2 workers)/ 2 hours per floor) c. The carious production possibilities are plotted with "Rooms Painted" on the vertical axis and "Floors Sanded" on the horizontal axis. Since there are two workers, the production possibilities have doubled. If both workers spend all of their time sanding floors. 24 floors can be sanded (2 floors sanded and 0 rooms painted). Some of the alternative production possibilities points in between those two extremes are (4 floors sanded and 10 rooms painted), (8 floors sanded and 8 rooms painted), (12 floors sanded and 6 rooms painted). (16 floors sanded and 4 rooms painted), and (20 floors sanded and 2 rooms painted).

8. Possible Output Combinations A 0/140 B 50/130 10 C 100/115 15 D 150/90 25 E 200/55 35 F 250/0 55

Explanation The opportunity cost of increasing the production of missiles is the loss of production of houses. For example, increasing missile production from 50 to 100 results in a loss of 15 houses (=130-115), increasing missile production from 100 to 150 results in a loss of 25 houses (=115-90), and so on.

9. Possible Output Combinations Assume that it takes four hours of labor time to paint a room and two hours to sand a floor. If 24 hours were spent painting: a. How many rooms could be painted? 6 rooms b. If a decision were made to sand two floors, how many painted rooms would have to be given up? 1 room c. Illustrate with a production possibilities curve. Use the tool provided 'PPC' to plot the production possibilities curve (plot 7 points total) showing whole rooms and whole floors completed.

Explanation a. If 24 hours were spent painting rooms and a worker can paint a room in 4 hours, then this worker can paint six rooms (=24 hours/4 hours per room) b. Because it takes two hours to sand a floor, it would take a worker four hours to sand two floors. Therefore, the worker must give up painting one room, which also takes four hours to complete. c. The various production possibilities are plotted with "Rooms Paiinted" on the vertical axis and "Floors Sanded" on the horizontal axis. Thus, if a worker spends all of his or her time sanding floors, 12 floors can be sanded (12 floors sanded and 0 rooms painted). The alternative production possibilities points in between those two extremes are (two floors sanded and 5 rooms painted), (4 floors sanded and 4 room painted), (six floors sanded and 3 rooms painted), (8 floors sanded and two rooms painted), and (10 floors sanded and 1 room painted).

54. True or false: The government has no role in an economy. True false question.TrueFalse

FALSE

55. Government failure occurs when government intervention improves economic outcomes. True false question.

FALSE

69. The idea that the U.S. economy uses the market mechanism to distribute most goods and services and those who receive the most income get the most goods is best represented by the question: Multiple choice question. WHY is output produced? FOR WHOM is output produced? WHAT goods and services are produced? HOW is output produced?

FOR WHOM is output produced?

49. Select all that apply Choose those characteristics that best describe central planning. Multiple select question. Government decides what goods are produced at what price. A central planning board makes all economic decisions concerning resources. The division of output between capital and consumer goods is decided by market forces. Firms produce according to the demands of consumers.

Government decides what goods are produced at what price. A central planning board makes all economic decisions concerning resources.

28. Select all that apply Which of the following are the four major uses of total output? (Select all that apply.) Multiple select question. Money Government services Household consumption Business investment Stocks and bonds Exports

Government services Household consumption Business investment Exports

39. The economic question of ' ______________to produce' is about decisions related to the mix of factor inputs (land, labor, and capital) used to produce goods and services. (Enter only one word in the blank.)

HOW

46. The economic question of '______ to produce' is about decisions related to the mix of factor inputs (land, labor, capital...) used to produce goods and services. Multiple choice question. when how for whom what

HOW

55. The economic question of '____________ to produce' is about decisions related to the mix of factor inputs (land, labor, and capital) used to produce goods and services. (Enter only one word in the blank.)

HOW

62. Select all that apply Which of the following are true about the curve shown in the figure? (Select all that apply) Multiple select question. It has a positive slope. It has a negative slope. It is a nonlinear curve. It is a linear curve.

It has a positive slope. It is a nonlinear curve.

72. Select all that apply Which of the following are true about the curve shown in the figure? (Select all that apply) Multiple select question. It is a linear curve. It is a nonlinear curve. It has a negative slope. It has a positive slope.

It is a nonlinear curve. It has a positive slope.

47. In a market driven economy, which process dominates the decision-making process? Multiple choice question. Central planning Market mechanism Political process Social welfare maximization

Market mechanism

3. In 2020, Mexico had a population of 128 million people, of whom 0.409 million were in the military. The United States had a military of 2.233 million out of a population of 330 million. What percentage of the population was in the military in: Instructions: Round your responses to two decimal places. a. Mexico? ________% 0.3% b. The United States? ________% 0.7%

Mexico - 0.3% 0.30% US - 0.7% 0.70% a. In Mexico, 0.32 percent of the population was in the military. Percentage of population in the military = (military/population) x 100= (0.409 million/128 million) x 100=0.32% b. In the United States, 0.68 percent of the population was in the military. Percentage of population in the military = (military/population)x100=(2.233 million/330 million)x100=0.68%

21. Which of the following is not an example of a consumer good or service? Multiple choice question. Television sets Military airplanes Restaurant meals Clothing

Military airplanes

Select all that apply The role of government includes which of the following? Multiple select question. Providing a legal framework Requiring maximum levels of agricultural production Protecting the environment Monitoring daily production of manufacturers

Providing a legal framework Protecting the environment

58. Calculate the slope between points X and Y. Multiple choice question. 4 6 1/6 1/4 1/8 8

Slope= vertical distance between two points horizontal distance between two points Slope= the rise over the run **1/8**

59. Select all that apply Which of the following define ceteris paribus? (Check all that apply.) Multiple select question. The idea that factors other than those being considered in a particular analysis change That other things remain unchanged (equal) The idea that factors other than those being considered in a particular analysis do not change

That other things remain unchanged (equal) The idea that factors other than those being considered in a particular analysis do not change

30. Select all that apply Which of the following is an example of a consumer good? Multiple select question. An assembly line at Ford The textbook for this course A TV set A military jet

The textbook for this course A TV set

5. Select all that apply According to Figure 2.1, which countries had GDP greater than $4 trillion in the year shown? Multiple select question. Great Britain United States Germany Colombia China Japan old_figure_2.1_GDP(6681578e).jpg Text Alternative The data is as follows: United States, 19.39 (highlighted); China, 12.24; Japan, 4.87; Germany, 3.68; Britain, 2.62; India, 2.60; Russia, 1.58; Mexico, 1.15; Venezuela, 0.21; Greece, 0.20, and Haiti, 0.01.

