Eco252 SB Assignment
Taken together, the four general categories of economic resources (land, labor, capital, and entrepreneurial ability) are referred to as which of the following?
Factors of production
Which of the following statements or questions are examples of normative economics?
The government should increase the minimum wage. What should the minimum wage be? The government ought to bail out distressed banks.
Normative economics is ______.
based on value judgments
Economic principles are generalizations that are ______.
expressed as the tendencies of average consumers, workers or firms
Unemployment in the economy is graphically represented by ______ the production possibilities curve.
points inside
For better or worse, people have ______.
virtually unlimited wants
Which discipline studies the economy as a whole or its basic subdivisions or aggregates?
Macroeconomics
is the discipline that examines the performance and behavior of an economy as a whole.
Macroeconomics
Which of the following are issues most explored in microeconomics? (Check all that apply.)
Measuring total revenues of a firm Measuring the price of specific goods The expenditures of a government entity
Which statement best describes combinations of goods that are beyond the production possibilities curve?
They are unattainable.
A point that lies inside the production possibilities curve reflects which of the following?
A failure to achieve full employment
Which of the following are the focus of positive economics? (Check all that apply.)
Cause-and-effect relationships Facts
______ economics considers the desirability of certain aspects of the economy and underlies expressions of support for particular economic policies.
Normative
Positive economics ______ value judgments, tries to establish ______ statements about economic behavior, and deals with ______ economic events.
avoids; scientific; actual
Which of the following enables society to produce more goods with current resources?
Advances in technology
What does every point on a budget line graph represent?
All combinations of goods that can be purchased with a given income
When a country engages in international specialization, it focuses on producing which of the following?
Goods with the lowest opportunity costs
Why are aggregates used in macroeconomics?
To obtain an overview of the economy
The straight-line budget constraint indicates ______ opportunity cost.
constant
An increase in income will ______.
shift the budget line to the right.
People desire goods and services that provide maximum utility. In fact, our desires or wants are ______.
unlimited
Which best defines utility?
The satisfaction or pleasure obtained from consuming a good or service
Which of the following occur when limited economic resources are used to produce one type of good instead of another? (Check all that apply.)
There is a cost borne by society in utilizing these resources in lieu of the next best thing. There is an opportunity cost.
What are the functions of an entrepreneur?
To combine the resources of land, labor and capital to produce a good or service To make strategic business decisions
Normative, value-based policy questions or statements give rise to ______.
controversy or disagreement among economists
Which of the following are general categories economists use to classify economic resources?
entrepreneurial ability labor land capital
The assumption behind purposeful behavior is that ______.
people act in such a way as to rationally pursue their own interests
This ______ table lists the different combinations of pizza and robots that can be produced with a specific set of resources.
production possibilities
A ______ lists the different combinations of two products that can be produced with a specific set of resources, assuming full employment.
production possibilities table
When individuals and institutions make decisions with some desired outcome in mind, they are engaging in ______ behavior.
purposeful
Arable land, water, machinery, and professional athletes are all considered economic Unavailable (Enter one word) used in the production of goods and services.
resources
Land and mineral resources, transportation and communication facilities, factories and farm buildings, equipment, tools and machinery are all examples of _______.
scarce economic resources
In a world of scarcity, ______.
the decision to obtain the marginal benefit (MB) of a specific option always includes the marginal cost (MC) of forgoing something else
Your next-door neighbors want to go on a European vacation but cannot afford it, so they decide to visit a local amusement park instead. This is an example of ______.
the economizing problem
The concept at the core of economics that "there is no free lunch" reflects the notion that ______.
the scarce resources that are used to produce the so-called "free goods" have alternative uses that are given up
The economic assumption that human behavior reflects rational self-interest is predicated on individuals and institutions ______.
weighing the costs and benefits of their decisions
Positive economics is concerned with ______, whereas normative economics deals with _____.
what is; what should be
In which of the following ways do capital goods differ from consumer goods?
Capital goods satisfy consumer wants indirectly by facilitating the production of consumer goods. Consumer goods satisfy wants directly.
Specializing and participating in international trade allows an economy to do which of the following?
Circumvent the output limits imposed by its own production possibilities curve Increase the quantities of capital and consumer goods available to society
Which of the following can be stated as potentially true about any economy?
Its current choice of position on its production possibilities curve helps determine the curve's future location.
Which discipline studies the decision-making process of customers, workers, households, and business firms on an individual basis rather than as aggregates?
Microeconomics
Which of the following are examples of changing resource supplies?
Population growth Discovery of new resources Improvements in labor quality
A production possibilities curve with an increasing slope is the result of which of the following?
