Economics Posttest Unit 2

shifts PPC to the left

Many of the country's young people died in an earthquake.

What is the definition of economic growth?

a rise in the total amount of goods and services produced within the borders of a nation

Which factor of production includes human-made resources used to produce a good or a service?

labor

Jack sells homemade chocolates and cookies. He expects the price of chocolates to increase around Valentine's Day, so he prepares to make more chocolates in February. Which economic concept lies behind Jack's decision to make more chocolates in February?

law of supply

A country made education free and mandatory up to age 15. It established 100 new schools to educate kids across the country. As a result, citizens acquired the ____ required to work. The schools generated ____ for teachers and other staff. In 20 years, the country saw a rapid ___ in its GDP.

skills, employment, rise

A highly technical job demands special ___, which helps the person get higher ___.

skills; wages

Newton Bay is a sparsely populated area. The government plans to build an international airport there and announces this plan publicly. When hotel chains learn about the airport, they become interested in building new hotels near the airport to accommodate travelers. What is the likely economic impact of this situation on commercial real estate in Newton Bay?

the demand for land will increase and the price of land will increase

How can the government of a nation invest in physical capital?

-by building highways, railways, and airports -by introducing mandatory physical training in schools -by supplying nutritious food to low-income families

What are the advantages a market economy offers producers?

-minimal government intervention -property rights

Anita is an entrepreneur who is interested in starting a hair salon. Anita consulted her friend Ali, who is a businessman, to get some business advice. Ali advised Anita to calculate the total _________she will need to raise. He advised her to choose a __________where she can find skilled labor and plenty of clients. He also advised her to figure out the ________ for every piece of equipment she buys for the salon.

1) capital 2) set of services 3) total cost of ownership

shifts PPC to the right

A new technology is invented to produce more food grains in the country.

George works in a factory and is a member of the labor union. He thinks his wages are low for the work that he does, so he tells the union representative that his employer should increase his wages. The representative asks the other workers if they feel the same, and they all agree. The following week, the union representative met with the factory owner regarding an increase in wages, and the employer agreed to it. What strategy did the union use to get the owner to agree to increase wages?

Collective Barganing

Which statement is false?

Growth in the economy shifts the PPC left.

point on the original PPC

The country is using all its resources efficiently.

unattainable point

The country plans to produce goods that are not possible to produce with the available resources.

Which statement is false?

The quality of a good determines wages.

What does a production possibilities curve represent?

a combination of two goods that can be produced using limited resources

These graphs illustrate the demand of olive oil. Match the non-price determinants of demand with the type of shift in the demand curve they are likely to cause. type 1 non price determinant causing the demand to decrease type 2 non price determinant causing the demand to increase

answers type 1 a decrease in the price of other vegetable oil and many olive oil producers entering the market type 2 a report in news stating that consumption of olive oil improves health and a decrease in supply of olives caused by poor harvest

Drag each event to the correct location on the chart. These graphs illustrate the supply of olive oil. Match the non-price determinants of supply with the type of shift in supply curve they are likely to cause. type 1 non price determinant causing the demand to decrease type 2 non price determinant causing the demand to increase

answers type 1 doctors recommend the use of safflower seed oil and more people embrace an oil free diet type 2 news reports about the benefits of olive oil for heart health and more people use olive oil for skin and hair care

How do property rights benefit entrepreneurs?

by enabling them to purchase capital and use it as they see fit