United States China Japan

2. The economic question of ___________ ' to produce' is about decisions related to the mix (quantity and type) of goods and services to make available in a given economy.

WHAT

Ch. 2 The U.S. Economy 1. The three main decisions that must be addressed by an economic system do not include: Multiple choice question. FOR WHOM output is produced HOW output is produced WHY output is produced WHAT goods and services to produce

WHY output is produced

6. Select all that apply Which of the following are the three critical questions that an economic system must address? Multiple select question. What to produce? How to produce? For whom to produce? When to produce?

What to produce? How to produce? For whom to produce?

66 of 75

Your most challenging concepts Explain the answer to "How to produce." Recall that economic growth can alleviate poverty. Identify the major uses of total output.

54. Select all that apply Land, labor, capital, and entrepreneurship are all scarce economic resources privately or collectively owned by members of society. When these scarce resources are used to produce goods or services, there is ______. Multiple select question. a cost borne by society in utilizing these resources to produce any good or service no opportunity cost no cost borne by society in utilizing these resources to produce goods or services no "free lunch"

a cost borne by society in utilizing these resources to produce any good or service no "free lunch"

31. An import is Multiple choice question. consumer spending spending on government output a good or service sold to foreign sources a good or service purchased from foreign sources

a good or service purchased from foreign sources

47. An import is Multiple choice question. a good or service sold to foreign sources spending on government output a good or service purchased from foreign sources consumer spending

a good or service purchased from foreign sources

29. An export is Multiple choice question. consumer spending spending on government output a good or service sold to foreign buyers a good or service purchased from foreign sources

a good or service sold to foreign buyers

6. Which of the following is associated with microeconomics? * a specific U.S. industry's sales figures** * the country's unemployment rate * an economy's overall output level * the economy's rate of growth

a specific U.S. industry's sales figures One focus of microeconomics is on individual firms

progressive tax

a tax system in which tax rates rise as incomes rise.

4. According to the figure showing 2020 GDP for selected countries, how much larger (in percentage terms) is America's GDP than: a. Japan? 322% larger b. Greece? 10105% larger

a. US - 21.43 Japan - 5.08 21.43 - 5.08= 16.35 / 5.08 X100 = 321.850 or 322% b. Greece? 0.21 21.43 - 0.21 /0.21 X 100 = 10104.7619 = 10105% larger explanation: Computation in percentage terms on how large is America's GDP than Great Britain: = (GDP of America - GDP of Great Britain) / GDP of Great Britain * 100 = ($21.43 trillion - $2.83 trillion) / $2.83 trillion * 100 = $18.60 trillion / $2.83 trillion * 100 = 6.57244 * 100 = 657.244% = 657% Thus America's GDP is 657% larger than Great Britain Computation in percentage terms on how large is America's GDP than Haiti: = (GDP of America - GDP of Haiti) / GDP of Haiti * 100 = ($21.43 trillion - $0.01 trillion) / $0.01 trillion * 100 = $21.42 trillion / $0.01 trillion * 100 = 2142 * 100 = 214200% Thus America's GDP is 214200% larger than Haiti

6. Use the table to answer the following questions: If a McDonald's Happy Meal costs $5, how many Happy Meals per week could: Instructions: Round your responses to the nearest whole number. a. the average person in Burundi afford? 3 Happy Meals per week b. the average person in Nigeria afford?

a. $1,728 / 52 / $5 = 3 b. $5066 / 52 / $5 = 20

5. Use the table to answer the following questions Country Per Capita income ( in 2020) If a McDonald's Happy Meal costs $5 how many Happy Meals per week could: Instructions: Round your responses to the nearest whole number a. the average person in America afford? 243 b. the average person in Haiti afford? 7

a. United States (2020) per capita income is $63,051 / 52 weeks/ $5.00 = 243 b. $1,728 / 52 weeks / %5.00 = 7 (6.64)

11. Which of the following is the best example of a fixed cost? a. a monthly car payment b. a credit card payment c. a payment on an adjustable rate mortgage d. the price of a new DVD

a. a monthly car payment

21. Who wrote the book Wealth of Nations, which provides the basic philosophy for the capitalist system? a. Karl Marx b. Milton Friedman c. Adam Smith d. John Keynes

c. Adam Smith

9. News Wire Global Inequalities Income Share of the Rich Using the figure, what is the average per capita income in nations shown in the figure where the highest- income decile gets: Instructions: Enter your responses as a whole number a. at least half of total income? b. less than 30 percent of total income?

a. $12,920 look at countries with percentage of total income received over 50% Namibia $10,380, South Africa 12,870, Botswana 15,510/ 3 10380+12870+15510 = 38760 / 3 = $12,920 b. $41,590 41680 + 34700 + 41280 + 48700 / 4 = $41,590 The average per capita income in nations where the highest-income decile gets: (a) at least half of total income = (Per capita income of countries whose percentage of total income received by highest decile is equal to or greater than 50%) / The total number of countries receiving greater than equal to 50% = $(10,380 + 12,870 + 15,510) / 3 = $38,760 / 3 Average per capita income = $12,920 Half of total income means those countries whose percentage of total income received by highest decile is equal to or greater than 50%. From the diagram, the countries whose percentage of total income received by highest decile is equal to or greater than 50% are Namibia, South Africa and Botswana. (b) less than 30% of total income = (Per capita income of countries whose percentage of total income received by highest decile is less than 30%) / The total number of countries receiving less than 30% = $(41,680 + 34,700 + 41,280 + 48,700) / 4 = $166,360 / 4 Average per capita income = $41,590 Less than 30% of total income means those countries whose percentage of total income received by highest decile is less than 30%. From the diagram, the countries whose percentage of total income received by highest decile is less than 30% are France, Spain, Great Britain and Sweden.