The law of increasing opportunity costs
Which concepts or terms refer to the notion that all variables except those under immediate consideration are held constant for a particular analysis? (Check all that apply.)
The other-things-equal assumption Ceteris paribus
Which statements best describe the combinations of goods that lie on the production possibilities curve?
They are attainable. They utilize all of an economy's available resources.
Points ______ the production possibilities curve represent a maximum output of two products as long as the economy is fully employed.
along
All natural resources, human resources, and manufactured goods that go into the production of goods and services are considered as society's scarce resources.
economic
Points lying ______ the production possibilities curve are attainable but reflect less total output than can be produced.
inside
The work-related activities of a teacher and doctor fall under the resource category of
labor
Economic principles are generalized statements that ______ consumer behavior.
look at typical
A production possibilities curve (PPC) illustrates the attainable combination ______,
of two goods that can be produced given a specific set of resources
Trade-offs arising from limited resources give rise to ______.
opportunity costs
When individuals weigh costs and benefits, their economic decisions are ______ and purposeful.
rational
The outward bowing shape of the production possibilities curve is due to ______.
the law of increasing opportunity costs
The optimal allocation of resources occurs when ______.
the marginal benefit of the good equals the marginal cost
Economic growth is the result of which of the following?
Improvements in resource quality Technological advances Increases in the supply of resources
Which of the following is true of positive economics?
It avoids value judgments. It tries to establish scientific statements about economic behavior. It focuses on facts and cause-and-effect relationships.
______ economies must forgo some of one good to gain more of another, whereas ______ economies are able to increase production of both goods.
Static; dynamic
Because consumers behave in a rationally self-interested manner, the consumer will purchase a good or service ______.
when the marginal benefit is greater than the marginal cost
Which of the following illustrates the attainable combination of two goods that can be produced given a specific set of resources?
Production possibilities curve
Which of the following are economic themes considered in macroeconomics?
The unemployment rate The level of prices in the economy National income
When a hypothesis formed using the scientific method continues to hold true when tested against facts over time, the hypothesis evolves into a
Theory
When people get satisfaction from charitable giving, they are ______.
acting out of rational self-interest
When economists consider the output of all U.S. businesses as a single entity, they are treating them as a(n) ______.
aggregate
A consumer's line or constraint shows various combinations of two products that can be purchased with a specific amount of income.
budget
For economists, ______ goods include all manufactured aids used in producing consumer goods and services.
capital
Consumers must make choices about what to buy and what to forgo to fulfill wants because ______.
consumers' incomes are limited
Even at higher levels of ______, people will still face spending trade-offs, choices, and opportunity costs.
income
Points lying ______ the production possibilities curve represent greater, but unachievable levels of output with current inputs, than that at any point on the curve.
outside
In developing economic theories, principles, or models, economists ______.
remove clutter and simplify
In addition to goods, also satisfy our wants.
services
In this figure, obtaining more books by giving up some movies is called a(n) ______; whereas losing two books in order to gain 1 movie is referred to as ______ cost.
trade-off; an opportunity
The pleasure, satisfaction, or happiness obtained from consuming a good or service is known as . (Enter one word in the blank.)
utility
True or false: Economists use the terms "capital" and "money" interchangeably.
False
True or false: Everyone except for the super wealthy has a finite, or limited, amount of income.
False
True or false: Positive economics encourages value judgments.
False
True or false: To economists, rational self-interest is the same as selfishness.
False
Which of the following is a result of having scarce economic resources for the production of goods and services?
Fewer options that require choices
True or false: A decrease in income will shift the budget line to the left.
True
Consumers must forgo certain goods and services based on a limited budget because ______.
a consumer spends his or her limited budget purchasing a combination of goods and services that maximize his or her satisfaction
A production possibilities table illustrates that at any point in time ______.
a fully employed economy must sacrifice some amount of one good to obtain more of another good
Factories, storage, transportation, and machinery are all examples of ______ goods.
capital
A statement about economic behavior or the economy that enables prediction of the probable effects of certain actions is known as a(n) ______.
economic principle
The problem refers to the need to make choices because economic wants exceed economic means. (Enter one word in the blank.)
economizing
What is the simplified term economists use to refer to "factors of production"?
inputs
What do economists call the physical actions and mental activities that people contribute to the production of goods and services?
labor
From an economic standpoint, ______ includes all natural resources used in the production process.
land
As a result of our ______ incomes and ______ wants, it is in our self-interest to economize or pick and choose goods and services that maximize our satisfaction.
limited; insatiable
In economics, what term is used to mean "extra," "additional," or "a change in"?
marginal
For conducting marginal analysis, individuals compare ______.
marginal benefits and marginal costs
Economists do not include money as an economic resource because ______.
money produces nothing
The disagreement among economists typically revolves around ______.
normative economics
Due to scarce resources, society is faced with a(n) ______ cost when choosing to acquire a good by sacrificing the next best thing that could have been acquired with those resources.
opportunity
The ratio of the price of two goods on a graphed budget line is measured by its .
slope
An economy can produce either guns or butter with all available resources. Suppose it currently produces all butter and it chooses to produce some guns, thereby giving up some production of butter. As a result, the first 200 units of guns are produced at the cost of only 50 units of butter. Not surprisingly, the next 200 units of guns are produced at the cost of 150 units of butter and the last 200 units of guns at the cost of 300 units of butter. What does this describe?