7. Assume that total output is determined by this formula: number of workers X productivity = total output Hint: Assume there are 100 workers and each worker produces $100 of output Instructions: Round your responses to one decimal place a. If the workforce is growing by 1 percent a year but productivity doesn't improve, how fast can output increase? b. If productivity increases by 1 percent AND the number of workers increases by 1 percent a year, how fast will output grow?

a. 1% b. 2% If the workforce will grow by 3 % i.e. 100+ 100*3% = 103 Productivity remaining constant, Total output will be 103*100 = $10,300 Change in total output = 10,000-10,300 = 300 (i.e. 3% of total output) So the total output can increase by 3% also. If productivity increases by 1% i.e. 100+100*1% = 101 Similarly the workforce increases by 3% a year i.e. 100=100*3% = 103 Then the total output will be 103*101 = $10,403 Change in total output = 10,000-10403 = 403 ( i.e. 4% of total output)

10. In 2020, the United States devoted about 0.18 percent of its $21 trillion GDP to development assistance. Instructions: In part a, round your response to the nearest whole number. In part b, round your response to two decimal places. a. How much money is that? b. How much aid does that imply for each of the 3 billion poor people in developing nations?

a. 38 billion b. $12.67 per person a) 0.19% of 20 trillion = 0.0019 * 20000 billion = 38 billion b) aid per person = 38 b / 3 b = 12.67 billion

8. Use the table related to the size distribution of household income to answer the following questions, According to the table: Instructions: In part a, enter your response as a whole number. In part b, round your response to one decimal place. a. What is the average household income in the United States? b. What percentage of the average household income in the highest fifth would have to be taxed away to bring them down to that average?

a. 98,080 add all average incomes and divide by number of incomes The average household income in the United States can be calculated by adding up the average incomes of each income group and dividing by the number of groups. That is: 254,400+68,900+40,700+15,3005=75,860 Explanation: So the average household income in the United States is $75,860. b. 61.5% 254400 - 98080 = 156320 / 254400 = 0.614 X 100 = 61.5% 254,400 (average of highest fifth) - 98080 (avg of all incomes) b. The percentage of the average household income of people in the highest fifth that would have to be taxed away to bring them down to the average can be calculated by finding the difference between their average income and the overall average income, and dividing by their average income. That is: 254,400−75,860254,400=0.7018 Explanation: So the percentage is 70.2%

3. GDP per capita in the United States was approximately $63,000 in 2020. Use the growth formula (see below) to answer the following questions. Instructions: Round your responses to the nearest whole number. a. What will the GDP per capita be in the year 2025 if it grows each year by 0 percent? GDP per capita in 2025: $ 63000 b. What will GDP per capita be in the year 2025 if it grows each year by 2 percent? GDP per capita in 2025: $69552 **Growth formula: (future value) - (present value) x (1 + r) t** **present value = this year's GDP per capita future value = GDP per capita in the future r = rate of growth (in decimal form) per year t = number of years of growth

a. GDP per capita in the year 2025, if it grows each year by 0 percent will be $63,000 Present value of GDP (PV) = $63,000 Rate of growth per year (r) = 0% Number of years of growth (t) = 5 Future value (FV) = 63,000 X (1 + 0%) 5th power, or Future value (FV) = 63,000 X 1, or Future value (FV) = $63,000 b. What GDP per capita be in the year 2025 if it grows each year by 2 percent? 69552 Present value of GDP (PV) = $63,000 Rate of growth per year (r) = 2% Number of years of growth (t) = 5 Future value (FV) = 63,000 X (1 + 2%) 5th power Future value (FV) = 63,000 X (1.02) 5th power Future value (FV) = $63,000 X 1.10408 Future value (FV) = $69,557 (approx) The Future value (FV) = $63,000 X (

7. Use the information listed in the table to calculate the opportunity cost of increasing missile production and then graph the production possibilities curve. a. Calculate the opportunity cost of increasing missile production (in increments of 50 missiles) based on the following information: Instructions: Enter your responses as a whole number b. Using the information presented in the table above, graph the production possibilities curve with missiles on the horizontal axis and houses on the vertical axis. instructions: Use the tool provided 'PPC' to plot the production possibiliites curve (plot 6 points total). Transcribed Image Text:a. Calculate the opportunity cost based on the following information: Instructions: Enter your responses as a whole number. Possible Output Combinations Output per month A B D F Missiles 50 100 150 200 250 Houses 100 90 75 55 30 The opportunity cost of increasing missile production by 50 is: (such as 0 to 50, 50 to 100, 100 to 150, etc.) 2,500 houses b. Using the information presented in the table above, graph the production possibilitiles with missiles on the horizontal axis and houses on the vertical axis. Instructions: Use the tool provided 'PPC' to plot the production possibilities curve (plot 6 points total). Production Possibilities Curve PPC 120 110 - 100 - 80- 70- 00- 50 - 40- 30 - 20- 10 - 50 100 150 200 250 300 Missiles (per month) reset Houses (per month)

a. Opportunity cost of increasing missile production (in houses). A B 10 C - 15 D - 20 E - 25 F - 30 b. graph PPC Explanation: a. The opportunity cost of increasing the production of missiles is the loss of production of houses. For example, increasing missile production from 50 to 100 results in a loss of 15 houses (=90-75), increasing missile production from 100 to 150 results in a loss of 20 houses (=75-55), and so on. b. A production possibilities curve describes the various combinations of final goods and services that could be produced in a given time period with available resources and technology. Point A, for example, is an output combination of 0 missiles and 100 houses plotted on the vertical axis (0,100). Point F, on the other hand, is an output combination of 250 missiles and 0 houses plotted on the horizontal axis (250,0).

6. Of the following scenarios, which is an example of immediate gratification? a. an individual spends $100 on a pair of shoes instead of putting that money into his saving account b. an individual puts money into his savings account to use to buy a car when he turns 16 c. an individual pays for a gym membership instead of going to the movies d. an individual signs up for a credit card in order to begin building credit

a. an individual spends $100 on a pair of shoes instead of putting that money into his saving account

13. Which of the following is a market economy primarily based on? a. capitalism and free enterprise b. traditionalism and command c. incentives and traditionalism d. informed judgment

a. capitalism and free enterprise

6. Use the figure showing the military share of total U.S. output to answer the questions. What is the opportunity cost of military production? Instructions Round your responses to one decimal place. What percentage of total U.S. output consisted of military goals. a. In 1944? approximately _____% 39.5 b. in 2020? approximately ______% 3.5

a. in 2944? 39.5% b. in 2020? 3.5% Explanation: According to the graph, the percentage of total U.S. output consisting of military goods was approximately 39 percent in 1944 and 3.4 percent in 2020.

19. Capitalism thrives on competition. What is the main benefit of competition? a. lower prices b. better decision making c. a successful democracy d. marginal costs and benefits

a. lower prices

4. What term do economists use to describe the alternative you face if you decide to do one thing instead of another? a. trade-off b. marginal cost c. marginal benefit d. measure of cost

a. trade-off

4. The problem of scarcity is confronted by: A. industrialized societies. B. pre-industrialized societies. C. societies governed by communist philosophies. D. all societies. E. rural, but not urban, societies.

all societies.

Which of the following is not an example of a consumer good or service? Multiple choice question. the textbook for this course a watch massage therapy an assembly line at Ford

an assembly line at Ford

2. Economic growth is represented by * a point inside the production-possibilities curve * **an outward shift of the production-possibiilities curve * a movement along the production-possibilities curve * an inward shift of the production-possibilities curve

an outward shift of the production-possibilities curve Production-possibilities increase and shift outward with growth in resources and technology

19. Select all that apply Investment consists of: Multiple select question. any increase in inventories. resale of existing housing. spending on clothes and food. spending on new plant and equipment.

any increase in inventories. spending on new plant and equipment.

8. Proprietorships * dominate market transactions * are the most common type of business firm** * are known for their large assets * are owned by many individual stockholders

are the most common type of business firm The single proprietorship is the most common type of business firm in America

5. Policy Perspectives: Suppose the following data reflect the production-possibilities for providing health care and education. a. Graph the production-possibilities curve Instructions: Use the tool provided 'PPC' to plot the production-possibilities curve (plot 7 points total). Instructions: Enter your responses as a whole number. b. If maximum health care is provided, how much education will be provided? ______ units of education 0 c. What is the opportunity cost of increasing health care from 190 to 270 units? _________ units of education 10

b. 0 units of education c. 10 units of education Explanation: a. A production-possibilities curve describes the various combinations of final goods or services that could be produced in a given time period with available resources and technology. For example, one combination of output is 400 units of health care and 0 units of education, a second combination of output is 370 units of health care and 20 units of education, and so on. b. If all resources are used to produce health care, there will be no resources available to produce education. c. Increasing health care from 190 units to 270 units results in an opportunity cost of 10 units of education (=60 units of education-50 units of education).

14. Which term would economists use to describe a low initial interest rate on a credit card? a. obligation b. incentive c. voluntary exchange d. marginal benefit

b. incentive

18. Which of the following best defines Gross Domestic Product (GDP)? a. the total value of any goods and services produced in a single year b. the total value of all final goods and services produced in a single year c. the total value of all capital good and services produced in a single year d. the total value of all labor produced in a single year

b. the total value of all final goods and services produced in a single year

10. A car manufacturer can produce 5 cars for $10,000 each. After 5 cars are produced, the price to produce each additional car decreases to $7,500. Which term describes the type of cost for producing cars? a. total cost b. variable cost c. fixed cost d. marginal cost

b. variable cost

2. According to economic theory, when does scarcity occur? a. when a society has more resources than it needs to produce goods and services b. when there are not enough resources to produce all of the things a society would like to have c. when inflation occurs and demand for goods and services decreases d. when inflation occurs and demand for goods and services increases

b. when there are not enough resources to produce all of the things a society would like to have

8. Suppose the graph above shows the marginal benefits and costs for a farmer trying to decide how much of her 25 acres to plant with lettuce. At what point should the farmer stop farming more acres? a. At 5 acres b. At 15 acres c. At 20 acres d. At 25 acres

c. At 20 acres

15. Which of the following best defines informed judgment? a. choosing the next best alternative when choosing to do one thing rather than another b. the attitudes that most people hold about the relationship between the government and the economy c. choosing an alternative that has the greatest value from among comparable products d. choosing to limit the amount of goods produced in order to increase prices

c. choosing an alternative that has the greatest value from among comparable products

1. Which term is used to describe the study of how people make decisions in a world where resources are limited? a. scarcity b. decision-making modeling c. economics d. cost-benefit analysis

c. economics

9. An MP3 player manufacturer pays the same amount to produce each MP3 player no matter how many it produces in total. Which term describes the type of cost for producing MP3 players? a. total cost b. variable cost c. fixed cost d. marginal cost

c. fixed cost

16. What are the factors of production? a. natural resources, labor, capital, and money b. natural resources, capital, goods, and services c. natural resources, labor, capital, and entrepreneurs d. natural resources, money, labor, and entrepreneurs

c. natural resources, labor, capital, and entrepreneurs

22. Which term describes the money left over after all costs of production have been paid? a. revenue b. marginal expense c. profit d. loss

c. profit d. loss

3. When deciding between renovating a water treatment plant or building a new community pool, what is the government most likely to consider? a. scarcity vs. resources b. wages vs. prices c. wants vs. needs d. consumers vs. producers

c. wants vs. needs

45. Factories, storage, transportation and distribution facilities, and tools and machinery are all examples of the available stock of ______. Multiple choice question. capital human capital labor land

capital

53. Factories, storage, transportation and distribution facilities, and tools and machinery are all examples of ___________ stock.

capital

48. Production processes that use a high ratio of capital to labor inputs are: Multiple choice question. capital intensive factor mobile intensive human capital intensive labor intensive

capital intensive

65. Production processes that use a high ratio of capital to labor inputs are: Multiple choice question. capital intensive factor mobile intensive labor intensive human capital intensive

capital intensive

50. The assumption that nothing else changes is known as Multiple choice question. ceteris paribus scarcity opportunity cost the market mechanism

ceteris paribus

52. Match the type of firm to its ownership characteristics: Instructions Corporation Partnership Proprietorship a firm owned by a small number of individuals a firm owned by one individual a firm owned by many individuals, each of whom owns shares (stock)

corporation - a firm owned by many individuals, each of whom owns shares (stock) partnership - a firm owned by a small number of individuals proprietorship - a firm owned by one individual Corporation a firm owned by many individuals, each of whom owns shares (stock) Partnership a firm owned by a small number of individuals Proprietorship a firm owned by one individual

externalities

costs (or benefits) of a market activity borne by a third party; the difference between the social and private costs (or benefits) of a market activity.