The law of increasing opportunity costs.
A rightward shift of the production possibilities curve of an economy represents which of the following?
A rightward shift of the production possibilities curve of an economy represents which of the following?
______ goods satisfy wants directly, whereas ______ goods do so indirectly.
Consumer; capital
What do combinations of output that fall inside the production possibilities curve represent?
Less total output than points on the curve Goods that are attainable
As more and more of a particular good is produced, which of the following rises?
Opportunity costs
What is the cause of a society's increasing opportunity costs with respect to the production of goods?
Resources that are not fully interchangeable
Which of the following are illustrated by the following figure? (Check all that apply.)
That as one moves to the right and produces more pizzas, the number of robots that must be given up rises. That the resources used to produce industrial robots and pizzas are not perfectly flexible and interchangeable.
Suppose an economy produces consumer goods and capital goods. Its current combination of production involves a higher level of capital goods than consumer goods. Which of the following can be inferred from this current choice on its production possibilities curve
That its present choice in production may result in higher future prospects for economic growth
Improvements in the methods of production allows for the creation of ______.
more goods with available resources.
The maximum output of an economy with a specific level of resources is reflected by the points ______ the production possibilities curve.
on
When an economy produces a good such that the marginal benefit equals the marginal cost, this indicates that ______.
resources are being allocated efficiently
Suppose you are given a $100 gift card and you choose to spend it on a number of goods. You will select a combination of goods that is best for you and that maximizes your satisfaction. Your choices will involve which of the following?
A comparison of marginal benefits and marginal costs for each good considered
Which of the following illustrates that at any point in time, a fully employed economy must sacrifice some amount of one good to obtain more of another good?
A production possibilities table
The scientific method, on which economics relies, consists of several elements, including which of the following?
Accepting, rejecting, and adjusting a hypothesis Observing real-world behavior and outcomes and formulating a hypothesis based on said observations Continuing to test the hypothesis against facts
Which one of the following best characterizes the "other-things-equal" assumption?
All variables except those under immediate consideration are held constant for a particular analysis.
Which of the following scenarios are illustrated in the given production possibilities curve?
An economy in full employment along the curve Attainable combinations of both goods below the curve
Which of the following resources would be considered to be land by an economist?
Arable land Forests Oil and mineral deposits Water
Which of the following are ways of expressing the meaning of ceteris paribus? (Check all that apply.)
Assuming other things remain constant Assuming factors other than those being considered in a particular analysis do not change
Why is it in our self-interest to economize or pick and choose goods and services that maximize our satisfaction?
Because of our limited incomes conflicting with our insatiable wants for goods and services
Which of the following combinations are unattainable given a consumer's budget line?
Combinations that fall beyond the budget line
Which of the following describes a budget line?
A curve showing various combinations of two products a consumer can purchase with a specific amount of income.
If economists examine the relationship between the price of a good and sales of that good while ignoring other related factors, or assuming those other factors are equal, they are using which of the following?
Ceteris paribus
Which of the following combinations are attainable given a consumer's budget line?
Combinations that fall on the budget line Combinations that fall inside the budget line
______ comes in the form of wages, interest, rent, profit, and even from government programs.
Income
As individuals' incomes rise, they will still be confronted with which of the following?
Opportunity cost Trade-offs Choices
______ economic resources means limited goods and services.
Scarce
In macroeconomics, an aggregate is a collection of which of the following?
Specific economic units treated as if they were one unit
An entrepreneur does which of the following?
Takes the risk of commercializing new products Makes strategic business decisions that set the course of an enterprise Innovates
Marginal analysis involves the evaluation of which of the following?
The additional cost versus the additional benefit of a decision
Which of the following lead to increases in wants over time?
The introduction of new and improved goods A lesser good triggering the desire for a better one
True or false: A trade-off occurs when some quantity of production of a good is given up in order to produce another good.
True
Choosing one good or service over another based on a comparison of marginal benefits and marginal costs always involves ______.
an opportunity cost
The highest-valued alternative that is given up or sacrificed when choosing to produce or consume one good over another is referred to as ______.
an opportunity cost