17. Which of the following is an example of a capital good? a. a box of cereal b. a pair of shoes c. a television d. a hammer

d. a hammer

5. Which of the following best describes an opportunity cost? a. the additional cost of producing one additional unit of output b. an individual goes to the movies and decides to buy popcorn c. the real price of items increases as the value of money decreases d. an individual pays for a guitar lesson instead of going to the movies

d. an individual pays for a guitar lesson instead of going to the movies

Use the following graph to answer questions 7-8 Marginal Benefits/Marginal Costs 5 10 15 20 25 Acres 7. Which of the following is represented by the graph? a. supply-demand analysis b. utility curve c. opportunity cost analysis d. cost-benefit analysis

d. cost-benefit analysis

12. Which of the following terms refers to the extra or additional cost of producing one additional unit of output? a. total cost b. variable cost c. fixed cost d. marginal cost

d. marginal cost

20. What are the major characteristics of capitalism? a. competition, profit, and government ownership of resources b. government set prices and private property c. competition, profit, and production based on custom and tradition d. markets, private property, competition, and profits

d. markets, private property, competition, and profits

27. Select all that apply Government income transfers include all of the following: Multiple select question. direct payments to veterans payments to the elderly from Social Security wage payments to police officers direct welfare payments to low-income households

direct payments to veterans payments to the elderly from Social Security direct welfare payments to low-income households

41. Net exports include goods produced: Multiple choice question. domestically that are sold abroad minus goods produced domestically that are sold domestically domestically that are sold abroad minus goods that are produced abroad that are sold domestically domestically that are sold domestically minus goods produced domestically that are sold abroad abroad that are sold domestically minus goods that are produced domestically that are sold abroad

domestically that are sold abroad minus goods that are produced abroad that are sold domestically The GDP accounts subtract imports from exports - the difference represents net exports. When imports exceed exports, we are using more goods and services than we are producing. Hence, we have to subtract net imports from consumption, investment, and government services to figure out how much we actually produced. That is why net exports appear as a negative item in Figure 2.2.

17. The primary category(s) of consumer purchases include ______. Multiple choice question. only durable goods only nondurable goods durable goods, nondurable goods, and services both nondurable goods and services

durable goods, nondurable goods, and services

18. An increase in output or an expansion of production possibilities is called: Multiple choice question. per capita GDP gross domestic product economic growth productivity

economic growth

11. Ceteris paribus, economic growth involves an * increase in GDP due to inflation * expansion of production possibilities** * increase in imports * increase in government spending

expansion of production possibilities Economic growth will expand production possibilities outward

investment

expenditures on (production of) new plant and equipment (capital) in a given time, plus changes in business inventories.

35. Because we import more than we export, net ______ are a ______ component of GDP. Multiple choice question. exports, positive exports, negative imports, negative imports, positive

exports, negative

19. The central problem of economics is the * distribution of goods and services to those in need * labor unemployment visiible throughout the economy * fact that human wants exceed the availability of resources** * inefficiency of government operations19

fact that human wants exceed the availability of resources There is only a finite amount of resources, so there are not enough to meet all human desires

Land, labor, capital, and entrepreneurship are known as ___________of production.

factors

51. Land, labor, capital, and entrepreneurship are known as _____________ of production.

factors Factors of production - resource inputs used to produce goods and services (e.g. land, labor, capital,a nd entrepreneurship).

43. Select all that apply The basic factors of production, or resources, include: Multiple select question. land (natural resources) currency and coins capital stocks and bonds entrepreneurship labor

factors of production - resource inputs used to produce goods and services (e.g. land, labor, capital, and entrepreneurship). land (natural resources) capital entrepreneurship labor

7. The decline in employment in the farm sector in the United States during the 1900s can be attributed primarily to * an increase in the importance of the manufacturing sector * a decline in the amount of food consumption per person * competition from imported agricultural products * new technology that made it possible to grow more food with fewer workers**

new technology that made it possible to grow more food with fewer workers New technology makes it possible to grow more food with fewer workers

4. Computing GDP using current prices allows us to calculate______. Multiple choice question. current GDP nominal GDP real GDP net GDP

nominal GDP

24. Select all that apply What are the three major categories of consumer purchases? Multiple select question. investment goods nondurable consumer goods durable consumer goods services inventory goods

nondurable consumer goods durable consumer goods services

3. Scarcity in economics means: A. the needs of people are limited. B. the wants of people are limited. C. there must be poor people in rich countries. D. shortages exist in nearly all markets. E. not having sufficient resources to produce all the goods and services we want at zero cost.

not having sufficient resources to produce all the goods and services we want at zero cost.

quintile

one-fifth(e.g. of total population)

15. Nominal GDP is affected by changes in??? * output and prices** * prices only * income transfers * output only

output and prices Nominal GDP measures the value of output produced in current prices

productivity

output per unit of input (e.g. output per labor-hour).

59. Proprietorships, partnerships and corporations are business firms where the primary distinction between the three lies in their ______ characteristics. Multiple choice question. profit ownership costs revenue

ownership

income transfers

payments to individuals for which no current goods or services are exchanged (e.g. Social Security, welfare, unemployment benefits)

7. The dollar value of GDP divided by the total population is called: Multiple choice question. GDP economic growth productivity per capita GDP

per capita GDP

68. Select all that apply With economic growth: Multiple select question. interest rates will fall poverty can be decreased trade will be decreased people can consume more goods

poverty can be decreased people can consume more goods

74. Select all that apply With economic growth: Multiple select question. poverty can be decreased people can consume more goods trade will be decreased interest rates will fall

poverty can be decreased people can consume more goods

38. The essential feature of the market mechanism is the _________ signal. (Enter one word in the blank.)

price

capital intensive

production proceses that use a high ratio of capital to labor inputs.

50. The U.S. has greater ______, or output per worker, compared to poorer countries. This is a reflection of the U.S. quality and quantity of both capital and labor. Multiple choice question. real GDP investment productivity human capital physical capital

productivity

57. The U.S. has greater _________, or output per worker, compared to poorer countries. This is a reflection of the U.S. quality and quantity of both capital and labor.

productivity

61. The government's primary roles in an economy includes which of the following? Multiple choice question. protecting monopolies protecting capitalists protecting consumers protecting corporations

protecting consumers

Select all that apply All of the following are basic functions of the government: Multiple select question. protecting the environment* protecting consumers* providing a legal framework* protecting labor* establishing monopolies

protecting the environment protecting consumers providing a legal framework protecting labor

Real GDP divided by the size of the population is called: Multiple choice question. nominal GDP per capita nominal economic growth real personal GDP real GDP per capita

real GDP per capita

9. Economic growth is best measured as an increase in: Multiple choice question. nominal GDP real output investment household consumption

real output

A nation's gross domestic product (GDP): Multiple choice question. reflects the aggregate output of intermediate goods produced within an economy in a given time period reflects the total market value of all final goods and services produced within an economy in a given time period reflects the total market value of all goods and services, final and intermediate, produced by a country's resources in a given time period reflects the aggregate output of final and intermediate goods produced within an economy in a given time period

reflects the total market value of all final goods and services produced within an economy in a given time period Reason: The measure of GDP defines aggregate output as the dollar value of all final goods and does not include intermediate goods.

factors of production

resource inputs used to produce goods and services (e.g. land, labor, capital, and entrepreneurship).

12. We have to make choices because: A. we have unlimited income. B. resources are scarce. C. choices involve a trade-off. D. resources are scarce and because choices involve a trade-off. E. marginal benefits never exceed marginal costs.

resources are scarce and because choices involve a trade-off.

11. Corner offices in high-rise office buildings usually cost more to rent than other offices. This fact best illustrates the economic principle of: A. marginal analysis. B. scarce resources. C. resources should be used as efficiently as possible to achieve society's goals. D. opportunity costs. E. one person's spending is another person's income

scarce resources.

3. If society lacks enough resources to satisfy all the desired uses of the resources, this is known as * market failure * scarcity** * government failure * laissez-faire

scarcity all factors of production are finite in quantity

6. When we are forced to make choices we are facing the concept of: A. ceteris paribus. B. free goods. C. scarcity. D. the margin. E. positive and normative analysis.

scarcity.

60. When a curve _____, the underlying relationship between two variables has changed. Multiple choice question. is nonlinear decreases shifts increases

shifts

73. Select all that apply With economic growth: Multiple select question. society can enjoy lower interest rates society can purchase goods at a lower price societal welfare can increase society can consume more goods per person

societal welfare can increase society can consume more goods per person Reason: Prices are determined by the interaction of supply and demand. Lower prices can result from productivity gains, but will still be subject to supply and demand forces.

75. Select all that apply With economic growth: Multiple select question. society can consume more goods per person society can purchase goods at a lower price societal welfare can increase society can enjoy lower interest rates

society can consume more goods per person societal welfare can increase

69. A graph will Blank______ show a cause-and-effect relationship. Multiple choice question. sometimes never always not

sometimes

75. A graph will _____ show a cause-and-effect relationship. Multiple choice question. always never not sometimes

sometimes

13. In order to measure what a country produces, we * summarize total output in physical terms * summarize the monetary value of output** * count the weight of different products * count units of output

summarize the monetary value of output Using monetary value instead of physical units to compare total output, the accounting is easier

66. One tool that the government uses in order to redistribute income is Multiple choice question. taxation. exports. pricing. importation.

taxation

Select all that apply Which of the following are tools by which the government redistributes income in the society? Multiple select question. providing a legal framework taxes protection of property rights income transfers

taxes income transfers

7. Whenever a choice is made: A. the cost of that choice could be referred to as opportunity cost. B. the cost is easy to measure in dollar terms. C. efficiency is always improved. D. scarcity is not the problem. E. marginal costs are greater than marginal benefits of that choice.

the cost of that choice could be referred to as opportunity cost.

37. The most dramatic change in the industry structure in the U.S. over the last 100 years has been: Multiple choice question. the increase in the relative size of the manufacturing sector the decline in the relative size of the farm sector the relative increase in construction and mining the decline in the relative size of the service sector

the decline in the relative size of the farm sector

real GDP

the inflation-adjusted value of GDP; the value of output measured in constant prices.

human capital

the knowledge and skills possessed by the workforce.

60. In a market economy like the U.S. the FOR WHOM to produce question is primarily answered by: Multiple choice question. the productivity of the capital stock government directives international trade the market mechanism

the market mechanism

8. The economic question of 'WHAT to produce' is about decisions related to: Multiple choice question. the mix (quantity and type) of goods and services to produce the location of the production process the use of prices to sell goods and services the distribution of goods and services in the economy

the mix (quantity and type) of goods and services to produce

64. Income mobility refers to: Multiple choice question. the movement over time of households from one job location to another. the movement over time of households from one income level to another. the movement over time of nations from one income level to another. the movement over time of households from one income source to another.

the movement over time of households from one income level to another.

17. American production is described as capital intensive, which means that * foreign investment is relatively small * the ratio of labor to machinery is high * the ratio of machinery to labor is high** * government control of productoin processes is high

the ratio of machinery to labor is high In the production of goods, more capital goods are used than labor

opportunity cost

the sacrifice of a next-best alternative The most desired goods and services that are forgone in order to obtain something else.

9. How people choose among the alternatives available to them is: A. not part of the study of economics. B. impossible to describe. C. the study of microeconomics. D. not important. E. normative economics

the study of microeconomics.

per capita GDP

total GDP divided by total population; average GDP

35. On which of the following does the designation of any particular mix of output for a particular society as "best" rest on? Multiple choice question. investments value judgments technology resources

value judgments

16. Opportunity cost may be defined as the * dollar price paid for a final good or service * value of the most desired goods or services that are foregone to obtain something else** * dollar cost of producing a particular product * dollar cost of the next best alternative resources for producing a good

value of the most desired goods or services that are forgone to obtain something else The opportunity cost is the value of the next best alternative that is given up when we make a choice

23. The economic question of ' (one word) to produce' is about decisions related to the mix (quantity and type) of goods and services to make available in a given economy.

what

31. The economic question of 'Blank______ to produce' is about decisions related to the mix (quantity and type) of goods and services to make available in a given economy. Multiple choice question. where what how for whom

what

5. The economic question of '_______________- (one word) to produce' is about decisions related to the mix (quantity and type) of goods and services to make available in a given economy.

what

5. The opportunity cost of something is: A. greater during periods of rising prices. B. equal to the money cost. C. less during periods of falling prices. D. what is given up to acquire it. E. equal to zero for something that is given to you as a gift

what is given up to acquire it

9. Select all that apply Select all choices from the following that would be synonymous with land to an economist. Multiple select question. Arable land Forests Water Oil and mineral deposits Factories

**Arable land** Reason: Land includes all natural resources or "gifts of nature" used in the production process. **Forests** Reason: Land includes all natural resources or "gifts of nature" used in the production process. **Water** Reason: Land includes all natural resources or "gifts of nature" used in the production process. **Oil and mineral deposits** Reason: Land includes all natural resources or "gifts of nature" used in the production process.

22. Between the years of 1940 and 2019, military expenditures as a percentage of total U.S. output have ranged between Blank______ (at their largest) to Blank______ (at their smallest). Multiple choice question. 40%, 3% 30%, 0% 15%, 5% 40%, 15% The horizontal axis represents years ranging from 1940 through 2020 in increments of 5. The vertical axis ranges from 0 through 40 in increments of 2. The data (in percentage) is as follows: The curve begins from 1940 at 2 and ends in 2020 at 1.8, passing through39.8 in 1945 (around World War 2), 15 after 1950 (around Korean War), 9.9 after 1965 (around Vietnam War), 6 at 1980 (around Russian buildup), 5.3 after 1990 (around End of Cold War), and 3.4 after 2000). The label at the top right reads: "What is the opportunity cost of military production?" Note: All data is approximate.

40%, 3%

39. Between the years of 1940 and 2019, military expenditures as a percentage of total U.S. output have ranged between Blank______ (at their largest) to Blank______ (at their smallest). Multiple choice question. 40%, 15% 30%, 0% 15%, 5% 40%, 3% old_Military as a percentage of output(6681493e).jpg Text Alternative The horizontal axis represents years ranging from 1940 through 2020 in increments of 5. The vertical axis ranges from 0 through 40 in increments of 2. The data (in percentage) is as follows: The curve begins from 1940 at 2 and ends in 2020 at 1.8, passing through39.8 in 1945 (around World War 2), 15 after 1950 (around Korean War), 9.9 after 1965 (around Vietnam War), 6 at 1980 (around Russian buildup), 5.3 after 1990 (around End of Cold War), and 3.4 after 2000). The label at the top right reads: "What is the opportunity cost of military production?" Note: All data is approximate.

40%, 3%

Application-Based Activity Orientation Video 1. Where do you find instructions, learning objectives, evaluation and scoring for this ABA assignment? 2.

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30. From 1980 to 2019, the share of the total U.S. output devoted to national defense has ranged from ______ (at its largest) to ______ (at its smallest). Multiple choice question. 7%, 3% 15%, 3% 30%, 0% 40%, 2% old_Military as a percentage of output(6681493e).jpg Text Alternative The horizontal axis represents years ranging from 1940 through 2020 in increments of 5. The vertical axis ranges from 0 through 40 in increments of 2. The data (in percentage) is as follows: The curve begins from 1940 at 2 and ends in 2020 at 1.8, passing through39.8 in 1945 (around World War 2), 15 after 1950 (around Korean War), 9.9 after 1965 (around Vietnam War), 6 at 1980 (around Russian buildup), 5.3 after 1990 (around End of Cold War), and 3.4 after 2000). The label at the top right reads: "What is the opportunity cost of military production?" Note: All data is approximate.

7%, 3%

market failure

A situation in which the market mechanism generates suboptimal economic outcomes; an imperfection in the market mechanism that prevents optimal outcomes.

mixed economy

An economy that uses both market and nonmarket signals to allocate goods and resources

economic growth

An increase in output (real GDP); an expansion of production possibilities.

investment

Expenditures on (production of) new plant and equipment (capital) in a given time period, plus changes in business inventories.

3. It is optional to indicate how confident you are in your answer (High, Medium, Low) before you submit your answer (s)

FALSE

6. To advance the progress completion percentage in a SmartBook assignment, only one question per concept must be answered correctly.

FALSE

7. SmartBook recharge mode can be accessed at any time during a SmartBook assignment attempt.

FALSE

government failure

Government intervention that fails to improve economic outcomes.

40. Select all that apply Which of the following describe central planning? Multiple select question. Firms and households acting in their own self-interest Government ownership of most or all property resources A government-appointed central planning board Firms producing what consumers demand

Government ownership of most or all property resources A government-appointed central planning board

36. ______ makes decisions such as increasing the share of military spending, how many interstate highways to build, and how many Head Start classes to offer. Multiple choice question. The political process Central planning The market mechanism

The political process

macroeconomics

The study of aggregate economic behavior, of the economy as a whole.

11. __________________ (one word) consists of the physical actions and mental activities that people contribute to the production of goods and services.

Labor

19. Which of the following consists of the physical and mental activities that people contribute to the production of goods and services? Multiple choice question. Labor Employment Investment Capital

Labor

scarcity

Lack of enough resources to satisfy all desired uses of those resources.

17. Multiple Choice Question Which of the following includes all natural resources used in the production of goods and services? Multiple choice question. Capital Land Entrepreneurship Labor

Land

1. Where do you find instructions, learning objectives, evaluation and scoring for this ABA assignment? Under the help button in the top right corner The avatars explain what's expected and how I am scored On the opening welcome message and the Score tab The Activity Completion screen

On the opening welcome message and the Score tab Explanation This information is available to you at the start of the assignments before selecting your avatar. You can also revisit it at any time by clicking on the "Score" tab.

microeconomics

The study of individual behavior in the economy, of the components of the larger economy.

market mechanism

The use of market prices and sales to signal desired outputs (or resource allocations).

factors of production

Resource inputs used to produce goods and services (e.g., land, labor, capital, and entrepreneurship).

1. SmartBook 2.0 allows you to start your active learning experience by either reading or jumping right in to start answering questions.

TRUE

2. In the United States, the COVID-19 pandemic lead to fears of widespread economic collapse. T/F

TRUE

2. The most important topics in the text are initially highlighted for you. You can navigate through the highlights by clicking the 'Concepts' (forward and back) arrows.

TRUE

4. After getting some questions wrong, you must click on a resource such as "Learn About This" to learn more about the concept before moving forward.

TRUE

5. The progress bar indicates how many concepts you have completed, how many are in progress, and how many are still left in the assignment.

TRUE

production possibilities

The alternative combinations of goods and services that could be produced in a given time period with all available resources and technology.

laissez faire

The doctrine of "leave it alone," of nonintervention by government in the market mechanism.

7. What does each point on a production possibilities curve represent? Multiple choice question. An attainable combination of goods that can be produced given unlimited resources The minimum combination of goods that can be produced given available resources The maximum combination of goods that can be produced given available resources The most desirable combinations of goods and services produced with the given resources

The maximum combination of goods that can be produced given available resources.

15. Each point on the production possibilities curve represents the maximum ______ that can be produced in a given time period with available resources. Multiple choice question. output income prices demand

output

14. Because wants exceed resources, the economic question of '______ to produce' is related to identifying the goods and services we want most, sacrificing less desired products. Multiple choice question. for whom what how where

WHAT

4. The three main decisions that must be addressed by an economic system do not include: * WHAT goods and services to produce * HOW output is produced * WHY output is produced * FOR WHOM output is produced

WHY output is produced

Land, labor, capital, and entrepreneurship are all scarce economic resources privately or collectively owned by members of society. When these scarce resources are used to produce goods or services, there is ______. Multiple select question. no opportunity cost no cost borne by society in utilizing these resources to produce goods or services a cost borne by society in utilizing these resources to produce any good or service no "free lunch"

a cost borne by society in utilizing these resources to produce any good or service no "free lunch"

8. In the United States, one of the key economic effects of the COVID-19 pandemic was: Multiple choice question. economic growth a mild economic downturn a serious economic downturn a higher employment rate

a serious economic downturn

26. Points______ the production possibilities curve are possible to produce so long as an economy uses all of its available resources and technology. Multiple choice question. beyond along below inside

along

18. Select all that apply Combinations of goods that are on the production possibilities curve: Multiple select question. are possible to produce are desirable combinations of output are not possible to produce represent economic growth utilize available resources and technology

are possible to produce utilize available resources and technology

2. Once you start an ABA assignment, you ____________ must complete it in one sitting can close it, then start the ABA again from the beginning can close it and come back to the same location in the ABA another time can close it and complete it later, but will receive a lower overall score for that attempt

can close it and come back to the same location in the ABA another time Explanation If at any time you need to leave the activity before you fully complete it, just click the "Close" button. You can pick up where you left off by going back to the activity, clicking "Continue," then "Play Attempt." You will be taken to your last location in the ABA and your overall score will not be affected.

After the ABA due date has passed, you ________. cannot review or study from any of your previous attempts need instructor approval to review your previous attempts can still review and study from any of your previous attempts can only review and study from your highest scoring attempt

can still review and study from any of your previous attempts Explanation You can review and study from any of your previous ABA attempts, even after the due date has passed. Instructor approval is not required.

20. Which of the following illustrates the alternative combinations of goods and services that could be produced in a given time period with all available resources and technology? Multiple choice question. The study of economics Factors of production Production possibilities Scarcity Opportunity cost

production possibilities

______ and income transfers are two primary mechanisms for the government to redistribute incomes in the U.S. Multiple choice question. Economic growth Income mobility Government failures Taxes

taxes

Once you select an answer to a question, you ________. cannot change your answer within the same attempt can change your answer at any time during that attempt and earn all of the available points can still change your answer, as long as you do so immediately can change your answer at any time during that attempt, but will not receive of all the available points

cannot change your answer within the same attempt Explanation Once you select an answer to a question, you cannot change it later in the same attempt. Of course, if your instructor allows multiple attempts, you can select a different answer when you attempt the activity again.

13. Factories, networks, transportation and distribution facilities, as well as tools and machinery, are all examples of _____ goods. Multiple choice question. entrepreneurship capital land labor

capital

21. For economists, _____ goods are those goods, such as machines, used to produce final consumer goods and services. Multiple choice question. entrepreneurship labor capital land

capital

29. An increase in output (real GDP) is called Multiple choice question. investment economic growth opportunity cost production possibilities

economic growth

An increase in output or an expansion of production possibilities is called: Multiple choice question. gross domestic product per capita GDP economic growth productivity

economic growth

37. An expansion of production possibilities is called Multiple choice question. opportunity cost. economic growth. investment. output.

economic growth.

16. The factor of production related to the skill in creating products, services, and processes is known as ____________ . (Use one word for the blank.)

entrepreneurship

24. The skill of creating products, services, and processes is the factor of production called Multiple choice question. entrepreneurship technological training land capital

entrepreneurship

34. The economic question of '______ to produce' is about decisions related to who is going to consume the goods and services produced. Multiple choice question. how what for whom when

for whom

43. Decisions related to who is going to consume the goods and services produced is the economic question of '______ to produce.' Multiple choice question. when how what for whom

for whom

Government intervention that fails to improve economic outcomes is called a: Multiple choice question. government failure mixed economy market economy market failure

government failure

32. The economic question of '______ to produce' is about decisions related to the mix of factor inputs (land, labor, and capital) used to produce goods and services. Multiple choice question. when how what for whom

how

41. The economic question of ' _____________ (one word) to produce' is about decisions related to the mix of factor inputs (land, labor, capital...) used to produce goods and services.

how

From an economic standpoint, ______ includes all natural resources used in the production process. Multiple choice question. labor land supply capital

land

44. A situation in which the market mechanism gives us a suboptimal economic outcome is known as Multiple choice question. market failure scarcity central planning government failure opportunity cost

market failure

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33. The 9/11 terrorist attacks on New York City and Washington, D.C. moved the mix of output in the U.S. toward more Blank______ spending. Multiple choice question. consumer investment military capital

military

6. Select all that apply Compared to 1900, because of technology the modern U.S. economy has * more free time * more television sets * shorter life expectancy * more new cars * higher levels of education

more free time more television sets more new cars higher levels of education

28. A production possibilities curve shows the alternative combination: Multiple choice question. of various final goods and services that could be produced in a given time period with an unlimited amount of resources of goods and services that could be produced in a given time period with all available resources and technology of two goods that could be produced in a given time period with an unlimited amount of resources of two goods that will be produced with the given resources

of goods and services that could be produced in a given time period with all available resources and technology

economics

offers a framework for explaining how we make such choices. The goal of economic theory is to figure out how we can use our scarce resources in the best possible way. The study of how best to allocate scarce resources among competing uses.

Ch. 1 1. The abundance of goods and services we have today is largely because our factories, offices, and homes have been transformed by ______________

technology